Prices look to be headed down soon. In August the government revoked the 1986 law regulating mobile phone charges. And the nation's five main cellphone service providers are gearing up for what promises to be a bloody price battle. The fight for customers promises to be intense.
Business failure is a very real possibility for the losers.
As early as five years ago, Prime Minister Mahathir Mohamad himself declared that the nation was littered with too many cellphone companies. Some mergers could be initiated so that we have three or four companies. Since then, seven or eight cellphone companies have been reduced to five, but most analysts agree that is still too many. Future technological advances like third-generation mobile phones will require huge investments by service providers, and too many competitors merely guarantees failure for everyone. The first salvos of the battle have been fired.