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Telecom market must to be regulated: ETL chief
Telecom companies will face bankruptcy if the government allows them to continue to engage in unregulated marketing competition, according to a top company manager.
“If the telecom companies compete to reduce the price of services then they will not survive,” Enterprise Telecommunication Laos (ETL) Director General Mr. Khammouane Xomsihapanya said in an interview with Vientiane Times on Friday.
Mr. Khammouane made the comment in response to a decision by the Ministry of Post, Telecommunication and Communication to ban all mobile phone service providers in Laos from offering special promotions such as free call credit, sim cards and text messaging in a bid to attract more customers.
The ministry asserts that the marketing competition did not only have a negative impact on the revenue of companies but also on the government.
When asked whether the government policy will limit the capacity of telecom companies to implement marketing strategies, Mr Khammouane said that all companies must compete in accordance with Laos' laws and regulations to ensure the sustainable development of telecom businesses.
He said that all of the telecom investors decided to invest in Laos because they wanted to generate a profit not to provide free services to Lao people. Therefore, it was unrealistic for the telecom companies to provide the free promotions.
“What the government is doing is right. In the past, we played football without a referee. The referee today is strong and is ready to perform its duty,” he said.
Mr. Khammouane said that all of the telecom companies must compete based on the quality of their services, network expansion and variety of services and not by lowering the prices of their services otherwise they will not be able to survive.
Officials at the ministry admitted that some telecom companies continue to provide free promotions despite the warning and said that the authorities would continue to monitor the situation closely.
Ministry Head of Office Mr. Phonexay Phommapanya said that the ministry would impose regulations if the telecom companies fail to comply with the warning.
There are currently four telecom companies operating in Laos – ETL, Lao Telecom, Star Telecom and Vimpel, which recently purchased a majority shareholding in Tigo from Millicom International Cellular.
The increasingly strong competition has benefited customers. At present, there about 5.4 million mobile phone subscribers in Laos, accounting for about 83 percent of the population, and mobile phone networks reach 6,712 villages throughout the country.
vientiane times
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