Hanoi - Vietnam's Ministry of Public Security has teamed up with a Russian mobile phone operator to set up the communist country's seventh mobile phone network, an official said Wednesday. Russia's second largest mobile phone operator, Vimpelcom, signed an agreement to set up the network with the Global Telecommunications Corporation under the public security ministry on Tuesday in Hanoi, said the official.
The joint venture jumps into the market alongside the Ministry of National Defence, which currently owns the largest mobile network, Viettel, with more than 40 per cent market share.
The Ministry of Public Security's deal will establish a GSM-based mobile phone network named GTel, according to Pham Hong Hai, director of the Telecoms Department at the Ministry of Information and Communications.
"They have conducted thorough research on the potential of mobile phone development in Vietnam and we have licensed them to set up the network," Hai said.
The joint venture has total registered capital of more than 667 million dollars, with the Vietnamese partner contributing 60 per cent and the Russian partner the remaining 40 per cent.
Vimpelcom announced on its web site that it would invest up to 1 billion dollars in the joint venture over the next several years and that it aimed for a market share of between 15 and 20 per cent.
Vietnam, with a population of 86 million, currently has three mobile networks using GSM technology and three using CDMA technology.
Hai said one of the CDMA networks, HT Mobile, has applied for a license to change from CDMA technology to GSM. HT Mobile has suspended its service for the switch.
The country now has more than 48 million mobile phone users, 70-80 per cent of which are prepaid subscribers. Viettel of the Ministry of National Defence has the highest number of subscribers at 19.42 million.
