Telecommunication Disruptions in Thailand Spotlight Shortcomings in Duopoly, Experts Urge for Equitable Market Competition
Market Remains Concentrated Amid Telecom Woes: Expert Warns of Service Quality Sag and Economic Risks
A significant network outage by True Corporation last week, affecting millions of users, has provoked concern over Thailand's ever-consolidating telecommunications sector. An expert, Dr. Somkiat Tangkitvanich, President of the Thailand Development Research Institute (TDRI), voiced warnings that the shrinkage of major operators to only two is compromising service quality and undermining the nation's digital economy objectives.
The outbreak of widespread outrage on social media following the multi-hour interruption highlights underlying problems emerging from recent industry consolidations, according to Dr. Somkiat. He points to a concerning trend—increases in service quality issues—post the True-Dtac and AIS-3BB mergers. A recent consumer survey has shown that over 81% of users reported network troubles over the past six months, with providers implicated in mergers experiencing the highest frequency of problems.
"In the current consolidated market situation in Thailand, we find that issues related to quality and frequency of outages have escalated, impacting both individual consumers and the business sector," Dr. Somkiat stated.
Extended business interruptions caused by prolonged outages instigate substantial economic damage, while the duopoly structure poses a threat to Thailand's digital transformation goals.
"A market with just two operators hampers Thailand's development towards a digital economy, which heavily depends on a knowledge base, IT systems, and the Internet of Things for industrial development, smart agriculture, and diverse services," he explained.
Dr. Somkiat advocated for the acceleration of market liberalization, particularly suggesting the opening of services to US companies. This move could bolster competition, reduce consumer expenses, and offer leverage in trade negotiations with the United States, especially as Thailand faces potential retaliatory tariffs when its delay expires in early July.
He also underscored the need for the National Broadcasting and Telecommunications Commission (NBTC) to enhance regulation and impose penalties on a par with international benchmarks. He referred to precedents:
- Australia fined Optus A$12 million (approximately 250 million baht) in 2022 for failing to provide emergency services during a nationwide outage
- The UK levied a £17.5 million (approximately 825 million baht) fine on BT in 2018 for system failures disrupting emergency calls
- Charter Communications paid US$15 million (approximately 500 million baht) in the United States for network outage violations
"To my knowledge, the NBTC in Thailand has issued warnings but has not imposed similar penalties on service providers," Dr. Somkiat noted.
In response, True Corporation acknowledged the outage and pledged to compensate users with 10GB of free data and 100 minutes of free calls for 24 hours. However, reactions from customers were predominantly negative, with many questioning the adequacy of the compensation given the scale of business losses incurred.
As Thailand targets its digital economy ambitions, the latest outage serves as a stark reminder of the risks associated with market concentration and the urgent need for regulatory reform to establish robust, competitively-balanced telecommunications infrastructure.
Related Stories:- True Corp acknowledges approval bias in NBTC's DTAC merger process- Public concern mounts over True's post-outage customer support- NBTC highlights True and DTAC's commitments to network performance and customer service- Thailand's path to IT sector leadership complicated by industry consolidation
- TAGS
- True Corp
- True Corporation
- Thailand
- Network
- Internet
- outage
- TDRI
- Thailand Development Research Institute
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- Dr. Somkiat Tangkitvanich, President of the Thailand Development Research Institute (TDRI), expressed concerns over the undermining of Thailand's digital economy objectives due to the consolidation of major telecom operators, leading to increased issues related to quality and frequency of outages.
- As Thailand aims for digital economy aspirations, the focus on investment in robust, competitively-balanced telecommunications infrastructure has become paramount, given the risks associated with market concentration and the urgent need for regulatory reform.
- Dr. Somkiat also advocated for opening services to international companies, particularly US firms, to bolster competition, reduce consumer expenses, and provide leverage in trade negotiations, as well as emphasized the importance of regulatory oversight to enforce penalties on service providers in line with international benchmarks.
