THE TOT board has approved the state agency’s plan to sign a contract with Advanced Wireless Network (AWN) to launch a joint trial commercial service on TOT’s 2.1-gigahertz spectrum, but on the condition that three issues are clarified first, said TOT president Montchai Noosong.
While Montchai declined to specify what the three issues are, he said that if AWN and TOT could clear them up, they could go ahead with the contract without the need to ask for the board's consideration again.
AWN is a wholly owned subsidiary of Advanced Info Service (AIS). The planned joint trial service will last six months, after which they will sign other contracts as part of their partnership to provide third-generation cellular service on TOT's 2.1GHz band. During the trial period, TOT is expected to gain Bt300 million per month from wholesaling its spectrum to AWN to jointly provide the service.
A TOT source said the first issue was that AWN would have to report to TOT about the progress of the joint service.
Moreover, TOT has to urge AWN to agree to lease the 2G-900MHz network equipment under the TOT concession. The state agency expects to earn Bt2 billion a year in network rental fees for five years from this planned deal.
TOT will also have to urge AWN to agree to lease the 13,000 telecom towers that are currently subject to a dispute between TOT and AIS over their ownership.
The state agency expects to earn annual rental fees of Bt3.6 billion from that deal with AWN. In parallel, TOT and AIS have to settle their dispute quickly.
Recently the Office of the Attorney-General advised TOT to refrain from signing this contract with AWN pending the complete clarification of its legal aspects. TOT had asked the A-G's office to examine the revised draft of the contract and sent its representatives to explain details of the proposal.
The office replied to TOT that it should not enter the contract unless it obtains clear answers from relevant state agencies TOT has consulted on whether the planned partnership complies with the Public Private Joint Venture Act of 2013 and the Frequency Allocation Act of 2010. If it is found that the deal does not comply with those laws, this would invalidate the memorandum of understanding on the partnership signed between AIS and TOT on March 29.
As TOT plans to enter this contract with AWN, not with AIS, TOT should find out first if AIS owns more than half of AWN or controls AWN management. TOT should also examine whether AWN is in a position to take on the financial responsibility required by the terms of the contract.
The Office of the Attorney-General said that during the joint test of the service, during which AIS will allow its subscribers to use TOT's network and vice versa, TOT should get a clear answer from AIS first on whether TOT will have to pay for its use of AIS's network during the test. If so, will TOT itself or its subscribers pay those costs?
The office also advised TOT not to sign the contract unless it completely settles the dispute with AIS over the ownership of the telecom towers under the concession, as the joint service trial would require the use of equipment on the disputed towers.