3G telecom tariffs to rise again in Vietnam

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Telecom firms are preparing to hike 3G fees, which the Vietnam Telecommunications Authority says are the lowest in the world now.

Earlier, in April, MobiFone and VinaPhone, the two leading telcos, had hiked the 3G fees by 25 percent to VND50,000 (US$2.37) per month, the same as that of Viettel, the other major player.

But news website Saigon Tiep Thi (Saigon Marketing) quoted Nguyen Son Hai, deputy sales chief of VinaPhone, as saying further tariff hikes are necessary if they are to upgrade and widen their 3G networks to meet the demand of 20 million users and counting. 

According to the VTA, 3G users in the country enjoy the lowest average tariff in the world of VND60,000 ($2.84) a month.

This is only 20 percent of Malaysia's rate, 10 percent of China's, and 3.5 percent of Singapore's.

Telcos, which have invested over VND28 trillion ($1.33 billion) in 3G services, set the fees at 35-62 percent lower than market rates to attract customers since beginning to offer them in 2009.

But the situation is likely to change since the Ministry of Information and Communications has ordered a stop to the practice.

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The fee hikes are set to begin next month, Saigon Tiep Thi  said, quoting an anonymous source.

The telcos said there would be a road map for the hikes to ensure there is no shock for customers.

Industry executives like Mobifone deputy director Nguyen Dinh Chien and Nguyen Anh Dung of Vietnamobile said no telco has so far broken even on their 3G services.

They expect to earn VND7.2 trillion this year from 3G, or a tenth of their total revenues.

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