Phone Wars Make for Cheap Streetside Calls in the Capital

Sitting at a streetside phone booth Sunday morning near an intersection crowded with taxis, driver Kun Sophea spoke to his wife in Kompong Cham—mostly about the price of bananas and how they should get them to market—for 45 minutes.

“This is the longest I’ve ever spoken on the phone to my wife. It is a lot cheaper than when I called two months ago,” he said, amazed.

Kun Sophea and others like him said this week that they are enjoying longer and more frequent hand phone calls from street booths as a result of a price war among Phnom Penh booth operators and phone service providers.

Kun Sophea said he paid 4,500 riel ($1.15) for the call, compared to 4,000 riel ($1.02) for only eight to 10 minutes in the past.

Several callers said Sunday that using streetside phones is more cost effective than using a personal hand phone service provider.

“I stopped using my own hand phone to call my friends about two months ago when I found out that street phones are cheaper,” said 19-year-old Ly Bophat.

Rates on the street differ, but range from 100 riel ($0.02) to 300 riel ($0.07) per minute.

Nay Ny, who runs a phone stall in Daun Penh, estimated that rates have decreased by 50 percent to 80 percent over the past year. Private service providers have lowered their rates, he said, resulting in a decrease in his prices. Mobi­Tel has reduced its rate from 500 riel per minute for a call within its network to half that price in the past two months alone.

Cambodia Shinawatra and Cambodia Samart have both lowered their rates from 400 riel ($0.10) per minute to 100 riel per minute for inter-network calls, Nay Ny said. He said the rate reduction was a result of competition between the three providers.

These rates, service providers say, are not their official rates, but rather promotional rates used to attract more customers.

According to a Samart official, street vendors use Samart’s prepaid system: $99 per month with a nominal extra charge per call for network calls of unlimited duration.

“The calling rate is not the company’s rate,” said Shinawatra Marketing Manager Euengfa Amponstrira.

Kith Meng, chairman of the Royal Group, the parent company of MobiTel, said that the low rates on the street are at the discretion of the vendor, but warned that lower rates also mean a dip in service. He said that street phone vendors are more apt to use old or cheap equipment to cut costs.

Another MobiTel official said that the fixed rate system is only cost effective if a booth operator has enough customers.

Nay Ny also said that an increase in street phone stalls also accounts for the price reductions.

“When I saw the phone service next to me was charging 300 riel, I started charging 300 riel, when they went as low as 100 riel, I went down to 100 riel too.”

Even as booth operators battle to lower costs, some are finding that the new rates are not always beneficial.

“The profit from my service is lower than it was two months ago. Before I made at least $5 a day, now I make $2 to $3 per day,” said Long Heng, a booth operator.

“I’m not going to reduce the rate,” he said. He continues to charge 500 riel ($0.13) per minute for MobiTel calls and 400 riel for Shinawatra and Samart calls. “If I lowered the rate I won’t make anything from this business. I pay $65 a month to Shinawatra plus $.01 for network calls or $.10 for cross-network calls. I can not make money.”

 

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