“The lawsuit between VinaSun and Grab over the past few years was not simply a conflict between a traditional taxi business and a technological taxi company,” Deputy Minister of Information and Communications Nguyen Thanh Hung said at the Internet Day 2018 conference entitled “Internet and the Digital Economy of Vietnam” on December 5 in Hanoi. “It was a collision between traditional business models and new models based on technology. This is testament to the fact that we are still confused about the legal environment, which can be called the ‘rules of play’, in promoting and developing a digital ecosystem in Vietnam.”

The conference addressed issues relating to what domestic businesses need to do to develop and protect themselves from the wave of integration, as well as the legal framework for the development of digital ecosystems in Vietnam.

Speakers said that Vietnam is promoting a digital shift with the aim of building the ecosystem and the digital economy. The five pillars of this transition include data, connection, human resources, electronic payments, and safety and network security. Enterprises currently have great demand for data collection and processing so the trend towards cloud and the deployment of open source infrastructure to reduce costs is inevitable. In addition to investing in infrastructure development, businesses need to focus on security and privacy protection for customers.

With a population of approximately 95 million people, Vietnam ranks 15th in the world, with an internet use rate of over 60 per cent, Deputy Minister Hung added. It is the 16th country in the world in terms of the number of internet users. One remarkable statistic is that the average internet usage time of Vietnamese people is nearly seven hours per day, proving that Vietnamese people spend considerable time on online activities.

The development of the digital ecosystem serving the Vietnamese people is a long and necessary direction, creating a lot of value for the society and the people, he went on. Vietnamese businesses now have the capacity and desire to own technology, own the domestic market, and even take products to the region if they receive timely support from policies, the market, and users.

He also said that the explosive growth in technology in general and the internet in particular has created new business models. Vietnam has become a destination attracting many foreign technology enterprises to invest in business and transboundary activities. Although management agencies have made efforts to adjust regulations there is a certain lag in policy, as the reality is too fast and policies cannot keep up. This is a common problem not only in Vietnam but also in the world, including in developed countries.

“So how can traditional Vietnamese enterprises survive and compete equally with technology-based service providers?” Mr. Hung asked, answering that there is no way other than developing a fair and equal playing field that all players must adhere to.

Current ecosystems around the world as well as in Vietnam are changing daily and will shift to other forms. There will be factors forcing these types of services to change in order to survive, compete and grow. According to Deputy Minister Hung, there are two main factors in this change: AI and Privacy.

In order to build Vietnam’s digital ecosystem, he affirmed that domestic enterprises still need to play a key role in implementation. Products and services developed by domestic enterprises should meet practical needs, bringing about common benefits to society, and be widely welcomed by the people. Large businesses need to lead the market, creating the foundation for small businesses and innovative entrepreneurs to join and grow together.

“In the time to come, all three sides - governing bodies, associations and enterprises - need to open up, share, exchange and discuss, to complete the mission of serving the country and the Vietnamese people,” he said. “Domestic businesses need to join forces to reach common goals, to think for the common good, which will help us increase our internal capacity.”