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Viettel afraid 3G service will send it to poorhouse
Military-run telecom company Viettel is worried that the hefty costs it has committed to developing third-generation mobile phones services will backfire into big losses.
“In the beginning, we were eager for 3G,” said Viettel General Director Hoang Anh Xuan after receiving the company’s 3G license along with three other telecom firms on Thursday. “But after learning about the implementation of the service in foreign countries, we’ve become concerned about it.”
He said if his company was not “careful,” 3G could “become a burden and make us incur losses.”
Viettel is among four mobile phone operators approved by the government in April to develop 3G mobile phone services in Vietnam. The firm is now building network infrastructure to provide the services in April of next year.
VinaPhone, MobiFone and a venture between Hanoi Telecom and Electricity Vietnam (EVN) Telecoms also received licenses for 3G projects.
Viettel has committed to spending VND12.8 trillion (US$748 million), the largest sum among the four firms, building 3G infrastructure over the next three years.
As planned, VinaPhone would be the first mobile phone operator to launch 3G services. The operator said it would offer the services in September this year while MobiFone planned to launch 3G in December.
The venture between Hanoi Telecoms and EVN Telecoms, meanwhile, has yet to announce its launch date.
But the companies have all committed to starting their services within nine months of the official licensing Thursday.
“3G” refers to third-generation mobile networks, which offer highspeed access to the Internet, email and video.
The battle
The mobile phone services competition in Vietnam has reached a boiling point ever since Beeline entered the market last month.
Beeline not only offers cheap rates, it also provides free calls within its own network.
The traditional Big 3 have thus been forced into promotional warfare to attract new customers.
For pre-paid subscribers, VinaPhone is matching the value of any card worth less than VND100,000 ($5.85) in three days, ending today. The company is also filling accounts with 130 percent more than the value of any card worth VND100,000 or more through today.
Viettel is providing users with a complimentary 50 percent of the value of cards worth less than VND100,000 through today while the rate is 130 percent for higher-value cards. The operator is also doubling values inserted into pre-paid SIM cards that have been locked due to infrequent use until August 31.
MobiFone, meanwhile, said customers who buy a VND50,000 card have been receiving VND145,000 in their account since Wednesday and will continue to do so through the end of the month.
Industry insiders say promotion is the only way to compete with newcomer Beeline. The “Beeline” service, with the prefix 0199, is offered by GTEL-Mobile, a joint-venture between Vietnam’s state-owned Global Telecommunications Corp. and OAO VimpelCom, Russia’s second-largest mobile phone company.
Alexey Blyumin, general director of GTEL-Mobile, said mobile phone penetration was now 55 percent in Vietnam and would reach market saturation in around two years, according to a Nhip Cau Dau Tu (Investment Bridge) magazine report this week.
Vietnam has about 50 million mobile-phone users, of which VinaPhone and MobiFone account for 58.2 percent, Viettel 16.8 percent and EVN Telecom 1.5 percent, Dow Jones newswire reported, citing official figures.
S-FONE LOSES BIG INVESTMENT
South Korea’s SK Telecom Co. said it would no longer invest in S-Fone mobile-phone services, Tuoi Tre newspaper said Friday.
Tran Thi Ngoc Binh, chairman of Saigon Postel Corporation – S-Fone’s other investor, said her company would look for another partner to “maintain the operation of the network and ensure customer benefits.”
SK had supplied much of the venture’s technology and expertise.
Launched in Vietnam in 2003, S-Fone now has only six million subscribers.
Hoang Ly
thanhnien
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