Cover Report/ PNG: MOBILE WAR TAKES PNG BY STORM
Customers are all smiles from competition

Baeau Tai & Dionisia Tabureguci
It’s war! So says PNG Telikom in its August newsletter put out on
the eve of a new government and early days of new digital GSM mobile
service provider Digicel PNG in the market.


As if it was almost a sacrilege to mention the name of ‘the competition’,
PNG Telikom’s board of directors told staff plainly that “competition
is here, that the old habits of behaviour must change, and that Telikom
is engaged in a war with an opponent who might play by different rules”.

“Welcome to the real world of competition,” said board director Albert Veratau.

“Realise that we are not the only people now supplying PNG customers with
digital telephone services.

“Our customers have a choice and if we fail to provide good,
reliable, low cost mobile services, expect those customers to leave us.

“And with those customers go your job and mine.
The old days are over, and the old ways must be over too.
Don’t come crying that Digicel is not playing by the rules.

“Expect them to be ruthless business competitors, and believe that you
too must be extra-effective when you compete for customers.
I am not saying that Telikom needs to be unethical, but let’s get
tough on the competition,” the newsletter quoted Veratau as saying.

Indeed Digicel’s trademark aggressive play is now beating down
upon PNG like a super-speed tropical cyclone that observers believe
would reinvent the communication and business landscape in this
million people market.

Subsequent to the launch of Digicel, PNG was gripped by a “mobile frenzy”
where grannies, papas, mammas and even betel-nut sellers braved the long
queue at a nearby mobile booth to buy a new mobile phone.

Both companies immediately launched a marketing warfare through the various
media outlets and suddenly, Papua New Guineans were enjoying cheaper mobiles
and communication costs.

“Buy a Motorola C113 for K99 and get one free—plus a free SIM card and
free calling.

“Swap your B-Mobile SIM Card for a free Digicel SIM card and get K20
credit for free.” These were some of Digicel PNG’s special promotions.

The Telikom PNG camp retaliated and offered its 280,000 nationwide customers
a Nokia 1110i mobile phone and a B-Mobile SIM card for K99, with a startup
kit for K25 and a K10 free call credits.

By mid-August, the Digicel-PNG Telikom rivalry had escalated to an almost
nationwide throb of live local rock band performances, promotional banners
and price slash offerings never before seen or experienced in PNG.

“It was obvious yesterday that new entrant Digicel scored big in Goroka by
selling all its popular branded handsets and SIM cards within the first
two hours after it was launched here,” wrote a local daily newspaper The National.

“Digicel outlets like Bintangor Trading, Papindo Trading and others
were jammed with anxious customers who wanted to get hold of a handset
and get connected to the network.

“Store employees had worked around the clock to order more stocks after initial
stocks were gobbled up by excited customers. One of the Digicel outlets easily
disposed of its handsets worth K60,000 within two hours.

“In Madang town, the noise of the two telcos’ sales campaign drive left the
whole town smiling as they compared which of the two was making the best offer,”
the newspaper reported.

Amid the frenzy, the PNG government has had to resort to questionable moves
to protect its wholly-owned telecom company.

In July, its National Executive Council (NEC) went back on a decision it made
in 2005, which had seen it issue Digicel PNG and another company,
GreenCom, mobile licences.

NEC then directed the Minister for Public Enterprises, Information and Development,
Arthur Somare, to revert to it an implementation plan and schedule
of the implementation of the amended ICT policy.

The amended ICT policy is to see the restructure of Telikom PNG into a NetCo/ServCo
model, therefore will split the company into two entities.

NetCo will own all telecommunication infrastructure in PNG and supply
wholesale services to competing retailers (ServCos).

ServCo will provide services to retail customers through the
infrastructure owned by NetCo.

This decision to amend the ICT policy has not gone down well with the
business community and the general public, and has prompted the Port Moresby
Chamber of Commerce and Industry (POMCCI) to issue a statement, calling on
the government to develop a consistent policy for its telecom industry.

POMCCI president Dave Conn said the policy should be seen as effective
and consistent and should improve communication across the nation at
affordable rates and be highly attractive to foreign investors.

“The government needs to be consistent in its policy to foreign investors
in the telco industry. The proposed revocation of the mobile licences sends
a very poor signal to the investment community,” Conn said.

PNG’s business community supported the calls made by POMCCI and, in a statement,
expressed concern at the restructure of PNG Telikom.

Signed by key executives who represented peak industry bodies in PNG, including
the PNG Chamber of Mines and Petroleum, PNG Business Council, Transparency
International and Manufacturers Council of PNG, the statement highlighted
critical issues they believe must be addressed through vigorous and continued
discussion with the business community, who are well placed to provide
“expert input”.

Some concerns raised were:
• Splitting PNG’s ineffective telecommunications environment
(technology and industry culture) into a NetCo/Servco model has been
challenged in recent expert reviews;
• A NetCo model must be very carefully constructed and constituted to
avoid creating just another form of Telikom that lacks accountability and
commercial independence;
• Access to the spectrum would be restricted to NetCo, as the owner and
operator of all telecommunications infrastructure, and;
• Question of how a NetCo, operating as a recast wholesale monopoly,
better address the telecommunication needs of the country.

The business community had serious reservations on how a NetCo model
might be created in such a short time, particularly amid the
legislative drafting necessary to implement a NetCo/ServCo model,
an impending civil claims and actions from frustrated mobile licensees.

