IJIMT 2013 Vol.4(6): 579-583 ISSN: 2010-0248
DOI: 10.7763/IJIMT.2013.V4.465

An Analysis of Telecommunication Spectrum Clearing Prices in Thailand and Abroad

Settapong Malisuwan, Jesada Sivaraks, and Dominic P. Arena
Abstract— Thailand earned 41.625 Billion Baht (USD 1.39 billion) from assigning 45 MHz of 2.1 GHz spectrum on 16th October, 2012. While there has been much debate on whether the appropriate price has been achieved, it should be emphasized that valuation is subjective. In addressing the point of the value of 2.1 GHz spectrum, this research highlights four typical quantitative factors that are built into valuation models including Direct Cash Flows, Cost Savings, Defensive Value and Option Value, and compares this to Regulatory objectives and valuations. The analysis further takes into consideration benchmark spectrum prices achieved in recent telecom spectrum auctions with added analysis of recent auction failures. In keeping in mind the current supply of spectrum in Thailand and the time period in which the recent 2.1GHz auction took place, the Thai 2.1 GHz 3G auction is shown to have cleared at fair prices enabling licensees to move the industry forward and break free from a deadlock caused by the concessionaire regime. It is argued that if the spectrum was to be cleared at higher prices, it could have resulted in short term revenue maximization however this would hinder the long term growth and development of the telecom sector in Thailand and will potentially lead to higher prices for consumers.

Index Terms— Spectrum valuation, spectrum auction, direct cash slows, cost savings, defensive value, and option value.

Settapong Malisuwan and Jesada Sivaraks are with National Broadcasting and Telecommunications Commission, Thailand (e-mail: navneet.nbtc@gmail.com, jesada.s@nbtc.go.th)

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Cite: Settapong Malisuwan, Jesada Sivaraks, and Dominic P. Arena, " An Analysis of Telecommunication Spectrum Clearing Prices in Thailand and Abroad," International Journal of Innovation, Management and Technology vol. 4, no. 6, pp. 579-583, 2013.

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