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Cellcard's acquisition of Mfone subscribers comes clear as political football came into play in defiance of a court order - The transition of Smart's acquisition of Hello has not gone seamlessly and a lack of clarity of information of what they are selling is missing


Phnom Penh, Cambodia

Tuesday, April 30, 2013


One could say they're going to get away with murder. For subscribers the bloom is off the mobile telecom rose. As Cambodia's telecoms merge or fail the result is the value off customers is declining. Massive losses were incurred for Mfone customers and employees when the company went bankrupt. Customers lost the balance of their services although prior to the closure Mfone customer service reps said balances would be carried forward IN FULL when transferred to Cellcard/Mobitel who mysteriously acquired the Mfone subscriber base despite a court order that they be frozen since they were considered Mfone's most valuable asset. The company's assets were to be sold off to satisfy debts owed to its creditors.

Several weeks later the Cambodia Daily published a report on the front page f their Friday April 5th edition that Cambodian Prime Minister Hun Sen signed off on Mfone's customers deal with Cellcard/Mobitel in authorizing the subscriber base be transferred to Cellcard/Mobitel in another game of political football. Cellcard/Mobitel's parent company is owned by Kith Meng's Royal Group. Meng is a close friend of the prime minister.

The impact of the closure has had a ripple effect as Mfone employees have suffered the greatest loss as they have been trying to receive payment for unpaid wages and a severance package. Their plight is grave as little has been done to satisfy their complaints.

The defensive position is there is no money to pay them as the company went bankrupt. The Mfone rep we talked to who gave us the information that the value of services would be honored going forward said she had two children. A previous employee divulged her salary being $200 a month. She later took a better job paying $275 a month due to her excellent English language speaking and COMPREHENSION skills.

Customers were left with having to make the decision to pay for Cellcard/Mobitel questionable services as the balance of the Mfone accounts were NOT HONORED. The transferred customer's MAIN balance was categorized as a PROMOTIONAL balance enabling Mfone customers to make calls ONLY in the Cellcard/Mobitel network. To make calls outside of their network required a top up with Cellcard/Mobitel. The promotional balance could also be used on the Internet BUT ONLY with a phone and NOT with a customer's computer. To do so a Cellcard/Mobitel modem purchase and registration was required for $30.

Cellcard/Mobitel has a history of overcharging clients as we experienced during our trial period to see how the company did business. Given the conflicting information and the hassle of doing business with them we opted to take our losses and move on to another company with less stress and hopefully better service. Since that time our stress levels have lessened.


As we've noted in the past inflated subscribe numbers are pumped up for a company to prepare for a sale. The buildup is encouraged by numerous promotions that entice new subscribers. Red flags went up during an ICT Telecom meeting when the top guy for Beeline claimed that his company had 4% share of the Cambodian telecom market which sounded strange in a nation with a population of 14 million. His numbers would indicate that 4% would reflect a population of 100 million.

We interviewed several Khmer subscribers and those in the business of selling top up cards. We learned that Khmer cell phone users would purchase more than one card. In some cases SIM cards were free or less then a dollar. They would purchase a promotion and when it expired they would not renew the service but move on to another company offering a promotion. Although there was a lack of retention the companies carried forward and credited the expired customers to their base thus reflecting inflated subscriber numbers. Later a company would be sold to another with the exaggerated subscriber base included in its value.

In July 2012 Hello had a promotion that offered 2 Gigs of Internet use for $2. That resulted in a jammed network and slow speed which at times was so jammed up one could not access the Internet. The subscriber base grew and the quality of service declined. Earlier this year Hello was bought out by Smart. As a result of the takeover the $2 for 2 Gigs was reduced to 1.5 Gig.

At the outset of the merger the Hello (now Smart) customer service reps that we had been dealing with were not sure what services they were selling. There was nothing in writing in the way of a brochure noting their services.

What did occur were numerous text messages from Smart offering new promotions. Although the customer service reps couldn't explain what it meant and noted that we couldn't change plans until we showed them the text then they change the plan. We marched on to find out how this promotion worked and what it offered. The promotion read: You're selected for a special promotion. Top up within 3 days to get 150% BONUS for on-net Call, SMS, MMS & standard Internet. Thank you for using Smart!

The result THUS FAR is the promotion split the $5 payment in two. The $5 was applied to the main balance that was intended to use for phone calls. The $7.50 was applied to Internet use. When the $7.50 Internet use ran out it automatically deducted the Internet use from the main $5 balance. We received only 400 MB from out $7.50 bonus which is a discernible difference from @ Gigs for $2. For the $5 paid with the Hello plan we would have received 5 GIGS of Internet use thus we received less than 1/13th of the Hello value of 5000 MB's.

The other aspect of the Smart promotion was the $5 balance was good for 60 days before expiring while the bonus Internet use balance expired in 30 days. The Hellos promotion expired in 30 days but the balance was carried forward.

After two months of acquiring Hello Smart sent a text message to our phone that they could no longer honor promotions without giving an advance notice. We later topped up with another account and the promotion was honored.

The newly merged customer service reps are poorly informed how the Smart Company works in order to give correct information to its clients. When we brought the promotion offer to their attention we informed them that the message came us via our phone and asked if the message would appear on the Internet Hello/Smart account. The answer was THEY DIDN'T KNOW. We then went to our Internet account and the message wasn't there. Fortunately we made a copy of ALL of the text messages and they proceeded with the transfer.

The end result is clear... the bloom is off the rose for telecom subscribers since the decreasing numbers of companies are declining thus eliminating competitive promotions. The customer now has fewer choices and the surviving companies are emerging to a position of power and the prices are most likely to increase while the quality of service could decrease.

That became evident when text messages from SMART eliminated or changed the promotion a client PAID and signed up for would NOT BE HONORED. The change in business practices was applied WITHOUT PRIOR NOTICE.

Next: SMART's PRAKAS text message that they were eliminating or changing promotions IMMEDIATELY WITHOUT PRIOR NOTICE.


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