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Telecoms market needs boost

Released at: 14:00, 15/12/2016

Telecoms market needs boost

Photo: Duc Anh

Revenue is slowing in the market but analysts suggest new drivers like 4G will encourage growth.

by Linh San

The overall growth of Vietnam’s telecom market will start to decline following a period of rapid development, according to “The Emerging Asia-Pacific telecoms market: trends and forecasts 2016-2021” released by The Report Linker, a technology company that simplifies how analysts and decision makers get industry data for their business.

Their information comes from more than 10,000 trusted sources such as government agencies, international organizations, consultancies and industry associations.

Vietnam’s mobile penetration, according to the report, is already high and only mild growth is forecast, unless new drivers such as a 4G launch emerge. In addition, the country’s fixed broadband market will continue to experience healthy growth in the future.

The report also stated that competition is strong in the telecom market in emerging Asia-Pacific (EMAP) due to the presence of three or more operators in each key market (except the Philippines), and pressure on pricing has restricted growth in this region.

Revenue for core services (voice and messaging) will decline, but growth in mobile data, IoT, fixed broadband and IPTV services will compensate for this, generating positive overall growth during 2015-2021.

Mobile revenue growth is slowing in emerging Asia–Pacific, and migrating mobile subscribers from prepaid to postpaid subscriptions is one way operators can mitigate this. “Operators in emerging Asia–Pacific could increase their postpaid mobile subscriber bases by offering fixed broadband access,” said Mr. Stephen Wilson, Principal Analyst at Analysys Mason, a global specialist adviser in TMT (telecoms, media and technology) for more than 30 years.

However, total telecom retail revenue in emerging Asia–Pacific will grow at a CAGR of 2.3 per cent, increasing from $278 billion in 2015 to $319 billion in 2021, according to analysts from Analysys Mason.

Recently, Reportbuyer report also stated that Vietnam’s mobile market had reached 147 per cent penetration coming into 2016. The fixed-line market continues to be in decline, having dropped by 70 per cent from its 2009 peak.

In late October, the Ministry of Information and Communications licensed four telecommunication carriers, including Viettel, VinaPhone, MobiFone and Gmobile, to establish the network and provide 4G LTE-Advanced public land mobile telecommunication services. 

Vietnam’s telecommunication market has become saturated with the number of mobile subscribers exceeding the population, according to local industry insiders. Meanwhile, the three largest operators are accounting for about 95 per cent of market shares. Given that fact, 4G will be an opportunity for both large and small-sized mobile network carriers to change the current market share balance.

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