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How Vietnam’s Telecom Industry Grew in 2019

Telecom Industry Growth in Vietnam in 2019
Image credit: Ministry of Information and Communications

The Ministry of Information and Communications (MIC) published a press release that highlighted IT-related telecom industry growth in Vietnam in 2019. The preparation for 5G infrastructure, the mobile number portability policy, and the removal of ‘trash’ sim-cards were the most noteworthy events.

The Telecommunications Boom

The telecom industry witnessed strong growth, although traditional services became saturated. According to MIC, the revenue of the telecom sector in 2019 was VN 470 trillion (about US $20.2 billion), an increase of 19% compared with 2018.

The expansion of the telecom and information technology sectors helped upgrade Vietnam’s positions in international rankings (it had a 10-grade promotion in the global competitiveness index – GCI).

However, there are still a few challenges: the legal framework has not been completed, and some regulations are out-of-date and cannot keep up with the development of the sector.

The revenue of mobile services still relies on traditional services, especially calls and SMS messages (76.6% of revenue). Besides, the competition in the market has led to ‘trash’ sim-cards, spam messages and calls, and cheating.

The Mobile Portability Number

MNP, which was launched in 2018, allows mobile phone subscribers to retain their phone numbers when shifting to services of other mobile network carriers.

MNP has been applied to all subscribers, both pre-paid and post-paid, of Viettel, VinaPhone, MobiFone, and Vietnam Mobile.

After one year of deployment, about one million subscribers have changed mobile network carriers successfully, or 82% of subscribers registering the shift.

The Telecommunications Agency believes that MNP is good for subscribers because it forces mobile network operators to improve their competitiveness. The service providers not only have to compete in service prices but also the in-service quality and customer care.

Addressing Trash Sim-Cards

MIC stated that the heads of telecommunication companies will have to take responsibility for the existence of ‘trash’ sim-cards. Mobile networks that still have these sim-cards won’t get licenses to provide new services.

A report showed that the number of trash sim-cards decreased by 17 million compared with October 2018.

About 6.8 million sim-cards with unclear information are still in circulation, which accounts for less than 5% of total active subscribers. The number of complaints about spam messages has decreased by 90%.

5G Infrastructure in Vietnam

Vietnam is taking steps towards the commercialisation of 5G, slated for 2020. MIC has granted licenses to Viettel, VinaPhone, and MobiFone to pilot 5G technology in major urban centres like Hanoi and Ho Chi Minh City.

The trial of 5G has shown positive results. The real 5G capacity is equal to 80-90% of the theoretical speed with both mmWave and C-Band frequency bands.

Some Vietnamese companies are planning to produce chips used for the core 5G network, IoT devices, and to develop 5G phones and devices.

Also, in 2019, Vietnam signed Resolution 52-NQ/TW, which outlined the guidelines and policies to actively participate in the Fourth Industrial Revolution (FIR).

The strategy set a target to have affordable nationwide 5G network coverage by 2030.

5G is expected to create a new economy, helping the country create a series of new products for smart cities.

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