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Dtac defends Line Mobile as Thai regulator queries its legal status

Dtac defends Line Mobile as Thai regulator queries its legal status

Thailand’s regulator NBTC is investigating whether the dtac-owned Line Mobile service is in fact legal.

The controversial service is launched this week following three months in beta, and while it is an independent entity it is owned by a subsidiary of dtac, which is the third largest player in the Thai mobile market. Line Mobile offers voice and data via dtac’s network.

NBTC secretary general Takorn Tantasith noted that the regulator did not wish to interfere with Line Mobile’s operations without a full understanding of its operating situation. He noted that the regulator would be monitoring Line Mobile’s launch to check its legality. Line Mobile executives will meet with the regulator to discuss the matter.

Reportedly, Thailand’s two largest operators – AIS and True Move – have both pressed the NBTC to make it clear whether Line Mobile is violating the law by providing services without an operating licence. A ruling is expected within 30 days.

Somchai Lertsutivong, chief executive of AIS, has argued that Line Mobile’s model is similar to an MVNO and that it should therefore require a licence to deliver mobile services. He expressed his concerns over Line Mobile’s ambiguity, claiming that the service could set a bad precedent as other companies would begin offering mobile services without paying the required licence fees.

Line Mobile Thailand is a subsidiary of Japan’s Line, which runs an eponymous messaging service. The Thai company’s CMO Pavarisa Chumvigrant claimed that dtac’s unit was permitted by Line to use the Line Mobile branding. He noted that Line does not use an MVNO business model, but that this had already been cleared by the NBTC.

Dtac head Lars-Ake Norling has claimed that Line Mobile is in fact a marketing scheme, arguing that it doesn’t require an MVNO licence of its own as it is operated as a dtac subsidiary. dtac has the right to use Line’s branding and technology, but all of Line Mobile’s revenue ultimately belongs to dtac.

Norling said: “The deal does not create a separate corporate entity or entitle Line Thailand to any part of the revenue generated by the service.” He noted that Line Mobile is required to pay all applicable government fees, just as dtac is.

Line Mobile allows its 10,000 customers to use free Line services, including video calls, messaging and Line TV, without using up their data packages. It also offers rates that are significantly lower than dtac’s regular mobile service, which Norling claims is due to its efficient operating structure.

Dtac has a 26% share of Thailand’s mobile market, putting it in third place but only slightly behind number two True Move, which has 27%.