UPDATE 1-Thai AIS to invest $326 mln on network expansion

Reuters | January 24, 2011 | Khettiya Jittapong
* Most of budget is to expand 2G network capacity
* To expand 3G services on existing networks by Q3
* 2011 revenue seen in line with industry’s 3-5 pct growth
* Shares down almost 5 pct on worries about concession probe (Adds details)
BANGKOK – Thailand‘s top mobile phone operator, Advanced Info Service Pcl ADVA.BK (AIS), said it planned to invest 10 billion baht ($326 million) on network expansion this year to benefit from continued growth in the sector.
Cash-rich AIS would spend 7.5 billion on expanding its 2G capacity and the remaining 2.5 billion baht on expanding 3G services on its existing 900 MHz frequency, Chief Operating Officer Mark Chong Chin Kok told a news conference on Monday.
AIS, 21.4 percent owned by Singapore Telecommunications Ltd (STEL.SI), has operated a 3G service on its 900 MHz spectrum using HSPA (high-speed packet access) technology since 2008 but it has limited coverage .
The company planned to install 1,884 base stations for this 3G service in Bangkok and other cities, and would gradually expand the service in the third quarter, he said, adding AIS also planned to launch WiFi wireless broadband services by the second quarter.
The Thai mobile industry is expected to grow 3-5 percent this year due to strong growth in demand for mobile data, social networks, smart devices and applications, plus continued growth in voice services, Chief Executive Wichain Mektrakarn said.
“Demand for basic voice service is still growing, while growth in mobile data usage jumped 100 percent last year,” Wichain said.
LOOKING FOR ALTERNATIVES
The company is looking for ways to expand business and upgrade existing networks after a court suspended an auction for new third-generation mobile licences in September.
According to OVUM market research, the value of the Thai mobile market is expected to reach 220 billion baht in 2011, up from 215 billion baht in 2010. Thailand has about 69 million mobile phone subscribers, more than its total population.
The market leader expected its service revenue this year to grow in line with the industry, and data service would continue to be a growth driver, Pornrat Janejarassakul, head of corporate planning and investor relations, told reporters.
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