Internet Thailand Internet Thailand & &

Pre-paid Internet in Thailand Pre-paid Internet in Thailand

Morragot Kulatumyotin

Internet Thailand Public Company Limited

November 21, 2001

Thailand Internet indexThailand Internet index

• 18 commercial ISPs• 2 domestic Internet exchanges: CAT-NIX and

NECTEC-IIR• 642 Mbps total international bandwidth (in)• 526 Mbps total international bandwidth (out)• 3.5m Internet users

As of Nov 01

ISP market in the countryISP market in the country

• A-net Internet• Asiaaccess • Asianet• Chamanan worldnet • CS Internet • Data Line Thai• E-Z net• Fareast Internet

• Idea Net

• Internet Thailand• Jasmine Internet• Loxinfo• KSC• Pacific Internet• REACH (Thailand)• Roynet• Samart Internet• Siam Global Access

Moving away from ‘pure’ access to e-commerceMoving away from ‘pure’ access to e-commerce

Portals ASPs E-Commerce

Hosting Network AppsAnd Data

Intelligent Distribution

Access Broadband Backbone

Thailand Internet model still in the “pure’’ access stage

Market moving towards content & application providers

Inet roadmapInet roadmap

• Granted first ISP license under the name ITSC• Thailand’s first commercial ISP

• Established Internet Thailand Co., Ltd.• Granted second ISP license under the name INET

1992

• Received ISO 9002 from SGS• Converted to Public Company Limited• Privatization (Go Public)

The Cabinet approved the establishment of Internet Thailand Co.,Ltd

1996 1997 20011995

Evolved from the academic network run under the name “ThaiSarn”

Shareholders’ structureShareholders’ structure

PublicPublic NSTDANSTDA

CATCAT

TOTTOT

EmployeesEmployees

17%

16%16%

7%

44%

No. of shares : 250 Million shares

Nature of businessNature of business

• Internet Service Provider (ISP)• E-business Infrastructure Provider

Core servicesCore services

• Connectivity• Internet Data Center

– IDC/hosting– ASP– Colocation– collaborative commerce– e-commerce

Company infrastructureCompany infrastructure

IIR (NECTEC)

A-Bone (Japan)

TeleGlobe (USA.)

IIG (AT&T

network)

NIX (CAT)

Inet’s Backbone

200 Mbps

512 Kbps

45 Mbps(cable)

2 Mbps(cable)

8 Mbps(cable)

Domestic Connectivity International Connectivity

Business visionBusiness vision

The company’s vision is to become the

PerformancePerformance

140

219

310

428

104144

237

324

2553 51 73

0

100

200

300

400

500

1998 1999 2000 2001

unit: mil. baht

revenue operation expense net income

Pre-paid Internet in ThailandPre-paid Internet in Thailand

Dialup service evolution in Thailand Dialup service evolution in Thailand

1995

1998

2001

Monthly basis service

Pre-paid and pay per use basis service

Time-zone basis service

Unlimited basis service

Free Internet

Inet implementationsInet implementations

• In-house development• In 3 years since market launch, there is

no successfully cracked ticket. (use strong encryption algorithms)

• about the same time as prepaid cell phone

• co-branding

Nationwide coverageNationwide coverage

CAT pricing regulationCAT pricing regulation

• Individual services– monthly basis: start up B.300, monthly B.900/20

hours, extra charge B.40/hr.– prepaid: B.600 for 10 hours, >= 10 hours =

B.50/hr.

• This is a ceiling.• There is no minimum rate. (after Sep 4, 97)

(did not reflect market reality)

Pricing evolutionPricing evolution

• Monthly basis– 900 baht/20 hours/month = 45 baht/hr.

• pre-paid basis– 1998: 30-40 baht/hr.– 1999: 20-30 baht/hr.– 2000: 10-25 baht/hr.– 2001: 3-15 baht/hr.

PerformancePerformance

140

219

310

428

104144

237

324

2553 51 73

0

100

200

300

400

500

1998 1999 2000 2001

unit: mil. baht

revenue operation expense net incomeNet profit grows 3-fold in 3 years

• Unlimited basis– 300 - 500 baht/month at 1-5 hours/session

• Free Internet– domestic only (TOT)

Where to buy, where to pay?Where to buy, where to pay?

• Via vendors (book shop, retail store, convenience store)

• Via mobile phone (WAP)• Via banking services

• Via web site (package, refill)

• Via credit card/e-commerce• Via ATM machine

Why is pre-paid Internet popular in TH?Why is pre-paid Internet popular in TH?

synergysynergy

• convenience, can buy

anywhere

• many package sizes

• flexible/ fair usage

• no commitment to ISP

• positive cash flow• varied distribution channels

USERUSER ISPISP