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France Telecom’s mobile phone unit Orange entered the market in November and with special offers and marketing novelties created additional competition for Beeline (nee, ArmenTel) and VivaCell-MTS.

The major initiative introduced by Orange Armenia was to offer customers a $90 Internet Hima USB modem for only one dram (less than a penny), if the customer signed up for a year subscription plan.

VivaCell-MTS countered by giving a free USB modem (worth about $50) to anyone who contracted for a year.

And Beeline began offering up to 100 percent discount on its HiLine  modems (not USB) and free connection if a customer chooses one of their tariff plans – the more expensive the plan, the bigger the discount.

Price plans among the companies are not dramatically different.

Orange Armenia’s monthly USB modem subscription fee is a minimum of 9,000 drams, or about $23 (for at least a year), offering a speed of 7.2 Mbits/sec before downloading 3 Gb, and then 128 Kbits/sec.

VivaCell-MTS’s MTS Connect Unlimited is for 8,800 drams (about $22) a month (a minimum one-year subscription). It offers a speed of 7.2 Mbits/sec for the download of the first gigabyte, 128 Kbits/sec for the second gigabyte during day hours, and a maximum speed of 512 Kbits/sec during night hours.

Commenting on these novelties, ArmenTel (Beeline brand) company CEO Igor Klimko accused his competitors of hiding the real price of services in year-long contracts that end up being more expensive than the straight-forward service Beeline sells for 12,500 drams (about $32) offering unlimited internet and selling the modem for 18,000 drams (about $46).

Some, if not many, who sign up for the Orange or VivaCell-MTS plans only later read the “fine print” and learn that they have to pay full price for the modem if they terminate their agreement before one year.

Many, however, complain about the work of particularly Orange USB modems. 

“I cannot use it, because it doesn’t work at all. For two hours literally I try to get connected, and after that, if I am lucky, I get five minutes of internet, and that is still at a dial-up quality,” says Lusine Margaryan, 24, from Yerevan, who recently signed up for Orange’s Internet Hima USB Modem one-year subscription.

As she is unsatisfied with the quality of the Orange modem, she wishes to return it within a period of 15 days, as she won’t have to pay in that case. “Unless I use 100 MB until then, they will also pay me back my first monthly fee of 9,000 drams,” says Margaryan.

Artak Sukiasyan, 23, an Alaverdi native who live in Yerevan now, is also going to return his USB modem that he bought for 1 dram from Orange about a week ago unless it starts working normally within the next week or so.

“At the Orange office where I bought it I was told that the connection would be put in good order before December 15 and the modem will start work normally. Now I am waiting. There has been not a single day since I bought it that it worked properly,” says Sukiasyan.  

Orange Armenia explains some disruptions in Internet Hima operations by continuing technical work. 

In contrast, VivaCell-MTS technology has not yet elicited any disgruntled responses, nor did the services of the Beeline network. 

Still, VivaCell-MTS has decided to suspend the sale of MTS Connect modems for the period of technical work to avoid possible customer grievances. 

Despite this, interest in the novelties on the market does not seem to abate and the offers still remain popular.