To: Allan Rasmussen, Yozzo, Managing Director, part 1 Dear Allan, Thank you for your comments. Your perspective on the challenges faced by Mobile Virtual Network Operators (MVNOs) and Mobile Virtual Network Aggregators (MVNAs) is valuable. It is indeed frustrating to see their potential hindered by an inadequate regulatory structure. Something needs to change to promote competition in mobile communications. I am working with the National Broadcasting and Telecommunications Commission (NBTC) to find the best solution for Thailand. I understand the challenges we face with the current regulatory framework. Enforcement is indeed an issue, and it's not unique to Thailand. For instance, coverage and buildout obligations, though frequently included in license conditions, are not effectively enforced. The administrative definition of these obligations is complex, and enforcement is often impractical. The current policy is not the best solution. We need to align incentives to promote competition and foster innovation. Regulatory mandates have proven ineffective, as regulation often lags behind technological advances. The TIMO structure I propose is effective. It holds the potential to significantly improve the landscape of mobile communications in Thailand. By aligning incentives with social welfare and encouraging continuous improvement through transparent markets with effective governance, we can foster innovation and competition. This approach, with its strong theoretical basis and decades of successful application, offers a promising future for the industry. By contrast, the approach you propose-better enforcement of existing policies-is ineffective in many countries. The FCC has struggled to make license conditions effective in the US, such as buildout and coverage obligations. Enforcement has failed, even after repeated attempts to improve the rules. Approaches that rely on market incentives have worked. Fixing the regulatory framework would better align incentives. As an aside, your assertion that my team has little local knowledge is incorrect. My team includes a key member with more than twenty years of experience in Thailand and addition to his international experience. Our extensive global experience gives us an understanding of mistakes to avoid and successes to exploit. Our judgments are informed, and our independence is established. Let me focus on the situation in Thailand. I understand that the carriers have largely ignored the MVNO capacity requirements established to promote competition and regulatory enforced has been weak. I accept your legitimate concern. The problem with this approach is that it is easy for the carriers to evade the regulation by failing to sign contracts that promote competition. This is not surprising. A symmetric duopoly is perhaps the most collusive market structure-see "One is Almost Enough for Monopoly" by Lawrence M. Ausubel and Raymond J. Deneckere, RAND Journal of Economics (1987). Mandating a company to take action against its interest is not a successful path. In the merger remedy, NBTC redoubled its efforts to address the merged entity's reluctance to sign contracts and encourage successful MVNO entry. I agree that effective regulation of True and AIS would not "negatively impact spectrum or retail pricing -in fact, it would help." Effective regulation increases the value of the carrier's networks when done well. MNOs and MVNOs benefit from the larger pie created by a competitive and innovative communications market. Ultimately, competition benefits everyone, especially Thai consumers. Still, every duopolist will resist competition. The gains from competition bring risks-as AT&T and Verizon are experiencing with the success of T-Mobile US. Yes, "a context-specific strategy is needed-one that prioritizes practical solutions." That is what I am working on. It will not be easy, and it will not be instantaneous. However, it is practical and has proven successful in other sectors and countries. It is also innovative. That is how progress is made. The merger of True Corporation and Total Access Communications (Dtac) in Thailand was a significant event that transformed the telecom market into a duopoly dominated by True and AIS. As part of this merger, NBTC mandated that at least 20% of the combined network capacity be available to MVNOs, aiming to mitigate potential anti-competitive effects. However, concerns have been raised by you and others about the implementation of these measures and the overall health of the MVNO ecosystem in Thailand.

