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Network operators accept low 3G service fees to stimulate demand

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Though having spent trillions of dong to develop 3G networks, service providers have been resigned to offering low cost 3G service packages in order to stimulate the demand.

Mobile network operators have been joining forces with content service providers such as VNG or Yahoo in launching service packages with very low fees of 5000 dong a month at minimum. However, the enterprises believe that they will not take loss in long term.
Mobile network operators and content providers join hands

In February 2012, MobiFone and VNG joined forces to provide Zing service package to Mobile Internet service subscribers. Users only have to pay 15,000 dong a month for unlimited 3G access capacity to all utilities of to listen or download music (Zingmp3), read news (Zingnews), or join social networks (Zingme).

Zing, while promoting further cooperation with MobiFone in the future, is also conducting negotiations with two network operators VinaPhone and Viettel on launching similar service packages for users. VNG is going to sign a cooperation contract with the second network, while continuing negotiations with the third one.

In early March 2012, MobiFone declared the cooperation with Yahoo!Vietnam to introduce Yahoo!Mail and Chat unlimited capacity services to MobiFone’s subscribers at the surprisingly low cost of 5000 dong a month. The service allows clients to use Yahoo!Mail or Yahoo!Messenger with unlimited capacity by accessing MobiFone website

An executive of MobiFone said that the service fees for Yahoo!Mail & Chat and Zing packages have been defined after considering many factors, including the current Mobile Internet service fee and the demand.

He said that the fees MobiFone has set up are reasonable, and affirmed that the service packages can ensure business benefits for MobiFone.

Phan Anh Tuan, Deputy Director of VTC Online, chief project operator of project, also said that the company is negotiating with big network operators in Vietnam on the launching of similar service packages like MobiFone’s Zing package.

Slashing prices, improving content to stimulate demand

According to Vuong Quang Khai, Deputy Director of VNG, the Mobile Internet strategy comprises of two parts: lowering service fees and improving content. After spending big money to develop the 3G infrastructure, it’s now the right time for mobile network operators to join forces with content providers to launch attractive products.

“With the popularity of smart phones nowadays, there have been more accesses to Internet from mobile devices. Therefore, the cooperation between network operators and Internet service firms is indispensable,” Khai said.

Agreeing with Khai, Tuan said that the cooperation would benefit both the parties. Content providers have more “tools” to provide facilities and attract more users. Meanwhile, the packages would help network operators increase the used capacity.

A question has been raised that how network operators and content providers would share profits, especially when the former has to spend too much money on the infrastructure development.

Khai said that VNG would not have to share its profit with the network operators. Meanwhile, the representative from MobiFone said that when assessing the investment efficiency, one should not only consider separated services and short term business.

Under the commitments, in the first three-year period, MobiFone, VinaPhone, Viettel, the joint name of EVN Telecom and Hanoi Telecom would invest 33 trillion dong to develop 3G networks with 30,000 transceiver stations to be installed.

By the end of July 2011, 30,334 3G stations had been installed nationwide, while 3G had reached out to 54.71 percent of the population and covered 93.68 percent of the territory area.

Source: Buu dien / VNN


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