Thai consumer group to file petition against True, DTAC merger


By Reuters and published by CNA

A THAI consumer group today (Oct. 21) said it plans to ask a court to suspend the 326 billion baht ($8.6 billion) merger of the country’s second- and third-largest mobile operators over competition concerns.

The move by Thailand Consumers Council comes a day after the regulator cleared the way, with conditions, for the merger of True Corporation Pcl and Total Access Communication Pcl (DTAC), which would create the country’s top mobile operator.

The consumer group said it will also file a complaint with an anti-graft agency against the National Broadcasting and Telecommunication Commission (NBTC) for negligence of duty in protecting the public interest.

“The public interest will be damaged, consumers will have to pay more and there would limited access for those in under-served areas,” Saree Aongsomwang from the Consumers Council told Reuters.

“The NBTC has very little reason to allow the merger.”

The NBTC did not respond to requests for comment.

Experts have also raised concerns over collusion were the merger to go ahead.

“Who can consumers turn to because after this there will only be two operators, a duopoly,” Supinya Klangnarong, a former NBTC commissioner said, adding that it could increase the possibility of collusion.

“We’re going backwards because the number of users have grown and so there should be more operators,” she added.

The regulator, which said it did not have the authority to reject or approve the deal, said after a 3-2 vote the companies must meet conditions on a price control mechanism, data transparency and separation of services to proceed.

The combined entity would overtake market leader Advanced Info Service Pcl (AIS), which currently counts 44 per cent of mobile subscribers. True controls 34 per cent of the market and DTAC 21 per cent.

Kasikorn Securities analyst Pisut Ngamvijitvong said in a note to clients that he did not expect the court to suspend the deal.

Reports commissioned by the NBTC that have not been made public, but seen by Reuters, recommend that merger be “prohibited” because it was not Thailand’s interest.

Findings by SCF Associates say the merger could lead to a decline of GDP growth of 0.6 per cent to 1.5 per cent in five years due to lower investments, a slower rollout of 5G technology and widening the digital divide.

The reports added that findings may change with additional research.

AIS, True and DTAC did not respond to a request for comment.

In a statement this week, DTAC said “the new company will protect customer data, respect privacy, and have the highest priority on cybersecurity.”


The logo of True Corporation is pictured in front of its office building in Bangkok on March 1, 2016.  Photo: Reuters/Athit Perawongmetha and published by CNA

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