NEW DELHI, India-High handset prices in Thailand have become a bone of contention between operators and government authorities. Operators are offering huge airtime promotions, while keeping handset prices high, attracting the wrath of consumer groups.
Although the government has resolved the issue by ending the monopoly of network operators in handset imports, industry remains skeptical about the success of the move.
Initially, the government pressed cellular operators to revise pricing after consumer groups complained that handset prices were two to three times higher than prices overseas. The Telephone Organization of Thailand (TOT), a landline carrier that also operates a mobile-phone service, complained that private operators’ promotions affected its revenue, particularly on long-distance calls. Operators argued that prices of handsets in Thailand-with airtime promotions-are attractive compared with other countries in the region.
Not convinced, Transport and Communication Minister Suthep Thaugsuban proposed in May that airtime promotions be replaced with free handsets or price discounts, a move that was vehemently opposed by operators.
Later a compromise was reached; state and private mobile-phone operators agreed to draw up new guidelines on promotional campaigns, based on the common interests of the state, operators and consumers.
When even this failed to yield results, TOT’s board decided to end the monopoly of handset imports by private mobile-phone operators. TOT has regulatory powers until October, when the National Telecom Commission will take over as regulator.
Sombat Uthaisang, TOT board chairman, said TOT would not allow private operators to issue telephone numbers for their mobile phones. Individual subscribers importing their own handsets or import companies must apply for numbers at the TOT instead. Until recently, importers had to seek telephone numbers from operators for handsets before subscribers could get connected to networks. Therefore, most import companies worked in conjunction with a specific carrier.
Sombat said now any importer can import handsets and come directly to TOT for telephone numbers. In practice, handset suppliers would be allocated numbers by TOT instead of network operators.
“[The success of the new plan] depends on how customers look at it,” said Sanchai Thiewprasertkul, Advanced Info Service (AIS) senior executive vice president. “There are hundreds of issues that need to be settled. Customers will have to go get a permission letter from TOT, register with the Post and Telegraph Department, get customs clearance and so on for their handsets before they could come to the service provider. Right now, TOT cannot issue any numbers, because they do not have any numbers.”
Both the leading providers, AIS and Total Access Communication (TAC), have their own importing arms for procuring handsets and have refused to divulge pricing details. Manufacturers too are reluctant to give pricing details.
“The pricing of handsets is decided by our distributors, and we don’t set their pricing policy,” said Suphakit Vuntanadit, regional marketing manager for Motorola’s Consumer Solutions Group South Asia. “It would be rather difficult to compare prices of handsets in Thailand with other countries as operators’ marketing strategies and plans vary from country to country, and each operator offers various value-added services.”
Industry sources doubt if the TOT plan will succeed, because consumers who buy handsets directly from suppliers will not be eligible for the network operators’ discounts. TAC Vice President Jaturon Himathongkam, in particular, wonders if the process of issuing numbers to suppliers will work in practice. Though AIS has allowed suppliers to import their own handsets for distribution, company officials said customers have to pay network access charges of 4,070 baht (US$104) per handset.
