New MPT Plan Gets Lukewarm Reception From Mobile Users

By San Yamin Aung 12 January 2015

RANGOON — Myanmar Posts and Telecommunications (MPT), Burma’s largest state-owned telecom provider, launched a new plan on Monday that will offer consumers internet and phone services at different rates.

The plan received a lukewarm reception, however, among customers and retail sellers, who said the price changes were marginal and rates still well above those offered by foreign-owned competitors.

MPT executives announced the company was lowering rates under the new “Swe Thahar plan” during a press conference on Friday. Call rates will be lowered from 50 kyats to 35 kyats (US$0.03) per minute, SMS rates from 25 kyats to 15 kyats per SMS, and users can switch from paying 4 kyats per minute for internet use to paying 15 kyats per megabyte.

Foreign telecoms Telenor and Ooredoo currently offer phone calls for 25 kyats per minute, 15 kyats per SMS and 10 to 6 kyats per Mb for internet usage.

“Our customers have been waiting for us to announce new tariffs. Now, we are very confident about our network and services and therefore, we want to share with you our new offers,” Takashi Nagashima, CEO of MPT-KDDI-Sumitomo Joint Operations, said in a press release.

MPT said its new plan would also result in increasing internet speed, which remains extremely low in Burma compared to other countries in the region.

Last year, Japan’s KDDI Corporation and Sumitomo Corporation announced they would invest $2 billion in a joint venture with MPT over the next 10 years to expand services.

Customers and mobile service retailers on Monday were largely unimpressed with the marginal improvements offered by the new MPT plan, which also drew criticism among Burmese social media users.

“Although there are slightly reduced call and SMS rates, there is no big difference because they changed the internet charges from time-based to data-based under this plan,” said Lwin Mar Htun, a mobile phone user.

“I’m glad that we have a choice not to use that plan,” he said, adding that customers felt like they suffered from the state-owned firm’s reluctance or inability to bring down rates in the past. “I don’t know why they are still doing that. They are still more expensive than others,” Lwin Mar Htun said.

MPT monopolized the Burmese telecom sector during the long years of economic isolation and past military rule; under its control the telecom sector remained underdeveloped and rates extremely expensive.

Nay Phone Latt, executive director of Myanmar ICT for Development Organization, said the new MPT plan “is still more expensive than other operators. But… it is not like with the past. If we don’t like it, we can use other [telecom firms], we have options. We can choose the cheaper and better ones.”

“I will not use that plan. For now, I use MPT for calls and Telenor for internet,” he added.

In January 2014, Norway’s Telenor and Qatar’s Ooredoo were granted two coveted telecom licenses. The firms began rolling out their networks and have put millions of SIM cards on sale since August.

In late December, Reuters reported that Vietnam’s military-owned Viettel would join forces with a second, partially state-owned telecom provider, Yatanaporn Teleport, which holds Burma’s fourth telecom license. Viettel reportedly plans to invest $800 million to compete for a share of Burma’s telecom sector.

The sector is rapidly growing and according to government figures, the number of mobile phone users jumped from 1.6 million in March 2011 to 11.6 million in September this year, with MPT still dominating the market.

Pyi Soe Htun, director of Lu Gyi Min Mobile Phone Shop, which has numerous stores in Rangoon, said most consumers were using MPT to receive phone calls and using Telenor or Ooredoo to make calls and use the internet, a situation that is unlikely to change with the new Swe Thahar plan.

“The plan is not reducing the overall costs. They just introduced a new package plan with a new offer,” she said.

“I think that because they [MPT] hold on to their [market] advantage, they are reluctant to reduce their prices. But if they keep acting like that, their existing customers could also transfer to other [telecoms],” she said, adding that one of MPT’s last remaining advantages was its network coverage in rural areas, where new operators have yet to build networks.

“People are using Telenor and Ooredoo more and more, and also in rural regions locals will buy the new operators when their network coverage expands there,” Pyi Soe Htun said.