Smaller telecom firms buzzing to set their own prices

The Ministry of Post and Telematics issued guidelines on January 6 relating to the implementation of the prime minister’s decision allowing telecommunications service providers whose market share is under 30 per cent to set their own charges.
Telecom service providers other than Vietnam Post and Telecommunications Corporation (VNPT) include Saigon Post and Telecommunication Corporation, Vietnam Shipping Telecommunication Company or Vishipel, Electric Telecommunication Company or ETC, Viettel, and Hanoi Telecom.
The Ministry of Post and Telematics (MPT) will continue to regulate charges for Voice over Internet Protocol (VOIP) services provided by Viettel and for the shipping and rescue radio services (Inmarsat) provided by Vishipel as their market shares exceed 30 per cent.
New prices are expected to begin later this month as firms are required to inform the ministry of their price structures 10 days before their effective dates.
Nguyen Kim Cuc, deputy general director of Saigon Postel, said the company was reviewing all of its price structures.
“All prices will be lower than current levels and this new price structure will be applied as soon as possible, when the company finishes its calculations,” Cuc said.
Saigon Postel, having less of a market share than the other two oldest service providers Viettel and VNPT, is in the best position under the new document.
Meanwhile, the two giant mobile phone service providers MobiFone and VinaPhone will have their prices controlled by the government. Their Korean rival S-Fone, however, whose number of subscribers now stands at around 26,300, and new player Viettel, are free to set their own.
Do Van Quat, S-Fone Strategy and Support director, said that after 10 working days S-Fone would bring in its new billing system which calculates charges from the first 10 seconds of the first minute, if it is passed by the MPT. Currently the MPT only allows charges to begin from the second minute of a call.
“We have been pursuing MPT approval for our billing system from the first minute. We have already submitted our application to the Ministry of Telematics,” Quat said.
“With the participation of S-Fone, Vietnam is no doubt making its mobile communications market competitive. The market will surely become much more segmented,” Quat said.
Viettel has also decided to start a billing system from the first minute for its mobile phone system, which it will launch mid-year.
As for VOIP, Viettel’s international call service will be affected as it is limited by the government while three other companies offering the same service, ETC and Vishipel and Saigon Postel, are not.
“Viettel will be ‘blocked’ once the service is put under MPT control,” Viettel deputy director Duong Van Tinh said.
The company currently provides around 600,000 minutes of VOIP calls a month from VIetnam to abroad.
However, VOIP prices are not expected to fall much due to the high cost of transmission, links and fees due to VNPT.
“Each enterprise has to pay to VNPT a large part of the total of its turnover from VOIP services, therefore, new prices will not go down too much,” ETC vice director Nguyen Manh Bang said.
Tinh said telecom firms would pay attention to building up their own cable networks for international calls (rather than VOIP calls) in order to pay less of a cut to VNPT.
VNPT’s market share exceeds 30 per cent in nearly all telecom services including local calls, international calls, channel leasing, mobile phones, Internet access and Inmarsat.