With only four months left until Thaicom's satellite operating concession ends, the SET-listed satellite service operator is convinced its outlook remains strong, driven by satellite-related smart solutions and diversified businesses.
The company operates Thaicom 4 and 6 satellites via a concession with the Digital Economy and Society (DES) Ministry, and operates Thaicom 7 and 8 satellites under a single licence from the National Broadcasting and Telecommunications Commission (NBTC).
Thaicom 4 is a broadband satellite for broadband internet access services, while the others are conventional satellites that support broadcasting and telecommunication.
Assets related to Thaicom 4 and 6 have to be returned to the DES Ministry after the concession ends in September.
The ministry assigned CAT Telecom to handle the operation of the satellites after Thaicom's concession expires, and that responsibility has now fallen to National Telecom, which was formed through the merger of CAT and TOT in January this year.
POSITIVE OUTLOOK
"We still have a positive outlook for the company's operation and business ecosystem despite several variables that could create uncertainty," said Thaicom chief executive Anant Kaewruamvongs.
He said its satellite business is still promising, particularly the space-air-ground smart solutions concept.
The vision aims to create new services based on the integration of various systems, such as satellites, unmanned aerial vehicles (UAV) and ground systems such as Internet of Things (IoT).
"The satellite business is not about basic telecom anymore. Players have to adjust for tech development and new business models to cash in on varied businesses driven by technological development," said Mr Anant.
The company has around 5 billion baht in cash flow, which he said is enough to drive business and operations forward.
Mr Anant said satellites not only serve TV and telecom businesses, but also can be used with UAVs for aerial photography linked with IoT devices on the ground.
Thaicom has been diversifying its business portfolio into digital solutions over the past two years to support its competitiveness and add revenue resources.
Diversified businesses include robotics, artificial intelligence and innovation development, he said. The company is also deepening its focus on the end-user segment.
According to Mr Anant, Thaicom is scaling up efforts to optimise its satellite transponder capacity to serve market demand and boost revenue.
He said the company is closely monitoring technological development of both geostationary and low-earth-orbit (LEO) satellites.
Regarding geostationary satellites, a consortium of satellite service operators including Thaicom are in the process of negotiating with satellite manufacturers to create new broadband internet satellites called software-defined satellites (SDS), said Mr Anant.
SDS can support flexible and fine-grained networks, improve collaboration between satellites and the compatibility of heterogenous space systems, as well as reduce costs.
The budget for the project has yet to be determined, pending more study of the end-user market, as the technology will compete with fixed broadband and fibre internet services, he said.
Regarding the LEO satellite business, Thaicom and CAT Telecom established a joint venture, Nation Space and Technology Co, with registered capital of 10 million baht to explore business opportunities in connection with LEO.
The joint venture should become a hub of satellite gateway service and a marketing arm for LEO satellite services in Cambodia, Laos, Myanmar and Vietnam markets, said Mr Anant.
LONG-TERM STRATEGIES
Thaicom outlined its long-term strategy to increase revenue streams.
First, it wants to focus on growth businesses, including drone technology. The company plans to develop an in-house flight control system, create a precision spraying drone service as well as build a digital platform for drone as a service.
Second, Thaicom plans to gear up for broadband services for vessels through its maritime service platform NAVA, as well as work with Thai and regional partners for the LEO satellite business.
LEO satellites operate 500-2,000 kilometres above the Earth's surface, compared with a height of 36,000km for geostationary satellites, which are considered the traditional type of communications satellites.
The advantage of the lower orbit is lower latency, which offers access to high-speed internet services.
LEO satellite service is also applicable to IoT devices, drones and applications in segments that require high levels of accuracy, he said.
ATTRACTIVE AMENDED DRAFT
The NBTC plans to auction off four packages for the right to use satellite orbital slots before Thaicom's concession expires.
Thaicom is believed to be a key competitor in the bidding.
The first package consists of 50.5°East and 51°E orbital slots; the second is for 78.5°E; the third involves 119.5°E and120°E; and the last is for 126°E and 142°E.
A second hearing on the auction draft was held in March this year.
Mr Anant said Thaicom reckons the amended auction draft revealed in the second hearing is "more attractive" than the original draft as it reduces the financial burden for bidders and eliminates ambiguous conditions.
The company is awaiting the final draft by the NBTC before it makes any determination, he said.
Thaicom is also exploring new opportunities, including gateway businesses for the use of foreign satellite capacity.
CONFRONTING CHALLENGES
The company's disputes with the DES Ministry over two cases remain in the arbitration process.
The ministry considers Thaicom 7 and 8 to be part of Thaicom's concession, demanding the company provide revenue sharing, but the firm insists the two satellites are operated under a single licence from the NBTC, for which it has to make a licence fee payment to the regulator.
Another dispute concerns Thaicom's deorbiting of the Thaicom 5 satellite in February 2020 before the concession expired.
The ministry demands Thaicom build and deliver a replacement satellite for Thaicom 5, or pay compensation of around 7 billion baht if it cannot do so.
Thaicom argues the ministry was informed in advance about the satellite's lifespan, which was due to end in 2018, before it was approved for launch.
The company also indicated it consulted with the DES Ministry and NBTC, seeking approval before deorbiting the satellite.
Thaicom has also come under close scrutiny after its parent InTouch Holdings was targeted for acquisition by SET-listed Gulf Energy Development, the country's biggest private power producer by market value.
It is unknown whether the buyout will materialise, but market analysts believe if it does come to pass, the purchase would have a profound effect on Thaicom.
Mr Anant retires at the end of this year and his incumbent deputy, Patompop Suwansiri, is tipped to become his successor.