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The largest telecom operators in Vietnam - Viettel, Vinaphone and Mobifone - are betting on 5G services and digital platforms in order to increase revenues amid saturation of traditional services.
In early May, the Viettel Cyberspace Centre officially put into operation a high-performance computing system that enables both development and operation of more complicated AI models in a shorter time, to meet rising computing demands by the end of the decade – at which point Vietnam aims to become an innovation powerhouse for all of Southeast Asia.
According to Anish Pandey, the regional vertical (ASEAN) leader for enterprise business at NVIDIA – a global leader in AI – such high-performance computing systems will create opportunities for Viettel to cash in on new revenues.
Viettel and other telecom operators have been facing a fall in revenues in mobile services in recent years. Therefore, the move from Viettel could be a solution to regain lost ground amid saturation of the segment and growing demands amid the digital transformation.
In 2020, Viettel and MobiFone saw almost no significant increase in revenues of the mobile voice service segment. Meanwhile, revenues from data services rose strongly. Currently, mobile data charges in Vietnam are among the lowest worldwide, equal to just 30 per cent of that in India. This is a concern as 5G, the fifth generation mobile network, is now available in the country.
Like Viettel and MobiFone, Vietnam Posts and Telecommunication Groups, (VNPT) is also in a similar situation with its mobile services. Nguyen Van Yen, head of the Technology Department of VNPT, said that voice services still account for nearly half of mobile operators’ total revenues.
In the past, VNPT saw a continuous on-year growth in mobile service revenues – however, there was no such increase in 2020.
“This is alarming for VNPT, and other telecom operators are not an exception. This will affect the deployment of new technologies,” Yen admitted.
According to Nguyen Phong Nha, deputy head of the Telecommunications Department under the Ministry of Information and Communications, many mobile operators are facing pressure on revenues from traditional telecommunications services as over-the-top services are replacing traditional voice and text communications.
Nha added that internet services do not create as much profit as expected due to its growing popularity and decreasing charges. “Traditional telecom service providers should enlarge business operation, thus enabling them to have new sources of revenues.”
In the wake of this, Vinaphone, Viettel, and MobiFone are rushing to find new sources of revenue and thus sought licenses for 5G network testing. Last December, Vinaphone – the mobile operator of VNPT – became the first to receive a license for the commercialisation of 5G in Hanoi and Ho Chi Minh City. Since then, Vinaphone has been developing the necessary infrastructure to widen 5G coverage.
The trial run of 5G services in the country is also helping VNPT realise the application of new technologies for smart cities and enterprises.
Elsewhere, together with a high-performance computing system, Viettel plans to deploy 5G on non-standalone architecture and trial 5G on standalone architecture by 2022, together with an array of new services.
In February, over 17,000 Viettel mobile subscribers registered with the company’s 5G promotional package. In the fourth quarter of 2021, 30 major cities and provinces, industrial parks, and urban areas will be covered with 5G. And by 2025, Viettel will deploy 5G on a wider scale towards reaching national coverage by 2026.
Thus far, Viettel has also invested in the development of digital platforms, including the Viettel AI Open platform, Viettel Cyberbot, Viettel Data Mining Platform, and Viettel AI Camera for Transportation, among several others.
Like Viettel and Vinaphone, MobiFone has been preparing for 5G rollouts in many cities and provinces this year. To Manh Cuong, general director of MobiFone, said 5G networks play an important role in digital economy development and forms a foundation for the implementation of Industry 4.0. Therefore, 5G brings about huge opportunities for not only MobiFone but also for its partners and clients.
ICT experts say that the increase in revenues from telecom services is an issue of special concern among management agencies and operators, seeking for solutions to invest in new-generation mobile networks.
According to forecasts from Ericsson and the Global System for Mobile Communications, by 2025, 5G will make up around 20 per cent of the world’s total number of mobile subscriptions.
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