Third-quarter revenue growth in the mobile business averaged 2.7%, compared with 5.4% in the same period last year.
Mobile operators have been strict in managing operational expenditures to boost revenue growth, but increased marketing budgets to draw new customers as Total Access Communication's (DTAC) mobile concession on the 850- and 1800-megahertz bands expired in September.
The lower revenue growth came from falling return of investment capital since 2016 because of the financial burden of annual infrastructure investment and the cost of spectrum licence payments.
An analyst from Kasikorn Securities (KS) who requested anonymity said the declining growth in the third quarter may be short term because of the higher marketing budgets in the battle for new subscriptions.
Revenue growth for the first nine months for the three major mobile operators averaged only 3.4% compared with 6.4% for the same period in 2017.
The KS analyst said investors are pinning their hopes on better operator performances in the last quarter after DTAC's concession ended and several competitive promotions were introduced.
"I expect an improving trend for the three mobile operators' performance in the last quarter, averaging 4-5% revenue growth. 2019 should be the year they harvest benefits from 4G infrastructure investment," said the analyst.
The KS analyst said average revenue per user (ARPU) in the overall market must gradually increase as customers' consumption of bandwidth grows in line with digital lifestyles.
If the decline in growth of mobile service revenue continues for major operators in 2019, it would adversely affect their future investments, especially for 5G wireless broadband.
The three major mobile operators have had enormous financial burdens from the 3G and 4G licences they won in previous auctions, which saw winning bids total 270 billion baht.
Their annual investment for network expansion saw each operator spend some 100 billion over the past three years.
"If the ARPU of the overall mobile business declines and the earnings before interest, tax and amortisation margin drops in 2019, these will be bad signs for the telecommunications sector and 5G adoption," said the analyst.
The analyst said market competition this year is more promising than in 2017 and competition will continue to intensify going forward.
As of September 2018, AIS had 40.6 million total mobile subscribers, followed by TrueMove and DTAC at 28.7 million and 21.3 million, respectively.