Part 2 NBTC's conditions were established to foster competition and prevent monopolistic practices in the telecom market. The regulator emphasized that MVNO access should be guaranteed without discrimination and within specific timelines. NBTC established detailed conditions to ensure nondiscriminatory access for MVNOs following the merger. Key provisions include: • Guaranteed Access to Network Capacity. The merged entity must allocate at least 20% of its total network capacity to MVNOs that are not affiliated with the company, ensuring fair access upon request. • Non-Discriminatory Practices. The merged entity is prohibited from refusing service to MVNOs based on claims of insufficient network capacity. Access must be provided under equal terms and quality standards outlined by NBTC regulations. • Timely Service Activation. MVNOs requesting access must be able to start using the network within 60 days of their request, ensuring prompt service availability. • Quality Standards. The quality of service provided to MVNOs must align with the standards set by the NBTC, guaranteeing that MVNO customers receive services comparable to those offered directly by True. These measures are part of broader regulatory remedies intended to mitigate potential anti-competitive effects of the merger, alongside commitments to maintain service quality, reduce prices, and expand 5G coverage. However, implementation has been scrutinized, with concerns raised about the actual execution of these conditions and transparency in reporting progress, as you explain at www.yozzo.com/industry-news/the-true-telco-merger-in-thailand-has-a-plan-for-the-provisions-of-mvnos/. There are specific conditions on the pricing terms between True and MVNOs that request network capacity. NBTC imposed these conditions to ensure fair and competitive access for MVNOs. The key pricing-related measures include (see www.nationthailand.com/thailand/economy/40021269 and your summary www.yozzo.com/industry-news/the-true-telco-merger-in-thailand-has-a-plan-for-the-provisions-of-mvnos/): • Wholesale Pricing Cap. MVNOs' wholesale compensation rate must not exceed the average service fee offered per unit of each service (e.g., voice, data, SMS). This wholesale price must be at least 30% lower than the retail price for bundled packages or individual services. This ensures MVNOs can offer competitive pricing to their customers. • No Minimum Purchase Requirements. The merged entity cannot impose minimum limits on the purchase of services (e.g., voice, data, SMS) by MVNOs. Charges must be based on actual usage, allowing MVNOs flexibility in managing their costs and offerings. • Transparency and Cost Verification. The merged entity must submit cost information and necessary data to an inspection agency. This measure ensures pricing transparency and prevents anti-competitive practices such as margin squeezes. Despite these pricing conditions, MVNO entry still faces challenges due to high wholesale costs and limited access to network capacity. My proposed Thailand Independent Market Operator (TIMO) is the solution. TIMO aligns the incentives of the regulator, MVNOs, and carriers toward maximizing social welfare. This is a successful-well-tested-path to competition in Thailand communications. TIMO's mission is "To encourage competition and innovation in mobile communications through efficient and transparent trade of wholesale capacity." Like the Independent System Operators (ISOs) from the US electricity sector, the mission is operationalized by translating the mission into economic and mathematical terms: • "We address potential market failures, including incomplete markets, incomplete information, market power, entry barriers, and systemic risk." • "We conduct transparent and efficient markets by pricing communications to maximize social welfare subject to network and resource constraints." Wholesale electricity has many similarities with wholesale communications; both are network industries with substantial shocks to supply and demand by time and location, requiring that efficient open-access pricing is defined by time and location. Market participants must manage needs and risks through forward trade. The key difference is that communication is simpler. The consequence of rationing when demand is greater than supply is less costly. Supply and demand must be balanced every second, or the lights will go out on electricity. Thousands of network and resource constraints must be satisfied, or essential equipment would be destroyed. Communications is much more tolerant of supply and demand imbalances. This is why today's communications markets work despite poor congestion management. Communications has more flexibility in real time, which is why we see effective congestion management in electricity but not yet in communications. TIMO introduces efficient congestion management through pricing-an approach used in highly evolved designed markets such as electricity and finance. Adam Smith's The Wealth of Nations presented the core idea and has been the centerpiece of economics ever since. From a regulatory perspective, the essential element is measured use. Carriers do this today. Every communication is measured by time and location. With measurement, it is possible to price use by time and location. Open access prices the resource-consumption of the communications commodity-with efficient pricing, derived mathematically from the dual of the optimization of as-bid total welfare. This may sound complex, but it is easy since this step rests on the most basic and powerful ideas from optimization theory-convex optimization and duality theory. My recent publication in Telecommunications Policy, 2024, www.sciencedirect.com/science/article/pii/S0308596124001174, explains the details. As with any significant regulatory innovation, TIMO will take time to establish. It can be designed and implemented in Thailand in two years. The bottleneck is the regulatory stakeholder process. My team has already built a state-of-art trading platform, which is open source and freely available in early 2025. Does this delay harm a timely auction in mid-2025? No. As long as NBTC establishes initial progress and intent before the auction starts, bidders can properly include regulatory and market uncertainties in their bids. This is how auctions work. Bidders inevitably face regulatory and market uncertainties. The bidders' bids translate their bids into market prices for the scarce spectrum input needed to provide communications services. I look forward to your continued participation in developing TIMO to foster competition and innovation in Thailand's communications market. I encourage you to represent your interests. With time, you will see that TIMO is consistent with your interests. TIMO will enable you to offer innovative solutions to potential MVNOs and MVNAs as they seek to create value for Thai consumers. Kind regards, Peter Cramton University of Maryland Max Planck Institute for Research on Collective Goods Cramton Associates LLC (Forward Market Design LLC after 1 January 2025)

@@PeterCramton The NBTC has failed to enforce existing rules and policies for over a decade. Yet, the solution you propose is to establish a new, unproven bureaucratic entity that relies on the same flawed foundation: enforcing rules. Your proposal provides the NBTC and telecom operators AIS and TRUE with exactly what they need right now-a way to further extend their negligence of duty. The option to continue to neglect enforcement on the existing policies was running out. i.e.: - The MVNOs at NT have to get access at AIS or TRUE, as the remaining spectrum at NT is not enough. - TRUE has been talking with MVNA and MVNOs for months, anticipating that NBTC might require contracts with X MVNAs/MVNOs before TRUE could join the auction. - Several MVNA/MVNOs are preparing to file dispute cases against AIS and TRUE, as AIS/TRUE’s deadline for adhering to the Request for Access are running out at year-end. - MVNA/MVNOs are also ready to petition the NBTC for negligence of duty. - The Senate ICT Committee has criticized NBTC’s lack of enforcement and seeks to remove its Chairman. - Consumer organizations have filed petitions at the Courts accusing NBTC of neglecting its duties. - Thailand’s FTA negotiations includes telecom competition - Thailand’s membership aspirations in the OECD, who sees little benefit in mobile operator consolidation but MVNOs as an important element to increase competition in mobile markets, especially if they can act as full-MVNOs. - The NBTC “Superboard” which is monitoring NBTC’s (lack of) work has deemed the agency’s performance a failure. - Public frustration is escalating with the lack of competition and increased pricing in the telecom sector, flooding social media with demands to disband the NBTC board. Some are even threatening extreme actions, including killing themselves in front of the operator’s headquarters. Rather than joining this deadline call for NBTC to regulate, you are instead handing NBTC, AIS and TRUE a bureaucratic beast on a silver plate, which will take years and a range of committees to discuss, followed by another set of years to agree on what policies and qualification should be used to select the people, who will be appointed in a year long hiring process to sit on such. That way the NBTC can say continue to say “but we are actively working on... “, as they done for a decade already, and AIS/TRUE can say... “we are always open for opportunities and supporting the country but we have to wait for the NBTC”. In summary, your solution is the recipe for the delay the are seeking, enabling the NBTC and operators to maintain the status quo while avoiding accountability. If you goal is to come up with a new problem that can delay further, then yes! TEMU is the solution. But if you are looking to solve the problems, then enforcing the rule of law, before launching an auction that will determine the next 15 years in the Thai telecom sector - is the only solution.

You are most welcome