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Thailand Telecommunications Report Q3 2011
Business Monitor International, June 2011, Pages: 109
Business Monitor International's Thailand Telecommunications Report provides industry professionals and strategists, corporate analysts, telecommunication associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Thailand's telecommunications industry.
BMI has incorporated latest data released by Thailand’s telecoms operators and the National Telecommunications Commission, and made minor changes to the forecast scenarios to the country’s mobile, fixed-line and internet sectors. The number of mobile subscribers in Thailand reached 71.621mn in December 2010, representing a penetration rate in excess of 100%, and this report continues to expect muted growth in the industry in light of market saturation. Meanwhile, this report forecasts the number of fixed-line subscriber in the country to fall to 6.579mn in 2011 as the fixed-to-mobile service migration accelerates. Last, the number of broadband subscribers in Thailand at the end of 2010 exceeded expectations, which BMI believes was largely due to aggressive marketing campaigns by True Corporation (through TrueOnline) and Triple T Broadband.
Perhaps the most pertinent issue in Thailand’s telecoms industry is the ongoing 3G saga, which has not shown significant signs of positive developments. Although True plans to launch commercial 3G services by the end of 2011 after establishing an agreement with state-owned CAT Telecom, the agreement has attracted a legal suit from rival mobile operator Total Access Communication (DTAC). BMI is not surprised by this development given that the Thai telecoms industry has always been shrouded with legal tussles and regulatory uncertainties due to a complicated and inflexible legal framework. While it remains to be seen if the issue could be resolved amicably and quickly, BMI reaffirms the need for nationwide 3G services, which could provide a significant boost to operators’ profitability.
Although Advanced Info Service (AIS), DTAC and TrueMove saw their ARPU in the quarter ended December 2010 rebound after declining in the first nine months of 2010, this report believes that the improvement was temporary in nature due to seasonality factors. The report notes that operators generally experienced stronger ARPU levels in the final quarter of the year in the past few years. Suspicions were confirmed after DTAC released its Q111 results, which saw its blended ARPU continued to trend downwards. BMI believes that delays in the launch of 3G services would apply further downward pressure on ARPU levels, and this is seen in the report’s ARPU forecasts.
Thailand continued to rank in the bottom half of BMI’s latest Business Environment Ratings for the Asia- Pacific region. It is unlikely for Thailand to move up the rankings in the short term due to inherent weakness such as the factors mentioned above. That said, Thailand’s private consumption growth is expected to reach 5.0% in 2011, and this report believes that consumer spending will remain robust, which bodes well for the country’s telecoms industry. Data from the Bank of Thailand (BoT) indicated that nominal wages rose by 13.7% y-o-y in November (10.9% in real terms) 2010. Moreover, the report notes that average wages have already pushed passed pre-crisis highs.
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