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S-Fone's license expires

Released at: 14:11, 06/10/2016

S-Fone's license expires

Photo: Duc Anh

Troubled mobile phone services provider inactive for some years.

by Nghi Do

The license of the Saigon Post and Telecommunications Services Corporation (SPT) for the provision of mobile phone services via S-Fone has expired, according to the Department of Telecommunications under Ministry of Information and Communications (MoIC).

The ministry will officially announce the withdrawal of the license in the near future. It has considered withdrawing S-Fone’s 850MHz bandwidth license since 2014 as it has been inactive and no payment has been made for many years.

The bandwidth is the best available and will suit any telecoms operator, some of which have had their eye on the bandwidth since S-Fone ceased providing services.

The actual end of S-Fone has been long in coming, with it having put SPT into debt.

In 2013 SPT asked the Vietnam Post and Telecommunication Group (VNPT) and Viettel to allow it to connect to their infrastructure so it could turn a profit from international call services, but only Viettel agreed.

Experts believe that the best solution for S-Fone now is to declare bankruptcy so that SPT doesn’t go down with it. SPT leaders, though, are still making every effort to deal with S-Fone’s problems, with a restructuring plan sent to management agencies in 2015.

It preferred not to provide any details about the plan when contacted by VET.  

Established in 2003, S-Fone was the third mobile operator in the country after MobiFone and Vinaphone. The S-Telecom Mobile Phone Center, whose network brand name is S-Fone, was launched by SPT along with three foreign partners.

In 2010 SPT and its South Korean partner, SK Telecom, announced a change in their partnership from a business cooperation contract to a joint venture. In 2011 S-Fone changed from the joint venture to S-Telecom Company Limited, with registered capital of $452.3 million.

The company became the first mobile operator to implement the advanced CDMA (Code Division Multiple Access) technology in Vietnam, while other carriers still used GSM (Global System for Mobile Communications).

However, due to the limited models of CDMA handsets, the company was unable to expand its customer base, and had just over a million subscribers after a decade of operations. It then ceased offering any services.

After SK Telecom withdrew from the venture in 2011, S-Fone has been unable to find a new investor to revive the ailing network. In early 2012 it planned to upgrade its network technology from CDMA to HSPA (High Speed Packet Access) so it may increase its subscriber base. It gained approval from MoIC to do so.

In June 2012 it didn’t pay salaries or unemployment insurance to employees and many of its outlets shut up shop. In December 2012 its leaders confirmed that they were unable to repay its debts.

Turnover was VND786 billion ($37.78 million) in 2011. No financial reports have been released for 2012, 2013, 2014, and 2015.

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