Meanwhile, PNG Telikom has taken to court the matter relating to the
awarding of mobile licences to Digicel and GreenCom and while this is
happening, talks on interconnection between the incumbent and Digicel
are reported to have begun in PNG.

If approved, it will allow Digicel mobiles to talk to B-Mobile phones
and vice versa, which at the moment is not possible.


http://www.islandsbusiness.com/islands_business/

This is great. And to think that PNGns were being ripped off badly by B-Mobile, only a few months ago. Things have greatly improved since Digicel showed up.

Well Digicel is also ripping PNG pipol off they'r bringin in Fones dat are not even worth buying....Dey nau recalling all there fone like the ZTE Flips and Others dat seem to b playing up but through and through they have really brought good price compertition to B moblie.

thats is real true. Had to take my phone in and they told me it was manufacturers fault. I had to get another phone brand.

If the phone was a manufacturing problem, they should of taken the phone and requested a new one from the manufacturer....that is the general rule

out of stock!

I take back what i said about Digicel the real culprits here are "Oceanic Limited" the guys that sell this Phones to Digicel, they should be blamed for the faulty phones that they sell. Digicel is just footing the bill and the bad name of this phones. My good friend the Station Manager for DHL in mt hagen was telling that these people from OCL just dont care about it and say they just import the phones and Digicel has to deal with the fact that its thier phones they bought them even though they are not ther dealers (Digicel)I feel for the the Digicel but like the heading of this goes its a war and they have to be casualties...

Wednesday 10th October , 2007
http://www.postcourier.com.pg/20071010/wehome.htm

THE Somare Government is pro-competition and will not revoke the licences of Papua New Guinea’s two latest mobile phone companies, Public Enterprise Minister Arthur Somare told Parliament yesterday.
“Mr Speaker, the Government will not remove the licences of the new entrants as issued on the 27th of March 2007. The users of the new entrants’ mobile services are assured by the Government that their rights have been preserved and protected and that is consistent with Government policy,” he said in reply to questions on the matter by Opposition Leader Sir Mekere Morauta.
The two mobile phone entrants, Irish-owned Digicel and Green-Com, were issued mobile phone licences early this year with the Irish company snapping up thousands of customers in the first month of the launching its network.
Mindful of Digicel’s expanding network nationwide, Mr Somare said Papua New Guineans were beginning to enjoy the benefits of competition and it was not the Government’s intention to deny them that choice.
“There was no u-turn and there is no u-turn as suggested by the Opposition Leader. Mr Speaker, the people of Papua New Guinea have tasted and embraced competition and that is what this Government – the Somare Government – introduced in its last term in office. And it is not the intention of Government and never has been the intention of Government to deny the people of that choice when competition is introduced.”
While there are concerns the Government’s amended ICT Policy would ensure state-owned telecommunications company Telikom PNG Ltd retained its monopoly, Mr Somare said the policy would ensure PNG consumers received maximum benefit and competition increased efficiency in the telecommunications sector.
“We have tasted competition and that is competition that was introduced by this Government and we like competition. We see its benefits, Mr Speaker. Competition has raised the bar on performance and demands nothing less than greater efficiency by all providers,” he added.
On Sir Mekere’s concerns about the Independent Consumer and Competition Commission (ICCC) being stripped of its licensing powers, Mr Somare said they were only “refining” the ICCC Act to separate the commission’s regulatory and licensing functions.

Thats bound to happen.

In todays paper(11/10/07), it was otherwise...seems like the licence is set to be revoked next year??

The mobile U turn is not the issue, if you think about the grand picture about what is happening, its about the war and battle of public opinion and perception. Who has more public support at the end.

Digicel is doing fine, if digicel volates laws but has the public support, its formidable. Telikom has recently spent millions of Kina for this reason. Technicals laws are ICT policies are been broken and bended, but public opinion right now stands above the rest.

fyi.

Thank you

Somare is very cunning!

Yes he agrees that Digicel will remain since they(GOV, approved them for a operating license. However according to the new ICT policy all mobile towers, satelite services,etc which are the backbone of mobile services will have to be sold to NetCom(Telikom).

In otherwords will keep our end of the bargain and let you operate but you'll have to use our facilities, whether you like it or not.

this would than correspond to increase in mobile rates by digicel and GreenCom

Pang tel PNG's Bikpla mangi blo communication in PNG has just anounced it will be changing mobile digits numbers from 7 to 8 digits which consresponds to digcel n greencoms entrance into the market but will bmobile also change der digits too?..cause if digicel and greencom have the same number of digits they? i think will b able to communicate with each other?.. can some one please shed some light on this.. thanks

This is my own opinion so please do not judge me.

I got a call from my relos back home that Digicell is going to enter customers who got calls from overseas into this K10 000.00 draw. I started calling the numbers since most of them had become digicel customers. I found out minutes later that even for just reaching the voicemail and not leaving a message costs around K1. You can imagine the charge when I decided to talk for a minute or two. What a complete rip off. I tried calling a b-mobile phone and found out it was way cheaper.

You be the judge...

yes, nothing is free, when a company says free, the cost is only hidden.

Does this mean that we can ring a DGcel from land line now cause all the mobile Digits are going to change...and Bmobile n DGcel can comunicate?..Please Someone Explain more on this?...