Mobile phone call promotions undercutting the government’s minimum pricing regulations are to be outlawed – again.
Minimum charges will be applied to mobile phone calls from on Thursday with the return of the Telecommunication Regulator of Cambodia’s (TRC) rules on call tariffs, the regulator confirmed yesterday.
On November 28, telecommunications operators were given seven days to take down advertisements that offer promotions in breach of Prakas 232 and apply charges equal to or above official rates.
The TRC declined to detail the new rules. Prakas 232 has a minimum charge of 4.5 cents per minute for calls made within a network and 5.95 cents per minute for calls made between different networks.
Michael Fitzpatrick, chief marketing officer at telecoms operator qb, welcomed the reintroduction of the regulations.
“That the government is doing so now, post-election, is to safeguard the state funds it receives from the revenue share from all operators, which have been severely depleted as a result of the price dumping, by certain operators,” he said.
But Prakas 232 – introduced in 2009 – has not been popular with everyone. In March Beeline – then owned by a VimpelCom subsidiary – and Smart were sent warning letters from authorities stating that their advertisements went “against this Inter-Ministerial Prakas”. The following month the limits were loosened and the government opened up discussions on the controversial rules with Cambodia’s operators.
Until now cheap promotions have continued in the market.
Anthony Galliano, CEO of Cambodian Investment Management cast doubts over the long-term effect the intervention will have on the industry.
“The larger operators can no longer compete on price and must persuade a price sensitive consumer to look beyond the economics and buy on quality, coverage, and brand,” he said.
There were 19 million mobile phone subscribers in 2012 government statistics show. With a population of about 14.6 million, many have more than one. Consumers will lose the most according to Galliano.
“There is no upside for them at all.”