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Block DTAC-True Merger, Thai Think Tank Says, Arguing It Will Hurt Consumers

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The Thailand Development Research Institute Foundation said the planned merger of telecom giants True Corp. and Total Access Communication will further winnow competition and hurt consumers.

The think tank recommended that the merger be blocked. It added that if DTAC wants to exit the market, it should sell its business to companies that are not one of the two remaining key players comprising True and Advanced Info Services.

According to TDRI, the number of main telecommunication service providers in Thailand should be no less than three, in order to encourage competition.

The agency nevertheless suggested that the merger could still happen, under the condition that licenses to operate some of its frequencies be returned to encourage other operators to step in. Another option would be to offer users other choices of service providers by means of mobile virtual network operators. An MVNO is a mobile operator that lacks its own cellular network and rents from other networks to provide services.

TDRI further noted that shares of all three telcos surged following news of the merger, reflecting market sentiment that favors operators but limits choices for consumers, retailers and innovators.