AIS One-2-call Price-cutting

[george]

AIS drawn into fresh round of price-cutting

BANGKOK: -- Advanced Info Service (AIS) has announced a new cut-rate promotion for its prepaid subscribers, which could trigger another price war in the mobile phone business, according to rival DTAC. ``We just need to adjust our tariff rates to match those of smaller rivals and boost competitiveness in the market,'' said Titipong Khiewpaisal, vice-president for mass customer marketing for the country's largest mobile operator.

Thana Thienachariya, chief commercial officer of DTAC, said the AIS promotion would ignite another round of price wars.

``The promotion took the industry by surprise, raising questions about whether AIS is now in trouble,'' he said.

The new AIS plan, called ``Talk one hour, pay six baht'', is aimed at its One-2-Call prepaid customers in an attempt to win and keep more new subscribers.

AIS has seen slower growth in new subscribers than its two main competitors, DTAC and TA Orange, which recently resumed price-cut campaigns that drew business away from the market leader.

As well, AIS has also encountered trouble on the political front. Teachers upset with government educational reform proposals have threatened to cancel their AIS service as a protest against Prime Minister Thaksin Shinawatra, who founded AIS parent Shin Corporation. One teacher burned an AIS SIM card earlier this month.

For much of this year, AIS has had almost equal numbers of new subscribers as its smaller rivals. Normally, its net new subscriber totals are far greater than those of other operators.

AIS expects to see 1.1 million net new subscribers this year, a significant decline from its initial target of two million. It expects to have a total of 16 million subscribers by the end of this year.

Second-ranked DTAC also expects 1.1 million new users this year, bringing its total to 8.8 million. Third-ranked TA Orange expects to add 800,000 users bringing its total to 4.2 million.

From January through November, AIS signed up a little more than one million net new subscribers, equal to DTAC's total.

AIS earlier pledged it would no longer compete on price as it would again affect the bottom line and do more harm than good to all operators.

But over the next three months, AIS will offer what it calls a ``matching rate'' _ not a ``price competition'' _ promotion and allow customers who sign up for the new prepaid service to make a one-hour call for six baht.

Customers will be charged five baht for the first minute of a call with no time-of-day limitations. AIS will charge another one baht for the second minute and customers can then go on talking for up to an hour. The package is offered until Dec 31 and is good until June 30.

DTAC charges its prepaid customers, under the existing campaign, five baht for the first minute and one baht for subsequent minutes. TA Orange charges five baht for the first minute and 25 satang for subsequent minutes.

Mr Thana of DTAC admitted that price cuts inevitably resulted in a sharp drop in the bottom line, but DTAC could prove that its average revenue per user was the highest among rivals, thanks to increased call traffic to offset the losses in revenue.

The blended (prepaid and postpaid) average revenue per user (ARPU) for DTAC is 411 baht per month while the figure for AIS is about 394 baht, he said.

``DTAC was gaining at the expense of TA Orange because of better network quality, while it was edging AIS in terms of competitive and fair tariff packages,'' he said.

Mr Thana said DTAC planned to alter rates this week to keep its market share.

--Bangkok Post 2005-12-19

[JustAnotherFarang]

is that meant to read FROM December 31st and is good until June 30th ??

[udon]

Good news!

Capitalism at it's best.

I just wish Aus had the same type of competition instead of a Cartel.

Thank you great leader How's yer tax probs?

[penzman]

Trying to lure back the teachers huh?

[udon]

Trying to lure back the teachers huh?

<{POST_SNAPBACK}>

Well spotted !

[lopburi3]

It did not take long. DTAC now has pay 3 minutes and talk one hour (7.5 baht) and has reintroduced the 5 baht first minute/.25 baht 24 hour plan and prepaid can change to it; along with some other plans.

[taxexile]

is this only for new subscribers until dec.31 or for all existing subscribers.

[lopburi3]

The plan from DTAC I mentioned is for changing your DTAC service but they also have for new subscribers which includes free time of 50 baht per month. The link to change service promotion is below:

http://www.happy.co.th/update/product/sim_...promotion1.html

[profidamus]

The plan from DTAC I mentioned is for changing your DTAC service but they also have for new subscribers which includes free time of 50 baht per month.  The link to change service promotion is below:

http://www.happy.co.th/update/product/sim_...promotion1.html

<{POST_SNAPBACK}>

I think the service is only for new subscribers to AIS, I read it when I first saw it in Bangkok Post and that caught me eye.