Thailand Q3 2006 Market Update - Mobile World Briefing

The market share of Thailand's largest operator, AIS, fell below 50% by the end of Q3 2006 for the first time since December 1999. During the first quarter of 2000, the operator gained an overall majority from rivals Digital Phone, DTAC, TOT and CAT, and subsequently kept this advantage for more than six and a half years. However, the continued resurgence of DTAC, as well as impressive growth from its more recent competitor TrueMove (formerly TA Orange), saw the market leader lose more than 2pp of share in Q3 2006, to end the quarter with 48.5% of the market. DTAC and TrueMove together accounted for 49.8% of the national customer base at the end of September, or 18.22m customers to AIS' 17.72m.

Although there are seven active operators, Thailand is in essence a three player market. The analogue networks of the two state owned telephone companies TOT and CAT are all but dead and gone, with just a couple of thousand customers between them. Meanwhile Hutchison's CDMA joint venture with CAT continues to flounder with a lowly 2.0% market share and a dwindling customer base, and it surely cannot be long before Hutchison cuts its losses and exits the venture.

Lastly, there is Thai Mobile, a joint venture between TOT and CAT, which is surely a recipe for the most unproductive kind of bureaucracy if ever there was one. And so it has been: Thai Mobile has the privilege of being the country's only current 3G licence holder, but the arguments over the operator's future direction between its two government backers continue to this day. Currently, Thai Mobile languishes with a small 2G customer base just south of the 100k mark.

Thailand ended Q3 2006 with 35.6m customers, which is a 24.5% increase compared to the Q3 2005 total of 29.4m. Net additions in the third quarter, at 2.4m, were in excess of those in the three preceding quarters of the year: this is largely thanks to the remarkable 25% quarterly increase posted by TrueMove, which alone accounts for 1.4m of the period's new customers.

The third quarter growth took national penetration to 56.5%, from 52.9% at the end of Q2 2006. The 3.6pp uplift is the biggest single quarterly increase in penetration for four years in Thailand, and a dramatic improvement compared to the position the market was in a year ago.

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