By Srisamorn Phoosuphanusorn

Thailand's telecommunications industry is in a critical transition period as it prepares to adopt new technology that will bring major changes in the nature of the business.

Operators have been dramatically reshaping their organisations and business models in anticipation of intense competition with the arrival of third-generation (3G) technology.

With its promise of much higher transmission speeds for voice, data and other applications, 3G will also usher in so-called ``triple-play'' businesses offering their customers voice, Internet and television all in one. It could be all on one monthly bill as well, which is the tricky part. Companies are still trying to determine what consumers will want and how much they will be willing to pay for it. To date, 3G has been a costly flop in most markets where operators paid huge sums for licences; only South Korea could be considered a success story.

Still, Thailand's major telecom operators are growing more confident about investing in the costly 3G business, as the cost of getting left behind should the business take off will be even higher. The rapid convergence of voice, data and multimedia leaves them little choice.

Operators have been remaking themselves by resolving challenges related to technology and service deployment, network construction strategy, business and long-term partnership synergy.

The takeover by Norway's Telenor of DTAC, the country's second-ranked mobile provider, in anticipation of further liberalisation and convergence, best reflects the current state of play. In short, any company that wants to compete will need size and deep pockets.

Telenor effectively took over United Communications Industry (Ucom) and its Total Access Communication (DTAC) arm in October, sending the founding Bencharongkul family to financial freedom and telecom retirement. The 9.2-billion-baht deal puts the Norwegian strategic partner firmly in the driver's seat of the Thai firm, while both Boonchai and brother Vichai Bencharongkul have stepped down from their positions as president and co-CEO.

Following the takeover of Ucom, rumours emerged within the industry about the likelihood of similar share purchases in other companies, even including Shin Corp, which was founded by Prime Minister Thaksin Shinawatra.

Shin has denied newspaper reports that the Shinawatra family might sell out its controlling stake of more than 38% in Shin, the parent of Advanced Info Service (AIS), to China's biggest fixed-line phone company, China Telecom, to raise funds to set up a company to operate a 3G telecom business.

Another rumour was that AIS, the local market leader, would sell a huge share to its existing foreign strategic partner Singapore Telecommunications (SingTel) to raise funds.

Khunying Potjaman Shinawatra, Mr Thaksin's influential wife, herself denied the reports, but such speculation nevertheless reflects what is happening in the telecom industry as foreign firms look for local partners to team up in the costly 3G business.

In another development, True Corporation surprisingly announced that it was taking over its sibling pay-television operator United Broadcasting Corporation (UBC) in November, in a deal worth up to 11.8 billion baht.

True bought a 30.59% stake in UBC from MIH Holdings for around six billion baht. The transaction has boosted True's holding in UBC to 70.74%. True will also launch a tender offerer">Telecommunications: