Tuesday, September 25, 2012

SIM card prices remain high in Burma

Tuesday, 25 September 2012 12:33 Mizzima News

The exorbitant price for a mobile SIM card will not be lowered until March next year, according to Burma’s Ministry of Communications, Posts and Telegraphs (MPT).

A CDMA phone and SIM card recharge coupons. Telephone service in Burma is still out of reach for many average citizens. Photo: Mizzima

A SIM card sells for at least US$ 231 per card.  An equivalent card in neighboring Thailand sells for around $6.

The government has launched a drive to increase mobile phone usage and upgrade telecommunication in the country, but prices still remain too high for average citizens.

Prices for WCDMA SIM cards are around US$ 289.

The telecommunication department has sold about 800,000 GSM SIM cards and 200,000 WCDMA SIM cards, according to an article on the Elevennews website on Tuesday.

The earnings are shared by MPT and companies that have joint-venture agreements with the ministry. They include Yadanabon Teleport, Elite Tech, Asia Mega Link (Asia World’s outlet), Global Telephone Co, Zaw & Zaw Co, Myanmar Padauk Engineering & Construction Co, IGE Co, Aungchantha Trading Co, Tamoehne Chanthatun Waitha Co, Fortune Co, Active Business Consolidation Service Co and Myanma Business Corporation.

Among them, the first three are major partners with the MPT for the project, said Elevennews.

Yadanabon Teleport has been in partnership with the government’s IT sector development while Elite Tech is an affiliate of the influential Htoo Co, it said.

An industry source said, “It was learned that in the last tender, they bought SIM cards for only 250 kyats ($0.29).”

“Continued sales of mobile phones [SIM cards] for 200,000 kyats per piece can actually delay the nation’s economic and social progress. Meanwhile, the MPT and its crony companies are accumulating more wealth,” he said.

Burma’s phone and Internet usage is among the lowest in the world. Less than 10 per cent of the population own mobile phones.

Mizzima reported in August that the state-owned company Vietnam Mobile Telecom Services Company (VMS) said it wanted to bring cell phone prices down to affordable levels for Burmese consumers, and it is preparing to enter the telecom market.

Burma has started a reform process in the telecommunication field that will lead to an upgrade of telephone and Internet services in the country, while driving international investments and lowering prices in the country, officials said earlier this year.

Aimed at expanding its business in the untapped Burmese market, a Vietnamese delegation, headed by Le Ngoc Minh, the vice president of Vietnam Post and Telecommunication Group (VNPT) and VMS chairman, visited Burma. Other international telecommunication companies are also looking to invest in the Burmese market.

Officials said the Vietnamese company wants to help transform the mobile services market from being a luxury that only a few Burmese can afford to an everyday service that all can use on regular basis. Company officials did not discuss the pricing of a mobile phone service in Burma.

“This visit helps us to get a closer view on the cultural and reform similarity between the two nations. Myanmar telecom reform will be, without doubt, an important opportunity and a historic turn point not only for telecom but also for Myanmar socio- economic development,” Le said during his visit.

Minister Thein Tun of the Post and Telecommunication told Parliament earlier this year a bidding process will be held for foreign companies eager to get into Burma’s chronically weak telephone and Internet services.

Burma has very low Internet penetration rate due to both government restrictions on pricing and deliberate lack of facilities and infrastructure, according to observers. Official statistics say the country may have 400,000 Internet users with the vast majority living in the two largest cities, Rangoon and Mandalay.

Although around 50 cities across the country are believed to have access to the Internet, the number of users outside Rangoon and Mandalay is very small. Some estimates say 96 per cent of the country's nearly 60 million population lack telephone or Internet services.

Communication infrastructure is a major obstacle in developing Burma.

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