Competition in Vietnam Intensifying

Despite happiness with market share for 2005, competition in 2006 forecast to be fiercer than last year with two new mobile networks, EVN Telecom and Hanoi Telecom joining the fray. At a press conference in Ha Long City, Quang Ninh Province in late March 2006, Nguyen Huy Phuc, Deputy Head of the Telecommunications Department under the Vietnam Posts and Telecommunications Group (VNPT) announced that VNPT, VinaPhone and MobiFone mobile networks have signed up more than 7.2 million subscribers between them. If they maintain these new subscriber-signing rates, the two networks could reach 10 million subscribers by the year's end.

Despite strong competition from Viettel Mobile, experts believe that based on their potential and decade of experience, the two VNPT networks will hold the market lead. The two networks are planning to increase the number of their base transmission stations (BTS) to around 5,000 in 64 provinces and cities.

Operation of said networks is more favourable after the Ministry of Posts and Telematics recently gave permission for the firm to activate two more network codes, 093 and 094. MobiFone takes the honours as the largest mobile network in Vietnam. It has more than 4.7 million subscribers, and is forecast for 5 million in early April 2006. Le Ngoc Minh, Director of MobiFone, confirmed that the company's top priority now is to sign up more subscribers. This year MobiFone will expand and improve network capability with nine new switchboards. The company is making further investment of more than US$200 million in the project, raising the number of switchboards to 19 and capacity to handle 7.5 million subscribers. MobiFone will also install an additional 1,183 BTSs and offer four new services this year.

Cornering market share is a priority before two new rivals, EVN Telecom and Hanoi Telecom, get in the game. Consolidation is a move across the board for existing mobile information service providers in the early months of 2006. In March 2006, MobiFone organized a major promotional campaign called "Doubling your account" for customers nationwide. Similarly, VinaPhone launched a promotional campaign called "Surprising gift of March from VinaPhone".

Meanwhile, Viettel Mobile has launched a major promotional offensive to attract more subscribers. The "Lucky 6 numbers" program will run from March 2 until May 26, 2006.

According to experts, with all these major promotional programmes launched in the early part of the year, competition between mobile information service providers will become fierce in later months. However, thanks to stricter management measures governing connection and service quality, competition is far healthier than in previous years."

Posted to the site on 20th April 2006