According to the Ministry of Information and Communication (MIC), some small telecom companies have been driven into lamentable positions. However, the ministry has affirmed that it would not rescue the companies and that all members of the market would have to develop with their real capability, instead of relying on the support from management agency.
At a recent meeting gathered by MIC, the officials from Telecommunication Agency said big telecom groups still have been living well, while small ones have been fallen into decay. Especially, a pessimistic forecast has been given that they would be able to live for two or three months more.
S-Fone is one of the names mentioned at the meeting. The lack of investment capital has made it meet with misfortune. Having no money to pay to operate its network and pay for the base transreceiver station leasing fees, S-Fone has to narrow its network.
As a result, its clients have repeatedly complained that the wave coverage area has been narrowed, thus making it unable for them to communicate other subscribers.
A series of S-Fone have left the network, or have been forced to leave the network. A lot of S-Fone’s sales agents have shifted to other types of business, though the signboard is still hung over their shops.
Having few subscribers, not having money to maintain the operation system are the most important reasons which has forced S-Fone to terminate the labor contracts with a lot of workers.
Meanwhile, S-Fone still has not paid salaries and allowances as promised to laborers. In some localities, S-Fone’s workers went on strike, requesting S-Fone to pay money to them.
S-Fone now owes money right and left. The debts include the accounts payable to the State, such as the frequency fee.
Buu Dien Vietnam has quoted senior executives of VNPT and Viettel, the two big mobile network operators, as saying that both S-Fone and its holding group SPT are their big debtors.
SPT’s General Director Hoang Sy Hoa complained at a meeting with the telecom groups which have their own infrastructure systems that SPT’s fixed line network was cut, and SPT then asked to tie the line again to ensure clients’ benefits.
Analysts said that at present, Vietnamese telecom groups have been earning big money from the international telephone services, after the groups unanimously raised the charges on foreign partners. This could be a good way for SPT to make money. However, in fact, SPT cannot join the market, because it cannot connect to the big guys when it still has not paid debts to them.
In such difficult circumstances, it would be very difficult for SPT to persuade its partners and commercial banks to continue lending money to it. Local media has compared S-Fone with the sinking boat with no lifebuoy.
Meanwhile, Gmobile is also meeting big difficulties after it began using a new brand and turned into a 100 percent Vietnamese enterprise. The simcard sales agents in Hanoi said Gmobile’s cards have been selling very slowly. Meanwhile, no breakthrough has been made by the network operator in its new operation period.
EVN Telecom, which was once also in big difficulties, was merged into Viettel. However, analysts don’t think that a similar scenario would occur with S-Fone or Gmobile, because the networks have become no more attractive in the eyes of Vietnamese telecom groups.
Meanwhile, Pham Hong Hai, a senior official of MIC, has affirmed that the ministry would not provide a lifebuoy to the enterprises, saying that everyone has to struggle to live on their foot.