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Vietnam: 3G networks hardly benefit mobile operators

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After investing hundreds of millions of dollars in third generation (3G) technology, the growth of subscribers has not met Viettel, MobiFone and VinaPhone’s expectations, reported VietNamNet Bridge.

To get the licence to develop 3G networks, the three firms and EVN Telecom-Vietnamobile deposited 8.1 trillion dong (over $426 million), including 4.5 trillion dong from Viettel alone. After half a year of offering 3G services, mobile operators have not earned much from their 3G network investments.

After 8 months, Viettel has around 7 million 3G subscribers. MobiFone currently has 6 million after five months and Viettel has over 1 million.

A VinaPhone official complained that subscribers don’t use 3G services frequently, so the numbers of subscribers should be reconsidered as frequent visitors. The true subscribers are less than 1 percent in comparison with 2G subscribers.

Viettel, VinaPhone and MobiFone laid high hopes on broadband Internet services via mobile phones and laptops, using mobile networks. However, most users still like surfing the Internet using GPRS technology of 2G networks.

Viettel Deputy Director Nguyen Viet Dung noted that broadband Internet (ADSL) and wireless networks cover all cities. Mobile users can easily surf the net at cafes and on the street using the wireless band from cafes. 3G users, therefore, are not in cities, but in rural areas where ADSL is unavailable.

VinaPhone’s director Lam Hoang Vinh said that 3G service providers need several years to build up their stamps in the market and VinaPhone needs seven years to recover its investment capital in the 3G network. The 2G networks, therefore, are still the major sources of profit for mobile operators. The average revenue from 2G subscribers in Vietnam is around 100,000-150,000 dong/month.

Mobile operators plan to further invest trillions dong into 3G networks. Viettel has committed to an additional 12.789 trillion dong in the next three years, while VinaPhone and MobiFone will invest around 9.556 trillion dong (1$=1,900 dong).


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