In the paper "Financial Analysis of Thai Internet Service Providers" Rear Admiral Prasart Sribhadung of Assumption University analyzed the financial status of Thai Internet Service Providers (ISP) after ten years of operation.
"It has been openly speculated all along since the early days of ISPs in Thailand that most of the ISPs with few
exceptions are not making any profit since they started operation. Nobody really knew the truth, how bad the situation was, or what was thecause, but some ISP ceased operation, and some sold out their businesses" he says
Internet usage in Thailand is increasing, and the report confirms that revenue of ISPs are increasing, but also
increasing is the operating cost of ISP services.
There are several variables that can be used as indicator of Internet growth, e.g. Internet Users, Internet Revenue, Internet Domains, and both Internet International and Domestic Telecommunication Links used in Thailand.
ISP Financial Information of the seventeen ISPs indicate alarming results which confirm that most ISPs are experiencing accumulated losses, except for Internet Thailand, which has some special privileges, because it was a government agency from start, and all shareholders paid their own share including CAT.
It started with a very tiny loss (30,000 baht), which was a bit unrealistic for a new star-up business, then recorded huge profits every year, accumulated profits to 473.5 million. It is the only one of eighteen ISP making huge profits with stability.
KSC the pioneer company limited ISPto joint venture with CAT (32% freeshares of 15 million) was even more unrealistic, made profit from the first year of operation and continued for six years then suffered significant losses and
ended with a sizable accumulated loss.
ANET operated normally, started making profit the fourth and fifth year approaching the break-even point, then three years of huge losses, after that recovered with two years of profit. It is still in the reds, the paper concludes
So why is this possible? How is this huge discrepancy taking place?
"Government enterprises enjoy more favourable financial conditions, resulting in lower operating costs. More research is going to be needed to assess implications and find a solution"
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