Ministry explains 3G price increase

Monday, Nov 11, 2013 14:45

Telecom providers raise their 3G fee to re-invest in the network infrastructure. Photo

HA NOI (Biz Hub) — The Ministry of Information and Communications held a press conference on Friday to explain its recent proposal to allow an increase in 3G mobile internet fees by telecom companies Viettel, MobiFone and VinaPhone.

Deputy Minister Le Nam Thang said that telecom companies had originally set prices lower than cost to attract users.

They raised the price of their 3G packages on October 16 after receiving approval from the ministry. Since its enforcement, users complained about the increase and the quality of the service.

However, now that the number of subscribers has risen, they claim they need to raise prices for "re-investment".

Reports sent to the Ministry from telecom companies indicate that the planned average cost for 3G service this year was VND184.4 (US$0.008) per one MB, including valued added tax (VAT), while the average price in the domestic market was VND100 ($0.004)..

When being asked about the 3G low quality, Thang said that the ministry understood that customers wanted quality to match the price.

"It is true that the service quality in some areas is low. Companies can not invest to improve the infrastructure without money. Besides, the ministry will issue 3G quality standards this year," he said.

Thang said that the telecom equipment could be only used for two to three years because a new technology generation seemed to appear every few years.

"We carried out 2G network from 1995, implemented 3G from 2009 and the next generation network will appear in the next six or seven years. The ministry is expected to do research and give licences to companies to develop new generations, such as 4G or 5G, after 2015," he said.

Pham Hong Hai, head of the Department of Telecommunications, said that the number of 3G subscribers had increased to 18.9 million.

This had outgrown the capacity to provide a quality service. He said that telecoms had adjusted 3G fee to expand the network and improve the service quality.

"The service fee hike is reasonable and does not make a great impact in the Vietnamese market. The new fee will ensure a competitive business environment," he said. — VNS

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