VietNamNet Bridge – After two years of developing 3G services, mobile network operators have admitted that 3G is really a “costly game” and that if they continue injecting money in 4G, they may “fall into the trap” at any time.

According to the Ministry of Information and Communication MIC, to date, 3G has covered nationwide, reaching 93.68 percent of population. However, the total number of 3G subscribers remains low – 8 million – which is really a modest result if comparing with the existing 120 million 2G subscribers. Vietnamese people still stay away from 3G, even though it has been known as the next generation network with outstanding features.

The total sum of money that telcos have committed to invest to develop 3G networks in the first three years of development (2009-2011), is 42 trillion dong, or 2.47 billion dollars.

To date, 33 trillion dong has been poured by four network operators into 3G networks. The money has been used to develop 30,300 base transceiver stations BTS. Meanwhile, the total revenue of the four network operators from 3G services has just reached 3600 billion dong.

The figures, which are far below the expectations, have reminded network operators of the story about the “3G trap” the General Director of Viettel once mentioned. In order to provide 3G services at perfect quality, every mobile network will have to develop the numbers of BTS equal to the numbers of BTS for 2G, or about 28,000 stations.

As such, the sums of money network operators have to pay will be equal to the sums of money for building a new network, about 400-500 million dollars. It costs network operators about 15,000 dollars to build a BTS. Besides, they will also have to spend money on switchboards and sales networks. Only when the coverage can reach throughout the country, will the disconnection or call troubles end.

Tao Duc Thang, Director of Viettel Network Company, network operators would “fall into the trap” if considering 3G a new mobile network. In fact, 3G should be considered just a part of the operation network, like 2G. If so, network operators just have to settle the problems of connecting the two parts.

“It is obvious that 3G is a very expensive game. However, network operators have no other choice than jumping into the field and continuing the investments,” Thang said.

“5000 BTS or 10,000 BTS will not solve the problems. In order to run 3G perfectly, the number of BTS should be several tens of thousands,” Thang added.

A manager of VinaPhone said that the heavy investments so far just still can ensure the quality of services. The number of new 3G subscribers and the number of 2G subscribers shifting to 3G in the last two years were still far below the expectations.

At present, people use 3G just as “current clients”, i.e they may stop using the services at any time, while they are not permanent clients. In fact, the number of permanent 3G subscribers (who use the services regularly and keep the subscriptions for a long time) is just equal to one percent of the 2G subscribers

“2G now remains the main “rice cooker” for network operators. The average revenue per every 2G subscriber in Vietnam is about 100,000-150,000 dong a month,” the manager from VinaPhone said.

Under their development plans, telcos would inject trillions of dong more in the 3G networks. Viettel has committed to invest 12,789 billion dong more in the next three years, while VinaPhona and MobiFone, both belonging to the Vietnam Post and Telecommunication Group (VMPT) 9556 billion dong.

As telcos have been “bogging down” in the 3G race, they keep cautious when talking about the moment for developing 4G technology. “We need thorough consideration. We should not be too hasty,” a manager of a telco said.

Deputy General Director of MobiFone, Nguyen Dang Nguyen, said that 4G should be the issue to be discussed in the period of 2012-2013.

Former Minister of Information and Communication, Le Doan Hop, at the meeting reviewing the 2-year development of 3G network recently also said that the suitable moment for 3G commercial development should not be prior to 2013, while 2015 would be the latest.

C.V