AIS plans B60bn digital drive
Advanced Info Service Plc (AIS) has set aside at least 60 billion baht for the first stage of fourth-generation (4G) wireless and fixed-line broadband project developments next year in a quest to capitalise on emerging digital lifestyle trends.
The move by the country's largest mobile operator is a challenge to True's dominance of the 4G and fixed-line broadband markets.
The 4G mobile broadband and fixed broadband services are among nine breakthrough businesses for AIS parent InTouch Plc, formerly known as Shin Corporation.
The others are mobiles, satellite, venture capital funds, cloud computing, digital content, digital TV and its newly created convergence infrastructure unit.
InTouch has been trying to move beyond being a pure-play telecom by expanding its digital life segment, which includes digital content and digital TV.
"We're aiming at what we term non-AIS revenue to generate up to 25% of the group's revenue over the next five to seven years, up from 6% now," said Somprasong Boonyachai, executive chairman of InTouch.
"AIS will remain the primary source of revenue for our group, as a mobile is no longer a luxury item."
AIS chief executive Somchai Lertsutiwong said 15-20 billion baht of next year's 60-billion-baht budget was slated for 4G licence auctions.
At least 40 billion baht will be used for the installation of 4G network and fixed-line broadband infrastructure.
AIS has already spent 4.8 billion baht on the first phase by installing 100,000 kilometres of fibre-optic lines with capacity to serve 300,000 users.
The company launched its fixed broadband service in test mode last month, while a subscription service is due to launch by next March.
Thailand has 5 million fixed-line broadband users compared with more than 90 million mobile subscribers.
AIS's mobile subscriber base had reached 43.8 million as of Sept 30, up by 2.1%, including 38.7 million 3G customers.
Mr Somprasong believes auctions for the 900- and 1800-megahertz frequencies for 4G service will take place next year after being delayed for one year by the new government.
The company is also in talks with TOT Plc about a partnership to provide a 4G service that may cover roaming or involve a mobile virtual network operator deal.
Mr Somprasong said InTouch was preparing to jump into the digital content market and studying the possibility of operating digital TV under a behind-the-scenes business model.
InTouch has already accomplished five of its breakthrough businesses — mobiles, satellites, venture capital funds, fixed-line broadband and cloud computing — and the others are still in the pipeline, he said.
Mr Somprasong said the group's satellite unit Thaicom Plc saw a turnaround this year with a nine-month net profit of 1.41 billion baht.
"The value of Thaicom has surged more than 60 times, with market capitalisation increasing to about US$1 billion," he said.
Mr Somchai said AIS projected revenue growth of 1.5% to 2% this year, reduced from 6% due to the country's political impasse and sluggish economy.
AIS posted a 7.4% year-on-year rise in third-quarter net profit to 8.95 billion baht. Its revenue was 35.5 billion baht, up by 0.5%.
AIS shares (ADVANC) closed yesterday on the Stock Exchange of Thailand at 239 baht, up four baht, in trade worth 758 million baht.