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VimpelCom starts mobile phone service in Vietnam   2009-07-21 - TN, Bloomberg

OAO VimpelCom, Russia’s second-largest mobile phone company, began offering wireless services in Vietnam to expand outside of its slowing market at home.


The “Beeline” service will be offered by GTEL-Mobile, a joint-venture with Vietnam’s state-owned Global Telecommunications Corp., GTEL said in Hanoi Monday. The service will roll out in Hanoi, Ho Chi Minh City and Da Nang, expanding to more than 40 provinces in Vietnam by the end of the year, according to the statement.

The company may face “tough competition” in Vietnam, Vladimir Riabokon, executive vice president of VimpelCom said in an interview in the capital Monday. “All top three operators in Vietnam – Viettel, Vinaphone and MobiFone – are strong and we are taking this competition very seriously.”

Alexey Blyumin, general director of GTEL-Mobile told Thanh Nien he believed that the new service will succeed as VimpelCom has extensive experience in competitive markets.

A deputy general director at Viettel said the recent appearance of two providers, Vietnamobile and GTEL-Mobile, would have a heavy impact on profits of existing networks in the country.

He said there could be a price war, noting that the offer of unlimited calls within the new service providers’ networks would change the current market structure.

A MobiFone senior manager said such unlimited calling plans were “the boldest promotion on the market right now.”

VimpelCom expects a market share of as much as 20 percent in the “long-term,” he said.

The Moscow-based company, which began operations in Cambodia in May, is turning to emerging markets as growth slows in Russia, where the number of mobile phone subscriptions exceeded the nation’s population in 2006. Only 27 percent of Vietnam’s population had wireless service as of the end of 2007, according to the International Telecommunication Union.

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