Price Race Toughens Market for Local Telecom Firms

The competition between the domestic mobile telecom service companies is getting tighter as they adopt a pricing strategy to strengthen their positions. 

MobiFone offers many promotion in pricing to attract new customers
GSM takes the lead

The trio of GSM providers – MobiFone, Viettel and VinaPhone has been much more successful in their pricing strategy than CDMA providers. However, they are always competing against each other.
 
Right after Viettel announced they would discount international outgoing calls for their users, the Viet Nam Posts and Telecommunications Group (VNPT) promptly offered a 50% discount on all calls from their landline network from August 1 onwards.
 
Recently, VNPT allowed its subsidiaries, MobiFone and VinaPhone, to offer call packages with charges up to 90 percent off. One month later, VNPT again presented special offers from these two: call to other networks for no extra charge.
 
Despite the support that its two competitors were getting from the leading domestic telecom firm, VNPT, Viettel Telecom countered it with various special offers in General Packet Radio Services.
 
It announced that both current and new customers will get credits for outgoing calls and get discounts when they settle their bills in advance.
 
CDMA providers finish last
Two domestic CDMA network providers, EVN Telecom and S-Fone, have not been able to compete with the GSM trio, and have had to settle for a total of 6 million users, ten times less than the total of the three GSM companies.
 
HT Mobile, a former CDMA provider, had to close down, unable to compete.
 
S-Fone, surviving on the strength of a long-term promoting pricing strategy, has not been able to keep it up and has announced increased rates for their call package Forever Couple. EVN Telecom has not attracted as many customers as expected with their latest offering - E-Phone.
 
Telecoms experts say that there are only three qualified contestants in the competition to get a license for providing 3G networks - MobiFone, VinaPhone and Viettel. However, they have cautioned the firms not to overuse the pricing strategy as it could upset the balance in the market, and hurt all companies in the long run.

VinaPhone has officially released its newest call package entitled Vina365. Users will receive many benefits including no intra and inter operator charges, 365 days validity once activated, economical airtime: VND119.9 per first 6 second bloc, VND19.9 per second from the 7th to 10th second and VND1,999 per minute from the 11th second onwards, and a low rate of VND599.5 per minute for off-peak calls.

Ho Duc Thang, Vice Director of VinaFone, says that the latest package targets low-income customers, especially employees in rural areas. VinaFone expects the new package to make it affordable for rural customers to use mobile phone services.

Source: Lao Dong Newspaper – Translated by Truong Son

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