What new initiatives is DTAC currently involved in?
ABDULLAH: I want to focus on what out strategy is, and it is to provide internet for all. What that means is that, by 2015, we want to make sure that every customer we have has a mobile internet experience. So really everything that the company is doing is to support that. The first initiative is 3G coverage, build a network. Make sure that we can cover the population as fast as we can. The second one is to get low cost devices; to get low cost smart phones out there so that once we have a network, people can access it on an affordable handset. The third is how do we get packaging and pricing in bite size, whether that is hourly or daily or weekly, so that people can afford to get connected. Those 3 primary initiatives, we believe, are going to lead to internet for all. If we do that, we think we can really improve lives.
Letâ€™s bring great services to our customers. It is not just about voice and SMS. It is not just about internet and social. It is about financial services, it is about purchasing commerce, it is about e-Government and e-Education, and the list goes on and on. We are just at the cusp of putting the device to work. So I think it is services and meeting our customerâ€™s demands going forward.
How are ARPU levels changing with the shift from voice to data usage?
ABDULLAH: When we transition from voice and SMS, itâ€™s really a fundamental change in how people look at their wallet and what is valued. What I hope happens is that, when we go from voice and SMS to data, the ability through social networks and the ability to connect to anyone in the world should technically have more value than traditional voice and SMS services. So I am hoping that we will see a slight increase in ARPU overall. I do not think we can change it fundamentally up until we begin to bring in more feature rich services. For example, financial services, which is a new part of the wallet, entertainment, new part of the wallet, the ability to do something completely different, advertising or something else, that is where we can start to change it in a material way. Over time, I still believe that data and internet access is more valuable than voice and SMS.
How do you see Thai operators coping with the transition from 2G to 3G? How do you think they will cope with the future implementation of 4G?
ABDULLAH: Thailand has a long and complex history of concessions. A year ago we finally had the emergence of licensing through the 2.1 auction, which is leading to 3G services under license. What you are seeing is massive investment, all three operators running hard and building out network, which provides better service at lower cost. That is happening today. So I am very bullish on the road ahead based on 3G. The regulator has done a great job. Now what concerns me is that they do not get credit for that and I think we are too critical at times. This is going to add GDP to this nation and 3G is going to have a profound impact. The problem is, we are already too successful. In some areas, we already have congestion on our 3G networks. The solution, we have to go to 4G. Specifically in the urban areas and specifically in Bangkok, if we do not get 4G, people will not be happy with the speeds they get going forward. So we are very interested in working with the government in a constructive way to get 4G frequencies out there so that we can keep this level of service going.
What is DTACâ€™s market position?
ABDULLAH: Weâ€™re a strong number 2. We are at about 32% revenue market share, so a very strong position. It is extremely competitive because in this position, from concession to license, people actually have to make a port, meaning they are porting their number from one company to another â€“ even if it within your own company. When you make that decision, people look at the devices that are out there, the packages that are out there, the quality of the network, who has the best, who has the most. So right now, I would say that it is very competitive. What I hope happens is that we as an industry do not destroy our market because the customer will end up paying for that. We wonâ€™t do as much up-country, we wonâ€™t roll out as fast, we will come back and try to be a little bit more profitable. So I hope we do not over compete and destroy ourselves.
Ideally, how do you see DTACâ€™s unused bandwidth being utilized?
ABDULLAH: We believe that if spectrum is not utilized in the best way for the state, then that should be put back into auction. We believe that the upper band that we have is probably best suited to go into next years auction. We are working with the regulator to see if it is possible, it is quite a complex scenario. If we canâ€™t do that, we are also working with the regulator on whether we can use it under concession? Can we get 4G services in there if we canâ€™t get to auction? Thirdly, is it possible to work with a state agency under a different model to use that frequency to bring 4G services? The short story is, we believe Thailand is ready for 4G and we want to get 4G there, but we are not sure how best to use the spectrum that we have to get it there. I think we just have to let the process take place.
In some areas, we already have congestion on our 3G networks. The solution, we have to go to 4G. Specifically in the urban areas and specifically in Bangkok, if we do not get 4G, people will not be happy with the speeds they get going forward.
What do telecommunications mean to the economy and GDP of Thailand?
ABDULLAH: Direct correlation to positive upliftment. We know telecommunications has a direct correlation to GDP. We have seen it when we went from 2G to 3G, we have seen it when we went from feature to smart phone, and we also see it when we go from pre- to post-paid. So all of these migrations lead to greater efficiency and they lead to greater services and productivity and that leads to greater GDP. It is a fact. Coming back to the Thai situation, we believe that telecom can help. We believe that with AEC coming in 2015, if we do not provide world-class telecom services, we could fall behind our neighbors and I do not think anyone wants to see that.
What does DTAC do to support Thailand?
ABDULLAH: I believe in todayâ€™s world, going forward, that you cannot be just a capitalistic greedy company. I think we have all learned lessons in recent history that it does not bode well for the future. So at DTAC we have what we call the soul of the company. We must give back. We have a job, we are profitable, we have a great place to work, and we have a community of 5000 employees working together. How do we use that resource to give back or to give thanks? 2 or 3 initiatives primarily: 1m hours of internet access to children annually, meaning we are wiring schools to give free access to the internet to help in education. Our employees are actually donating their time to ensure the wiring is done and the students and teachers know how to use the equipment. Thatâ€™s one example.
The second example, we have donated 3 days of time per employee to do community service. That could be internet for schools, that could be helping someone in a convent or religious setting, it could be helping students, whatever the employee wants to do to give back, we support that both on the specific issue and on the more broader based programs. The third to me is simply being a good corporate citizen, that we are following the laws and rules of the land, that we are protecting people with our health and safety to ensure the companies that are working with us abide by health and safety regulations. We make sure that everyone that is associated with us is held to a higher standard. So if I kept it to those 3 areas I think we are making a positive impact on Thailand.
Looking ahead, what do you see as the positive telecommunications trends and what remains a challenge?
ABDULLAH: Social is unbelievably huge. Social networking in Thailand is almost a one to one between Internet access and a Facebook account. We have 2 of the most Instagramed locations on the planet: Suvarnabhumi Airport and Siam Paragon. Everyone in Thailand wants to talk to everyone and tell each other everything. So social is a humungous trend. We are seeing very strong growth in smart phone devices. People want to get connected to the internet and it will not be through a pad only or a computer, it will be through a mobile phone.
What I hope happens is that we just donâ€™t chitchat with each other. I hope this leads to more educational purposes. I hope this adds to commerce in a business sense by putting more feature rich content. We do not have enough local content. How do we develop the local ecosystem in the Thai language to bring interesting content? That can be entertainment, that can be business, education, that can even be government. So we are trying to find a way to fit this all together to ride the social network trend. I have to believe we can succeed.