Positive prospects

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VnEconomy English - 19 month(s) ago 7 readings

Internet and mobile phone subscriber numbers seem certain to continue their upward trend in Vietnam.


Only 8.2 per cent of Vietnamese households access the internet at home and only 12.6 per cent used personal computers in 2010, according to a nationwide survey on telephone, internet and audiovisual services conducted by the Ministry of Information and Communications (MIC). “The figures show that internet services have major potential in Vietnam into the future,” said Mr Nguyen Duc Thanh, CEO of CMC Telecom Infrastructure Company (CMC TI).

The highest ratio of home internet access was 33 per cent in Ho Chi Minh City, followed by 22 per cent in Hanoi and 21 per cent in Da Nang. Some cities and provinces only have 2-4 per cent, such as Tuyen Quang, Ha Giang, Thanh Hoa, Ben Tre, Tra Vinh, and Ca Mau. Results were similar regarding households using personal computers.

While the ratio was 30 per cent in Hanoi, Ho Chi Minh City and Da Nang, most cities and provinces had ratios below 20 per cent and only 6 per cent in northern provinces such as Hung Yen, Nam Dinh and Ninh Binh.
The survey results indicate that the number of internet users and subscribers will grow strongly in the years to come, especially, Mr Thanh believes, when transmission infrastructure is more broadly developed and with the number of people using personal computers gradually increasing.

Increases in the number of people accessing the internet via their mobile phone or smart phone are also evidence of the potential for internet use. Business opportunities for the country’s 90 internet service providers, such as VNPT-affiliated VDC, Viettel, and Saigon Postel (SPT), will be significant.

Vietnam’s mobile market has been experiencing double digit growth over recent years due to the marketing efforts of the country’s mobile operators. The market share of the three largest operators - MobiFone, Viettel and Vinaphone - total more than two-thirds, with EVN Telecom, Hanoi Telecom, SPT, GTel, Dong Duong Telecom and VTC accounting for the remainder. With 40-50 million of the country’s population of 80 million not yet having a mobile phone, operators looking to expand their market share can be rightly optimistic.

According to the survey, 37.5 per cent of the population are mobile phone users, coming in at just below 50 per cent in major cities such as Hanoi, Ho Chi Minh City, Hai Phong and Da Nang. Southern Binh Duong province had the highest ratio, with 57 per cent, while the lowest were found in northern Son La, Dien Bien and Ha Giang provinces, with 20 per cent.

The survey also reveals that the expected saturation of mobile subscribers has not occurred. Mr Michael Cluzel, CEO of Gtel-Mobile - the developer of the Beeline brand – told VET that he was unsure if Vietnam’s mobile market was saturated or not because there is always a difference between nominal density and real statistics.

With only a small market share, Beeline’s operational focus will be primarily on expanding and developing its network coverage and quality, improving services and launching commercial operations around the country. It recently launched an impressive promotional campaign to attract more users but some industry insiders doubted the campaign would have a major impact on the market.

Insiders believe that the telecom market performance is decided by a range of factors, including network, services, customer care and brand prestige, not only by the low call charges.
In the midst of 3G infrastructure development, the popularity of smart phones has been rapidly increasing in Vietnam. Six months after 3G services were first introduced in 2009, only 3 per cent of mobile users had signed up. But in the following six months subscription numbers jumped to 11 per cent. It is estimated that the number of 3G users will increase from approximately 8 million in 2011 to 16 million by 2014.

As a young population, Vietnam’s youth are being targeted by mobile operators as well as internet service providers, who need to prepare expansion strategies. There is certain to be more competitive campaigns conducted to attract these young customers.

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