UPDATE 1-Thai mobile firm AIS may raise 3G investment budget

* Had planned $1.5 bln investment over three years

* Regulator bypasses 3G licences to more advanced 3.9G (Adds details)

BANGKOK, June 15 (Reuters) - Advanced Info Service ADVA.BK (AIS), Thailand's top mobile phone operator, said on Tuesday it may raise its investment budget for third-generation mobile services due to the advanced technology now required for new licences. The telecoms regulator plans to issue licences in September for 3.9 generation mobile services, bypassing 3G services, which have never got off the ground in Thailand because auctions for licences have been repeatedly delayed for at least five years.

"We have to look at terms and conditions for the 3.9G licences to be fixed by the regulator," AIS Chief Executive Wichian Mektrakarn told reporters. "We are ready for the auction because we have long prepared for this."

AIS, 21.4 percent owned by Singapore Telecommunications Ltd (STEL.SI), had planned to invest about 50 billion baht ($1.5 billion) on a 3G network in the three years after it receives a licence.

However, that may have to be increased now the licences will be for 3.9G services, which require more advanced technology than the 3G standard but will be based on the same 2.1 GHz spectrum.

On June 9, the National Telecommunication Commission (NTC) published draft terms for licences of the 3.9G service and it is expected to hold a public hearing on June 25.

Under the new draft, the NTC plans to issue three licences and raise reserve prices for the auction to 10 billion baht from the previous draft's 5.2 billion baht.

The licensing of 3G is a crucial step to reform the $4.7 billion sector because it should lead to changes in the way companies pay licensing fees to the government, analysts say.

As existing operating contracts expire over the next few years, Thai telecoms operators want to receive 3G licences on the new 2.1 GHz spectrum, which analysts said should help reduce regulatory costs for operators.

Thailand has about 60 million mobile users with a penetration rate of nearly 100 percent, obliging operators to offer new services to boost growth.

At the midsession break, AIS shares were down 1.2 percent at 83.75 baht, while the broader Thai market .SETI was 0.06 percent higher. The stock has risen 12 percent in the past month on optimism surrounding the new licences. ($1=32.38 Baht) (Reporting by Pisit Changplayngam; Writing by Khettiya Jittapong; Editing by Alan Raybould)