VietNamNet Bridge - The Ministry of Information and Communication (MIC) has told mobile network operators to stop sales promotion campaigns until the end of 2016, in an attempt to stop price wars.

Before the watchdog agency released the decision, mobile network operators competed to offer preferences to post-paid mobile subscribers.

The sales promotion campaigns were launched so regularly that many subscribers said they would not buy scratch cards unless they can enjoy preferences.

In fact, sales promotions began to increase in 2005, when the telecom market entered the booming period. In an effort to lure customers, the biggest players in the market, including MobiFone, VinaPhone and Viettel, together with smaller networks such as S-Fone and HT Mobile, launched promotion campaigns.

At first, a network operator offers the bonus of 50 percent (customers had 150 percent of the amount they paid in accounts). To compete with the operator, other networks offered larger bonuses of 100 percent and 150 percent. 

In an effort to create a healthier market, in July 2010, MIC released a legal document stipulating that the bonus must not be higher than 50 percent of the value of the scratch cards.

The Ministry of Information and Communication (MIC) has told mobile network operators to stop sales promotion campaigns until the end of 2016, in an attempt to stop price wars.

The regulation helped cool the price war, but it could not stop it. Mobile network operators still dodged the laws and offered preferences to lure customers.

Smaller networks, which are less prestigious than big players, had no other choice than to join the race. They had to offer bigger preferences than that offered by big players to lure subscribers. They gave money to new subscribers and sold dirt-cheap cards with billions of dong in accounts.

The long race then made small network operators worn out. Unable to continue the race, in 2013, S-Fone and Beeline left the market.

Not allowed to give big bonuses, mobile network operators are offering the 50 percent bonus, but they launch sales promotion campaigns more regularly. 

They also design preferences to specific groups of customers, such as students. Analysts commented that this is a method the operators used to dodge the laws, because the beneficiaries of the programs were not only students, but also other people.

Therefore, the watchdog agency has to take action to tighten management over the telecom market, stipulating the maximum bonus level and the punishments on violators.

MIC Deputy Minister Phan Tam said he hopes the ‘chronic disease’ of the telecom market will be treated by the new decision.

Mobile subscribers have also lauded the MIC’s decision, though they won’t be able to enjoy big preferences any more. Nguyen Huong in Hoang Mai district said the decision will benefit customers because it will pave the way for new network operators to join the market.

Nam Lich