June 23, 2011

Hello price plan raises discussion


MOBILE company Hello has drawn criticism from competitors and customers for its recent prepaid plans, saying low rates are unsustainable and are causing network congestion.

However, its Chief Executive Officer Simon Perkins yesterday stood by the tariff, saying the promotion has proven successful and the firm was improving its network.

Hello has offered a number of prepaid plans with unlimited on-network calling, most recently charging $3 a month. While customers have complained that Hello’s network is now overcrowded, its competitors have questioned the financial viability of the strategy.

“Unlimited voice or data packages on mobile networks are devastating. It’s not sustainable,” Smart Mobile CEO Thomas Hundt said.

The increased usage as a result of these plans tends to drag on network capacity, he said, adding low tariffs likely meant the firm is losing money in an effort to attract customers.

Mobitel General Manager David Spriggs said a level of profitability was required that allows operators to invest in new services and coverage expansion.

Some local mobile phone shops, as well as Hello customers, have described similar problems with the company’s service.

Chhian Heng, a manager at Hakse phone shop on Norodom Boulevard, said calls on Hello’s network has been “very difficult for two months since the promotion began.”

Ung Sivthong, a Hello customer who works at Olympic Thmey Handphone Shop on Norodom Boulevard, claimed it has been increasingly difficult to make calls after 9 pm. He switches to a second phone with a Metfone SIM card when his Hello handset no longer works, he said.

However, Hello’s Simon Perkins said the company has been successful with its plans to charge a flat rate per month. The firm has invested in its network to meet the new demand from the pricing plan, with some upgrades finished on Monday, he said. “Largely those issues have gone away,” he added.

The plan is also providing revenue for the firm. “The interesting thing is we do make money. We have a regular income stream from people who subscribe from those packages,” he said, adding the company’s market share continues to grow.

Perkins also responded to claims by rival firms that Hello has ignored a Ministry of Post and Telecommunications prakas outlining a minimum price per minute for calls, enacted in late 2009. He said Hello appealed to the ministry when a number of companies continued to offer prices below those dictated by the prakas.

Hello eventually offered the MPTC an ultimatum when the ministry failed to enforce the law: either do so, or Hello also would ignore the prakas. “We decided to take the action we did in early 2011, which was to go out there with a pricing plan that was going to give the market a surprise,” he said.

Perkins said he has no plans to stop the firm’s promotions. “Realistically the ball is in MPTC’s court. They know how we feel.”

Minister of Posts and Telecommunications So Khun yesterday declined to comment.

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