Telecom Critical of Gov’t Internet Phone Plan

The company operating Cam­bo­dia’s privately run international calling gateway claims the government has violated its contract by licensing another company to build a new Internet-based overseas phone service, a letter from the company states.

“The issuing of a new license undermines contracts signed by the Royal Government of Cam­bodia and sends disturbing signals to other investors, either existing or new,” MA Zaman, a vice president at Millicom Inter­national Cellular in the European country of Luxem­bourg, wrote to Prime Minister Hun Sen in late August.

Millicom owns Royal Telecam International and is a partner with the Cambodia-based Royal Group. The two companies operate Tele2, the 007 international phone gateway.

Kith Meng, owner of the Royal Group, said Monday he was unfamiliar with the letter. The Royal Group had also bid to operate the Internet-based system, Kith Meng said last year.

Other Tele2 officials and tele­communications ministry officials were not available Monday afternoon.

The letter may indicate a new hurdle to plans to offer the so-called Voice Operated Internet Protocol, an Internet-based gateway offering cheaper rates than available through either the 007 gateway or the government-run 001 gateway.

A representative from AZ, the Cambodian company which says it has invested $7 million in the protocol, said it was scheduled to be launched later this month.

Sam Rainsy Party lawmaker Son Chhay claimed that Cambodian officials were merely responding to whichever company was willing to provide the largest bribes.

When he was chair of the legislative committee on telecommunications, Son Chhay pressured Minister of Posts and Telecommunications So Khun to admit that he was accepting $2,500 a month as a retainer from Mobitel, which is owned by Royal Group. Son Chhay said So Khun recently told him that he had stopped accepting money from Mobitel several months ago.

“These are Cambodian officials. When they get bribes they allow companies to have a monopoly and a contract. But if they do not get more money, they will violate all agreements.”

When it signed an agreement to create the 007 gateway, the government offered Royal Telecam International an exclusive license to be the sole private gateway operator for 10 years, the Royal Telecam letter states. “RTI based it’s business plan on the clear understanding that there would be 2 licensed gateways,” it said.

Royal Telecam is already suffering losses from illegal international phone gateways and from Internet cafe phone services, the letter stated. Allowing the new service to operate at cheaper prices would be “unfair competition,” the letter states.

Meanwhile, a new survey has officials worried that Cambodians will balk at using the new gateway. In the informal survey of Internet phone users, ministry officials gauged customers’ willingness to pay for a new service that charged a bit more but also provided a better connection than the Internet cafes, said Lam Phou An, an secretary of state at the Ministry of Posts and Telecommunications.

The early results: With the mushrooming of Internet cafes, Cambodians are becoming accustomed to paying such low rates, and are willing to accept the poor quality of the phone connection, he said.

“The new calls cannot be as cheap as the overseas call at the Internet Cafe,” Lam Phou An said. “We are legal, we pay taxes, and the number of Internet cafes offering overseas calls and the number of customers is increasing much faster than before.”

Internet cafes are offering international calls to Europe or the US, and prices are running as little as 200 to 300 riel ($0.06 to $0.08) a minute.

Lam Phou An declined to name the rate set for the new service by the ministry. He said the ministry may choose to lower the rates in response to the survey, which is not yet complete.

Ministry officials have announced two crackdowns on the Internet cafes this year, with little effect.

“It’s very difficult to crack down on us, unless customers reject it,” said Ouy Bunly, owner of Diamond Internet on Monivong Boulevard. “I believe the government cannot shut all the cafes offering overseas calls.”

Even legitimate overseas phone lines can be noisy and troublesome, some said. “I always use the card with my telephone to call overseas, but [sometimes] the voice isn’t clear, and it’s very expensive,” said Eth Kim Than, deputy director of the Guesthouse and Hotel Association in Siem Reap.

 

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