Vying to supply telecom services for new residential areas

09:09' 15/06/2007 (GMT+7)

To enter new residential areas and high-rise apartment buildings, telecom service providers must pay a one-time fee and monthly commission based on their monthly telecom revenue. VietNamNet Bridge – Fixed phone networks of EVN Telecom, Viettel, and the Vietnam Post and Telecommunications Group (VNPT) are competing with each other to gain market shares of new residential areas and high-rise apartment buildings in Hanoi. Uncompromising struggle Not like in the past when investors often had to beg telecom service providers to build telecom networks in their new residential areas or apartment blocks, this task has become a race among VNPT, Viettel and EVN Telecom now. According to a telecom service development staff who is in charge of negotiating and signing with construction companies, to enter new residential areas and high-rise apartment buildings, telecom networks must pay a one-time fee and monthly commission based on the annual telecom revenue collected from the residential area or the apartment building. In addition, to be able to win contracts with construction investors, telecom service providers must pay certain “black” money. The Hanoi Post Office, a subsidiary of VNPT, still regrets its defeat at the hands of Viettel to provide telecom services at the Trung Hoa-Nhan Chinh new residential area in Hanoi. According to Bui Van Luc, Chief of the Hanoi Post Office’s Business Planning Department, some families in Trung Hoa-Nhan Chinh have asked to continue using the fixed phone service (maintaining their old fixed phone numbers) offered by the Hanoi Post Office. However, the Hanoi Post Office can’t install the telephone lines for those customers because Viettel doesn’t agree. When the Hanoi Post Office asked to share the infrastructure in this residential area, Viettel in turn asked the post office to share the infrastructure at all new apartment blocks and residential areas in Hanoi. Of course, the Hanoi Post Office rejected this request. After that, the Hanoi Post Office installed CityPhone (inner-Hanoi mobile information service) stations around apartment buildings, but this is ineffective. By the end of March 2007, the Hanoi Post Office invested more than VND70 billion (US$4.375 million) in telecom networks at more than 100 high-rise apartment blocks and new residential areas. It currently has 15,000 telecom subscribers. Though accounting for nearly 2% of the total subscribers in Hanoi, the average turnover from each subscriber of this kind is very promising, 1.5 to 2 times higher than the average. That’s why EVN Telecom, Viettel and VNPT consider new residential areas and high-rise apartment buildings “strategic clients”. According to statistics, Viettel is providing telecom services at 27 high-rise apartment buildings, totalling around 20,000 subscribers. This provider has also signed contracts with 26 other new residential areas and high-rise apartment buildings. “Viettel Telecom always consider clients in this area as clients with the most potential, not because of revenue, but because these are new areas which don’t have telecom service providers yet so it is easier,” said Le Huu Hien, Deputy Director for network development of Viettel. EVN has initiated a “stronger” policy by accessing luxurious office buildings in inner Hanoi and its advantage goes along with its “monopoly” of electricity. Normally, when the Electricity of Vietnam (EVN) builds the power facilities for a building, it also develops a telecom cable network at the same time and forces the building investors to use its services. In addition, EVN often “presents” a whole transformer station (worth billions of Vietnam dong) to new residential areas or high-rise apartment buildings. Of course, residents in those areas and buildings must use telecom services supplied by EVN Telecom. This unique measure has forced VNPT and Viettel to sit by and watch in many areas. Viettel uses another approach to access this market. It is willing to share monthly profit with the investors of new residential areas and apartment buildings based on its actual revenues there. In addition, Viettel uses staffs of management boards of new residential areas and apartment buildings as its customer care employees on the spot. How about customer interests? During a promotional campaign offered by VNPT, many customers sought the telecom services of the Hanoi Post Office. However, their needs can’t be met, and those customers all live in new residential areas and new high-rise apartment buildings like Trung Hoa-Nhan Chinh, Nam Trung Yen, My Dinh 1 where Viettel and EVN have installed telecom facilities. Some customers say that they want to use telecom services offered by the Hanoi Post but they can’t since the manager of their apartment buildings said that Viettel or EVN Telecom had installed telecom networks in the buildings already and they must use Viettel or EVN Telecom’s services. Competition is very normal but it shouldn’t affect the interests of customers. Sharing telecom infrastructure facilities to ensure the right of options of customers in offices and apartment buildings and new residential areas is a must. (Source: Buu dien Viet Nam)