TOT Plc will spend three billion baht (US$83 million) to upgrade its 2G network with 500 base stations in Bangkok into 3G and roll out the new services this year.
TOT's 2G network, operated by its 100 percent--owned ACT Mobile, is leased to Thai Mobile to provide the mobile-phone service on the 1900 MHz bandwidth.
TOT board chairman Teerawut Boonyasophon said TOT was confident it could launch the the 3G services in Bangkok this year. It has set up a team to draft the 3-billion-baht(US$83 million)upgrade plan, to be submitted to the board for approval soon.
But he said that with the upgrade, the agreement between ACT Mobile and Ericsson/Siemens/Mitsui Consortium would have to be revised, a process that could take five months.
The upgrade of the1900 MHz bandwith under the Thai Mobile brand would complement TOT's 29-billion-baht(US$811 million)3G nationwide network project.
For the nationwide network, he said TOT would act as the network provider and lease it to interested investors who would then provide the services to consumers.
In the latest development, the National Telecommunications Commission agreed to a proposal for CAT Telecom to transfer its right in the 1900 MHz bandwidth to TOT.
Mr Teerawut said that TOT board had agreed to kick off the two 3G projects simultaneously. In the future if the 3G services in Bangkok are not profitable, they could be merged into one project.
TOT spokesman Ratian Srimongkol said that the investment in the 3G nationwide network project would become clearer over the next few months or in April.
He said TOT was currently drafting the 3G business plan to accommodate the investment if everything became clearer.
Information and Communications Technology Minister Ranongrak Suwanchawee said the frequency transfer from CAT to TOT was moving ahead, which boded well for consumers at a time when 3G licenses had yet to be granted.
An industry source said that the start-up cost of the 3G nationwide network could be at least 40 billion baht (US$1.11 billion), making it difficult for TOT to assess the break-even point.
The source said that the 29 billion baht (US$811 million) budgeted by TOT was just for the 5,200 base stations to be constructed. It does not include the 42 percent stake worth 2.4 billion baht (US$81 million) which TOT has to buy from CAT, plus three billion baht (US$83 million) in accumulated debt owed to Samart I Mobile.
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