TDRI chief slams 3G bid as ‘fake’ and ‘calculated’

Year2012-10-22

The president of the Thailand Development Research Institute (TDRI) has slammed the government’s “fake” auction for 3G mobile phone service licences, saying bidders got everything they wanted at an artificially low price.

Somkiat Tangkitvanich, TDRI president, alleged Sunday on the think-tank’s website that the auction – organised by the National Broadcasting and Telecommunications Commission (NBTC) – was fraught with irregularities.

Advanced Info Service (AIS) bid 14.6 billion baht, while Total Access Communications (Dtac) and True Corp bid 13.5 billion baht to win their licences.

The state made only 41.6 billion baht, Mr Somkiat said, only 2.8% more than the NBTC’s combined minimum reserve price.

Compared to similar auctions held for 3G bandwidth around the world, he added, the revenue generated from the 3G auction in Thailand is one of the lowest.

Mr Somkiat said bidders in the NBTC’s auction were confident they would obtain the licences without having to offer competitive bids to the state.

He said AIS may have offered a slightly higher bid possibly because it wants the privilege of choosing bandwidths that can be merged with TOT in the future.

Nine slots of bandwidth were available in last week’s auction and there are only three major mobile phone service providers in the country.

The NBTC set the minimum reserve price of each slot at 4.5 billion baht for a 15-year licence.

The three major operators won three slots each.

Mr Somkiat said that AIS’s decision to offer 1 billion baht more than DTAC and True for preferred bandwidths was suspicious.

He said a 225 million baht margin would have been sufficient for AIS to win its preferred slot of bandwidths.

The unnecessarily high bid, the TDRI president argued, occurred right at the beginning of the auction, in the first round.

This is strange because contenders can gradually raise their bids in later rounds if necessary, he said.

Mr Somkiat said he thought the unnecessarily high early bid was a calculated strategy to show there was an element of competition among bidders.

Green Politics group leader Suriyasai Katasila will today ask the National Anti-Corruption Commission (NACC) and the Office of the Ombudsman to investigate the 3G auction.

He said an NACC sub-committee had advised the NBTC to offer fewer 3G licences than the number of bidders to guarantee real competition, but his advice was ignored.

Vichai Vivitsevi, an NACC member, said the anti-corruption watchdog is only authorised to rule if the NBTC violated its duties.

The power to nullify the auction rests with the Administrative Court, he said.

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Published in the Bangkok Post, 22 ¬†October 2012,¬†TDRI chief slams 3G bid as ‘fake’ and ‘calculated’