Telecommunications in Thailand

Stockxpert

The Kingdom of Thailand has a population of some 64 million. The country’s first telephone line was installed in 1881, between the capital Bangkok and Samutprakarn. Today, the latest ITU figures show a teledensity of 11 fixed telephone lines per 100 inhabitants. In contrast, the number of mobile phone subscriptions represents more than 80 per cent of the population, or some 50 million people (see box).

Categorized as a newly industrialized nation, Thailand is a significant manufacturer of equipment for information and communication technologies (ICT). Its Ministry of Information and Communication Technology (MICT) was established in 2002 with the mission to “develop and support more comprehensive electronic processes for government, commerce, industry, business and education”. This policy aims to incorporate ICT into every aspect of Thai society and, ultimately, transform the economy and the nation.

The background

The Telecommunications Business Act of 2001 laid the basis for deregulating the Thai telecommunication sector. An independent regulator, the National Telecommunications Commission (NTC), began work in 2004 and the market is partially liberalized. The private sector participates through build-transfer-operate (BTO) concessions from State-owned enterprises. Under this arrangement, concession holders build network infrastructure that is transferred to the State agencies. The operators have an exclusive right to use the assets during the term of the concession. Revenues are shared with the State agencies. The Act provides for the concession-based system to be changed eventually to one based on licences granted by NTC.

The first of Thailand’s State-owned enterprises in this sector is TOT Public Company Limited, which provides the infrastructure for domestic fixed phone lines and was originally founded as the Telephone Organization of Thailand (TOT) in 1954. It has granted concessions to True Corporation Public Company Ltd (established in 1990 as Telecom Asia), which offers fixed lines in the Bangkok metropolitan area, and to the Thai Telephone and Telecommunication Company ((TT&T) that provides lines elsewhere.

Another State-owned business is CAT Telecom Public Company Limited, formerly known as the Communications Authority of Thailand (CAT). It owns Thailand’s international telecommunication infrastructure, including connections to two satellite Earth stations and to the five submarine cables that link Thailand with Europe, the Middle East, Malaysia, Singapore, Indonesia, Hong Kong (China), the Philippines, Taiwan (China), the Republic of Korea, and Japan.

Competitive mobile telephony

Reflecting its booming growth, the mobile telephony market boasts an increasing number of private-sector enterprises. With almost all communities in Thailand covered by a mobile phone signal, competition among service providers has been intense.

Advanced Info Service Public Company Limited (or AIS) is the country’s largest mobile firm and operates under a concession from TOT. The company with the second-largest number of mobile subscribers is Total Access Communication PLC (or DTAC), which has a concession from CAT. Other mobile phone operators include True Move, part of True Corporation Public Company Limited, and Hutch, a joint venture between CAT and Hutchison Telecommunications International Ltd.

Mobile broadband

A study from market research firm Nielsen says that Thailand has the highest rate of mobile subscribers using the Internet among the Asia-Pacific economies that it surveyed. Some 10 per cent of mobile subscribers use their phones to access the Internet, equivalent to almost 40 per cent (or more than 5 million) of all Internet users in the country, according to the firm’s report “Critical Mass: The Worldwide State of the Mobile Web”, released in July 2008. Third-generation (3G) mobile networks improve the consumer experience by providing services at broadband speeds, and they are beginning to be developed in Thailand.

In May 2008 in the city of Chiang Mai, AIS launched a commercial trial of 3G mobile phone services using HSPA (high speed packet access) technology. The company plans to expand the service nationwide. DTAC also aims to provide a nationwide 3G service by the end of 2009.

WiMAX technology for mobile phones has also been tested by AIS, while TT&T Broadband has reportedly announced that from September 2008, it will offer WiMAX connections among 21 universities in Chiang Rai Province. The pilot project could lead to the company providing a WiMAX broadband network throughout Thailand.

The Bangkok Metropolitan Administration (BMA) is working with True Move to create a Wi-Fi network covering more than 400 square kms in the city. The BMA will issue half a million free Wi-Fi cards to the public as an incentive to use the Internet as a substitute for travel, in order to create a greener capital city. True also recently launched a package combining flat-rate Internet access from its mobile network with Wi-Fi access in around 15 000 hot spots across the country.

In early August 2008, MICT put forward for government approval a plan by TOT to create a nationwide 3G network offering broadband services. The plan covers the years 2009 to 2011, for a network that TOT would lease to telecommunication providers. TOT is said to be aiming for at least four million 3G subscribers within five years.

Given the widespread use of mobile phones, it seems likely that they could become the means of broadband connectivity for most people in the years to come. Meanwhile, broadband access uses asymmetric digital subscriber line (ADSL) technology, while the majority of people continue to access the Internet through dial-up connections.

Internet access for all

Qualcomm Telemedicine makes use of ICT connections to remote villages in the Thai countryside

The number of Internet users in Thailand rose from just 30 in 1991 to more than 13 million in 2007 (Table 1). Government policy has encouraged this development, through agencies such as the National Electronics and Computer Technology Centre (NECTEC). And State-owned TOT, for example, offers a special number (1222) through which its phone subscribers can connect to most Internet service providers by paying only for the local telephone call. True Corporation offers a similar service to subscribers of its fixed telephone lines. In addition, TOT dramatically cut charges for broadband Internet access in 2002, sparking a corresponding fall in prices across the sector and a rise in demand.

Both TOT and CAT launched nationwide projects to establish public Internet booths at post offices and similar facilities. Another example of the country’s push to expand connectivity can be seen in the programme for educational institutions. The SchoolNet project, begun by NECTEC in 1995, did much to stimulate provision of Internet access in schools. According to the Ministry of Education, all schools in Thailand are now connected to the Internet.

Connecting villages

ICT expansion is foreseen in other areas too. For example, the Agriculture Information Network serves the core industry in Thailand’s countryside that is home to more than 60 per cent of the population. Under the Rural Telephone Project, TOT plans to provide public telephones in remote villages that are outside the public switched telephone network (PSTN) service areas (see also an article in ITU News of January-February 2008). A group of villages in Thailand is known as a “tambon”, and there are some 7000 across the country. The Tambon Net initiative aims to provide Internet access to all tambon administrative offices, for their official work and to make services available to local residents.

Looking ahead

ICT has long been one of the items at the top of Thailand’s policy agenda. Although progress was hampered by the Asian financial crisis of the late 1990s, the country is continuing the process of liberalizing and deregulating its telecommunication market.

The government backs a number of ICT initiatives, and an “IT 2010” policy was developed by the National IT Committee (NITC) in collaboration with the King Mongkut University of Technology Thonburi. MICT is undertaking steps to implement the plan, as well as looking to future decades. Through building human capital, promoting innovation and investing in ICT, the goal is to transform Thailand into a knowledge-based economy (Figure 1), and all citizens, in cities or rural areas, will be the beneficiaries.