October 21, 2020

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From 2G to 5G: Vietnam’s decisions that paved the way for digital growth

Vietnam has ambitions of becoming a digital hub for the South-East Asian region and, indeed, globally. Thye have undertaken a plethora of initiatives to achieve this.

With a full-fledged Software Park already in place for many years, Da Nang started the construction of the city’s second Software Park on October 10 this year. Similarly, with a focus on becoming the best place for technology firms, the Ministry of Information and Communications (MIC) said Vietnam will shift from doing outsourcing to making its own products. And the nation has taken steps in the right direction for digital governance, cybersecurity, social assistance, banking and fintech and the entire gamut of public sector services

Apart from the political will and industry buy, the nation’s transformation journey has its roots in decisions made on their mobile networks. During the period 1990 to 1991, the postal and telecommunications sectors prepared for acceleration. Foreign investment increased rapidly and there was an increased demand for mobile communication services, especially in HCM City.

Vietnam had to decide which technology would be suitable for the nation and finally agreed that the nation should migrate straight to digital technology. Some experts suggested choosing global mobile satellite technology. Its advantage was that it could be used everywhere in the world, though the terminals were bigger than those for other technologies.

GSM technology was applied in many European countries, but it was still in the process of completion, so it was had not been commercialised on a large scale. The technology had a lot of advantages and after considering a series of factors, including market size, technology and terminals, it found that GSM would be more convenient for management. So, in 1993, despite many difficulties, Vietnam went with GSM (Global System for Mobile Communication) technology their mobile networks. It was one of a few countries pioneering 2G.

Initially, there were obstacles during the roll-out process – terminal devices were still incomplete and equipment was expensive. None-the-less GSM was eventually successfully commercialised and began developing rapidly all over the globe and prices of network equipment and terminals decreased rapidly.

In July 1993, a device manufacturer was selected to deploy the first mobile network in Hanoi. The technology chosen was based on European and ITU standards. In late 1993 and early 1994, GSM was available in HCM City. In 1994, the GSM network was established and services were officially provided in some large cities.

In early 2005, global telco giants worked together to develop WiMax. The mobile network operators in the US also supported the technology, while Europe followed 4G LTE. Vietnam decided to choose 4G LTE (Long term Evolution) for 4G.

Experts agree that the right choices of 2G GSM and 4G LTE helped Vietnam avoid ‘technological accidents’ which may have cost the nation dearly in terms of resources, effort and time. They point out that when considering technologies, Vietnam not only considered the preeminence of technologies, but also the market penetration capability.

On January 1, 2020, the first video call using the 5G connection line on gNodeB transceiver, researched and produced by Viettel, was successfully implemented. Vietnam had officially deployed 5G network technology. Testing and roll out of 5G continue and Vietnam extended 5G network testing licences in August this year.

Vietnam is actively taking the lead in terms of technology development, as well as developing a roadmap 2G mobile technology elimination beginning in 2022.