VietNamNet Bridge – The Ministry of Industry and Trade (MOIT) and the Ministry of Information and Communication (MIC) have proposed the government to allow raising the 3G service fees again, just two months after the first increase.

MIC Deputy Minister Le Nam Thang confirmed at a conference held some days ago that MIC and MOIT are seeking the government’s permission on another adjustment of the 3G service fees.

Thang emphasized that the 3G service fees in Vietnam need to be set up based on the production costs, the market demand, and the average price level in the region.

Two months ago, mobile network operators once successfully raised 3G service fees sharply by 40 percent, the move that made the market “choppy.” 3G subscribers then threatened to stop using the service.

Meanwhile, the Competition Department Administration (CAD) took a probe to find out if the three big mobile network operators VinaPhone, MobiFone and Viettel, which hold 93 percent of the market share, violated the Competition Law once they decided to raise the 3G service fee by 40 percent at the same time.

Nevertheless, the service providers finally still could successfully raise the service fees as they wanted amid the users’ anger, because they were backed by MIC, which affirmed that the service fee increase was necessary to ensure the healthy competition in the market.

The argument has once again been made by MIC when it tries to lobby for another 3G service increase. Thang said at the above said conference that the increase of the 3G service fees absolutely complies with the current policies and regulations.

Professor Dr. of Science Nguyen Mai, former Deputy Minister of Planning and Investment, noted that it is unreasonable for MIC to compare the 3G service fee in Vietnam, a poor country, with the fees in other countries in the region and the world, which are richer than Vietnam.

The Vietnamese average income per capita, as announced by the Prime Minister Nguyen Tan Dung, is $1,960 per annum in 2013. Meanwhile, the figures are $40,000 in the US and $45,000 in Singapore.

Mai went on to say that the wage policy should be corresponding to the pricing policy, and that it is unreasonable if state employees, workers receive low salaries and have to pay high for goods and services. In this case, people have to incur the enterprises’ losses.

Mai has also warned that the continued price increases would harm the investors themselves, because a lot of users have decided to stop using 3G services to cut down expenses.

MobiFone is believed to be the network operator which gets biggest benefit from the 3G service increase. A survey by Nielsen has found that MobiFone is the network with the highest number of 3G service users.

The market survey firm’s report showed that 27 percent of MobiFone subscribers use MobiFone’s 3G services, while the figures are 19 percent and 13 percent for VinaPhone and Viettel, respectively.

MobiFone has also been found as the mobile network which has the highest number of subscribers using smart phones.

55 percent of MobiFone subscribers said they were using smart phones. Meanwhile, only 40 percent of VinaPhone and 35 percent of Viettel were using smart phones.

Nguyen Dinh Chien, Deputy General Director of MobiFone, said the 3G service fee needs to be over VND70,000 a month to be high enough for mobile network operators to break even.

Dat Viet