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5G gaining momentum in Thailand

The fifth generation of wireless broadband is finally coming to Thailand as the nation’s telecoms invest heavily in 5G.

On 16 February 2020, the three major mobile operators and two state telecom enterprises bid a combined 100 billion baht at the auction for the spectrum required to set up 5G infrastructure, one report notes.

The high bidding prices came as a surprise, as telecom companies had earlier loudly contended that the auctions came too soon after last year’s spectrum bid, that the nation was not ready for 5G adoption and that the government still lacked a clear roadmap for frequency allocation.

Boosting the GDP

With as much as 100 times the speed of current wireless networks and with significantly reduced latency, 5G use cases are endless, not just for improving the efficiency of mobile phones, but for growing networks of Internet of Things (IoT) devices in areas like manufacturing, transport, healthcare, education, agriculture and more.

The upgrade to 5G has the potential to enable Industry 4.0 and support new services that will, in turn, drive economic growth and job creation for decades to come.

Adopting 5G this year could contribute 177 billion baht to the economy, or 1.02% of GDP. The intake could rise to 332 billion baht in 2021 and 476 billion baht in 2022.

The initial 5G roll-out in Thailand will focus on enhanced mobile broadband and fixed wireless access service to boost data bandwidth and connection reliability.

There remain no clear models for 5G service charges that could apply to vertical industries. Each operator is expected to make thorough studies to construct models.

Thailand is the first mover in ASEAN for the 5G licence auction, in contrast with the 4G bid in which the country came in late from a global perspective.

The difference is that there are still no 5G devices in the market, in comparison with the market featuring 30-40% 4G devices in 2015 when the 4G licence auction was held.

Gradual change

Telecom pundits, given that 5G tech still needs time to gain ground, the change in the telecom market throughout this year will be gradual. Services will continue to be dominated by 4G and enhanced mobile broadband.

Business use cases associated with 5G will be hard to find in the market, especially business-to-business features, as digital maturity is a necessary condition.

Vertical industries may be reluctant to fully invest in 5G tech, such as IoT devices or robotics, because of the prospect of an economic slowdown.

Despite these hurdles, major operators fought hard and spent heavily on 5G licences. Operators were compelled to snatch up licences to gain a marketing advantage.

Governmental participation

For the first time, state telecom enterprises TOT and CAT took part in the spectrum auction process. TOT won four slots on the 26GHz range while CAT snapped up two on the 700MHz range.

Industry veterans doubt that the participation of the two enterprises will heavily affect the 5G mobile services provided by major operators.

First, TOT’s 26GHz band will be too costly to roll out nationwide and will serve only to supplement the provider’s broadband business.

The 26GHz range is at a high frequency in which signals cannot transmit over a long distance and struggle to penetrate buildings or other obstacles.

CAT’s 20MHz of bandwidth on the 700MHz range, meanwhile, seems too little to provide 5G service better or faster than 4G services in terms of throughput.

According to the 5G technology standards by 3GPP, the 700MHz range will be used at full capacity for a full 30MHz (2x15MHz).

TOT and CAT joined the auction because of the DES Ministry’s policy of keeping telecom enterprises afloat after the core spectrum ranges, they hold expire in 2025. Both enterprises are also expected to provide public services via the spectrum holdings they won at the auction.

More business opportunities

5G is creating numerous opportunities in real estate, for example. Developers can create new revenue streams and build infrastructure to complement the massive increase in data usage and connected devices.

The aim is to build new smart homes, to find out how occupants use their property during the day or at night and use the data to design future properties.

The increased speed and interconnectivity provided by 5G will make collecting and analysing data through sensors in buildings easier across Thailand.

At commercial properties such as warehouses and factory estates, buildings could communicate with trucks by transporting materials in and out, while also sharing data with other buildings.

With greater data accumulation that would need to be stored, data centre construction is another emerging opportunity for the sector.

Some companies are already designing buildings with 5G in mind, specifically for smart city concepts, whereby a city would share information with buildings about traffic flows and air quality around properties.

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