Thailand's Total Access Communication PCL (TAC) DTAC.BK said on Tuesday it expected to launch a third generation (3G) mobile service in the first quarter of 2009, which should generate revenue in 2010.

The initial launch of the high-speed broadband Internet would be in the capital, Bangkok, and TAC planned to launch in cities such as Chiang Mai in the north and Phuket in the south after that, chief executive Sigve Brekke told reporters.

"In the first year of the launch, we don't expect much revenue. The first year should be for positioning as technology leader in the market," he said.

The country's second-largest mobile phone operator, which got the go-ahead to import 3G equipment from the Thai regulator last week, will select a telecoms equipment vendor in the next 4-5 weeks to supply gear for the first phase worth 1.1-1.2 billion baht ($32-35 million), Brekke said.

Among the equipment makers are Nokia Siemens Networks [NSN.UL], Ericsson and China's Huawei Technologies [HWT.UL], chief operating officer Thana Thienachariya said.

TAC, controlled by Norway's Telenor, planned to spend 5 billion baht to upgrade the 3G services on its existing 850 MHz frequency as part of its move to tap new revenue in a nearly saturated sector.

TAC, which cut its 2008 revenue growth forecast to 5 percent due to weak consumer confidence after reporting second-quarter earnings in July, would try to beat the new target by attracting more users in rural areas and new promotions, he said.

TAC launched a marketing campaign this week in which new clients will earn 0.50 baht per minute when receiving calls from customers of rival networks, a move that should encourage more mobile use, he said. 

The company expected the number of new subscribers in the second half of this year to be close to the 1.8 million added in the first half, Brekke said.

TAC has about 30 percent of Thailand's mobile phone market, where the penetration rate is expected to reach 95 percent at the end of this year.

Its rivals are market leader Advanced Info Service ADVA.BK and number three True Move, a subsidiary of True Corp TRUE.BK.

At 0734 GMT, TAC shares were down 1.14 percent at 43.50 baht, in line with the overall market. ($1=34.01 Baht)

Source:Reuters