Phone group to close wireless service

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State-owned Vietnam Posts and Telecommunication Group (VNPT) said it will stop providing a limited-range mobile service in Ho Chi Minh City in November due to low profitability.

The technology for the Cityphone service is outdated and no longer suitable for the market, the company said. The service will be terminated on November 15 and its users can switch to other wireless services provided by VNPT, an official said.

Cityphone, as its name suggests, basically serves customers within a city. Calls cannot be made from outside the limited range or when users travel at a speed higher than 40 kilometers per hour.

The service was launched in Hanoi on 2002 and then in Ho Chi Minh City a year later.

There was a debate on whether VNPT should start the service at that time. Experts had warned that the Personal Handy-phone System (PHS) technology that Citiphone was built upon would soon become "trash" as it has limited range and roaming abilities.

Bui Quoc Viet, spokesperson for VNPT, said it's likely that the company will end the service in Hanoi too. There are only 30,000 Cityphone users in both cities, he said.

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