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Government’s strategy to boost 5G deployment in Vietnam

5G is one of the government’s top priorities, with the earliest of services set to be commercialised in mid-2020, following trials conducted through 2019.

A press release has quoted a report that said that a supportive government and regulator could boost 5G network deployments while domestic manufacturing of 5G handsets could lower device costs and lend tailwinds to adoption.

Industry experts believe the impact will be greatest in the enterprise segment, particularly in Vietnam’s rapidly growing manufacturing sector, with government initiatives supporting industry uptake.

The government should lend support to the wider 5G ecosystem through the creation of testbeds, or through enterprise, grants to adopt 5G technologies.

The Ministry of Information and Communications (MIC) is already looking at licensing certain frequencies to domestic manufacturers of 5G products and has stated that it will support the development of 5G-capable chips, although further details have not been disclosed.

At the consumer level, early launches are expected in higher-income cities, with operators likely to focus on both mobile and fixed-wireless services.

While fibre-based broadband connections in Vietnam have grown significantly in recent quarters, fixed-wireless 5G will likely still serve as a complement to existing fixed services and support the development and adoption of higher bandwidth services, such as virtual reality (VR) video streaming and cloud gaming applications.

However, there could be a potential delay to 5G launches due to the COVID-19 pandemic, which has forced operators to increase investments into their existing 4G networks and raise bandwidth on existing fixed broadband connections.

State-run Viettel had to double bandwidth for all fibre-to-the-home (FTTH) subscribers and, together with other government-owned operators Vinaphone and Mobifone, introduce bigger mobile data allocations.

While these short-term moves could put investments into 5G networks on the backburner, the Vietnamese government could pressure their operators to focus on 5G deployment, the release said.

Licenses and spectrum are yet to be allocated, although MIC could convert 5G trial licenses, allocated in 2019, into commercial licenses.

Viettel was the first operator to receive 5G trial spectrum, with bandwidth in the 2.6GHz, 3.6GHz, and 26GHz bands awarded to the mobile market leader in January 2019. This was followed by the award of the trial spectrum to Vinaphone and Mobifone in April 2019.

The smallest operator, Vietnamobile, however, has not made any indication whether it has received 5G trial licenses, and appears unlikely to follow the three state-owned operators in commercialising services in the short term.

Viettel announced in late-2019 that is has developed its own in-house equipment, which will be used to launch its network in mid-2020.

Through Resolution 52, introduced in September 2019, the government aims to actively involve itself in the wider adoption of Industry 4.0 technologies to drive the country’s economic growth.

Vingroup had already started manufacturing its own 4G-capable handsets in December 2018. The company is likely looking to target cost-conscious and lower-income consumers who want to take up a 5G SIM, but are unable to afford a 5G smartphone given their relatively higher cost; the company is hoping that the expansion of its production capacity, which is set to reach 125 million units, will help it lower costs.

The wider availability of low-cost 5G devices in Vietnam will support uptake, primarily among cost-conscious consumers. In terms of industrial applications, the country could see strong use of 5G in its manufacturing sector.

The Adoption of 5G-enabled sensors across the production line is a certainty, although this will centre most largely on the use of private networks in the short-run, such as those developed by private players.

Operators have made no indication of their 5G plans for the enterprise and industrial sectors, although they might develop 5G networks in key economic zones and industrial areas.

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