Phone Competition Doesn’t Lower Charges

There is now a choice when making international calls from Cambodia, but consumers should not expect to save money.

Tele2, a new gateway launched by a Mobitel subsidiary, will not immediately lower phone rates, company and Ministry of Posts and Telecommunications officials said.

The Royal Telecam Inter­na­tion­al, owned by Royal Millicom Inter­national Co (Mobitel), be­gan offering the new service Wednesday. People now have two choices to make international calls—prefix 007 of Tele2, or 001 of the ministry’s gateway, which was recently handed over from Australia-based Telstra.

“The formation of Tele2 is a great step for telecommunications in Cambodia, providing world class international telephone access and services,” said Kith Meng, chairman of Royal Group, the partner of the Mobitel company with Luxembourg-based Milli­com International Cellular.

He said Royal Telecam has invested about $15 million to set up two satellites, an international switch system and national microwave links for the new gateway. It offers regular international communication services, including phone, facsimile and video conferencing, officials said. Collect calls and credit calls are not yet available. Tele2 also has a 24-hour help line and an incentive program for frequent users.

But the addition of a second service provider will not affect phone rates. Callers using 007 will pay the same charges as 001 users for the time being.

“Our prices are the same rates as the ministry’s for the mo­ment,” said Ronny Melander, general manager for Mobitel.

Tele2 and the state-owned gateway will set new charges when the phone tariffs are re­vised by the telecommu­ni­ca­tions ministry, according to Mobitel and ministry officials.

Telecommunications Minister So Khun has said new rates will be between 10 percent to 15 percent lower than current rates. The ministry lowered the international phone charges by 30 percent in March, setting charges for calls to neighboring countries at $1.68 per minute, the rest of Asia at $1.82 and the rest of the world at $2.03.

“We have to set our prices within the range,” Kith Meng said. “It wouldn’t be different so much from the government international phone rates.”

Telecommunications insiders welcome the competition.

“Cambodia is one of the most expensive countries in telecommunications,” said Somchai Lertwisetthecrakul, general manager of Samart (prefix 015 and 016). “The competition will benefit the country, leading to price reduction.”

Koy Kim Sea, undersecretary of state for the telecommunications ministry, said the competition will also encourage advertising in the industry and will end up expanding the market.

International telecommunications is lucrative, generating about $23 million for the government last year, almost 90 percent of the ministry’s annual revenue.

Although competition could lead to fewer users of the government gateway, the government won’t lose money because it shares Tele2 gross revenues, Koy Kim Sea said.

According to Tele2 and ministry officials, the ministry is a 25-percent shareholder of Tele2 and will receive 51 percent of the gross revenue. Royal Telecam has a license to operate international phone services for 35 years.

In the telecommunications sector, the ministry has planned to establish a public enterprise, called Cambodia Telecom, with AZ Distribution Co operating the ministry’s international gateway and domestic telecommunication services. But the deal has been on hold for months, officials said.

 

 

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