VietNamNet Bridge – Tough competition plus saturated demand in
the local mobile telecom industry forced many firms to either pull out of
Vietnam or to make offshore investments last year.
Regarding the local mobile
telecom market in 2012, market research company BMI reports that the local
market has lost its attractiveness. The number of subscribers is nearing the
saturation level and the average revenue per user (ARPU) has been falling with
the number of pre-paid users accounting for over 90%, the British firm reports.
Vietnam’s ARPU is at a mere
US$4.11 per subscriber and the figure is expected to drop to US$3.51 in 2015,
BMI says.
Similarly, Tong Viet Trung,
deputy general director of military-run telecom firm Viettel, commented that
2012 was a difficult year for industry insiders in the context of the on-going
economic slowdown. The local telecom market is in fierce competition with the
number of users almost reaching the saturation mark, meaning there is little
room left for the market’s development, he added.
The domestic market last year
witnessed the disbandment of CDMA S-Fone and Viettel’s acquisition of EVN
Telecom.
Russian telecom group VimpelCom
in April 2012 had no other choice but to sell 49% equity on the cheap at a
total value of US$45 million to Vietnam Gtel Mobile JSC to cut losses. At the
same time, the Russian company withdrew its Beeline brand out of Vietnam.
Since Beeline’s withdrawal,
Vietnam Gtel Mobile JSC has still struggled with attracting new users for the
new service Gmobile, and this is ascribable to capital shortages, incomplete
infrastructure and weak competitive capability.
In the meantime, mobile service
provider S-Fone became inactive in 2012 without releasing any official
announcements. Other mobile services suppliers having ties with S-Fone like
Viettel, MobiFone or VinaPhone all affirmed that the firm has stopped connections
with their networks as well as its own operation.
That’s why several licensed
mobile virtual networks find it too risky to join the market at present.
Dong Duong Telecom has lost its
license for deploying mobile virtual network while the Ministry of Information
and Communications is considering taking back the license it granted to VTC if
the firm fails to launch its virtual network this year.
Viettel was considered the most
successful industry player in 2012 with an after-tax profit of VND27.5 trillion.
But the company also experienced troublesome procedures when acquiring EVN
Telecom and handling a loss of nearly VND2 trillion on behalf of its partner
under the deal.
Given the saturated demand at
home, members in the mobile telecom industry are racing to expand their network
overseas. MobiFone in early December last year opened its representative office
in Myanmar’s capital city of Yangon in order to explore and promote its
investment activities in the new market.
Viettel recently invested in Laos,
Cambodia, Dong Timor, Mozambique, Cameroon, Haiti and Peru, and reported
profits. The total number of users in the new foreign markets of Viettel
amounts to roughly 10 million people.
Source: SGT
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Health care and Life Science with expertise in ASEAN 's area. We are currently changing the platform of www.yourvietnamexpert.com, if any request, please, contact directly Dr Christian SIODMAK, business strategist, owner and CEO of SBC at christian.siodmak@gmail.com. Many thanks.
No comments:
Post a Comment