Thai govt agrees $650 mln 3G budget for state firm

BANGKOK, Sept 28 Tue Sep 28, 2010 3:52am EDT

BANGKOK, Sept 28 (Reuters) - Thailand's government approved a budget of 19.9 billion baht ($650 million) on Tuesday for TOT Plc, a state-run telephone firm, to invest in third-generation technology on its existing network.

The approval came five days after a court ordered a halt to the auction of third-generation mobile licences on new 2.1 GHz frequencies, which may have set the country back another few years in its attempt to adopt high-speed mobile phone services.

The court injunction followed requests by TOT and another state firm CAT Telecoms Pcl, which said the existing regulator did not have the authority to offer 3G licences and that their interests would be hurt if it went ahead. [ID:nSGE68G0AW]

"The cabinet approved a plan to develop 3G by setting up a subsidiary firm for the operation," Minister of Information and Technology Juti Krairerk told reporters, adding plans could be ready within six months for Bangkok and up to 15 other provinces.

TOT already offers a limited 3G service on its 1900 MHz spectrum and wants to upgrade its existing 500 base stations with 3G technology and install 5,220 new stations. International handsets and smartphones mostly work on the 2.1 GHz frequency.

Top mobile firm Advanced Info Service Pcl (AIS) ADVA.BK has also launched a limited 3G service on existing networks covering a few big towns.

The 3G licensing would have changed the way operators pay fees to the government, a crucial step in reforming the $4.7 billion sector that could eventually lure more foreign players. ($1=30.57 Baht) (Reporting by Kitiphong Thaichareon and Khettiya Jittapong; Editing by Alan Raybould)

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