The topic of which mobile network is the number one in Vietnam is now blurred “tit for tat” responses by mobile service providers to enlarge market shares in a narrowing space.
On July 20, 2009, Beeline, a world-renowned brand from Russia, launched its service in Vietnam, making the Vietnamese mobile service market harder to survive and develop. For many, there will be winners and losers in this stiff war.
Viettel and MobiFone competing for the first place
Viettel and MobiFone, the two largest mobile phone service providers in Vietnam, continue leading the “tit for tat” policies to attract more users. The war of the two giants keeps heating up in the local media. For the first time, MobiFone and VinaPhone, both administered by VNPT, slashed service charges, topping the place of Viettel as the cheapest service provider. Following a service charge cut by Viettel, MobiFone and VinaPhone immediately followed the step with their charges lower than the military-run Viettel. Particularly, VNPT’s affiliates’ calling charge is VND10 per minute lower than Viettel. Of course, the price war is a grudging policy by the Big Three and users are clearly the beneficiaries. Viettel is reportedly the largest network by users and begins to step into foreign markets. However, MobiFone is surely known for its title of “best quality and customer care network.” In fact, this network is applying many attractive customer care programmes as well as many utilities services.
There are many reasons for the loss of the VinaPhone’s top place to Viettel and the second place to MobiFone. However, VinaPhone began to change to stop its decline. After many years disappearing in the list of quality network providers, VinaPhone, for the first time, led the Big Three in a test for quality by the Ministry of Information and Communications. But, this is not enough for the network to return its top place in the past.
S-Fone, EVN Telecom remain unmoved
After many changes in leaderships, EVN Telecom still had little change. Despite being a latecomer, EVN Telecom lacked innovative policies to make a revolution on the telecom market. When EVN Telecom penetrates the telecom industry, VNPT actually feared the strength of the Electricity Group of Vietnam (EVN). However, EVN Telecom is now out of concern of the Big Three.
Unlike EVN Telecom, S-Fone was hailed for its creativeness in design, services and charge packages. However, these factors are not enough to become a biggie in Vietnam. Unsolved differences between Saigon Postel (SPT) and SK Telecom dropped many obvious opportunities for the CDMA-based network. As a result, S-Fone makes no headway. Many feel regret for the first network to break the monopoly led by VNPT in Vietnam. According to the media, S-Fone’s competition is now weak. The abandonment of CDMA technology by HT Mobile (currently Vietnamobile with GSM technology) and the weakness of EVN Telecom have broken the CDMA-GSM counterpoise on the Vietnamese market. This ruthless fact forced S-Fone to be a lonely fighter in an unequal war.
Vietnamobile under all-sided attacks
Following the technological accident that caused millions of US dollar, Hutchison and Hanoi Telecom had to abandon HT Mobile to make a new life. Hutchison had to invest for the new technology, GSM. One year after the “death” of HT Mobile, in April 2009, Hutchison and Hanoi Telecom gave birth to the second child, called Vietnamobile, amid all-sided attacks by existing players. However, after the change, Vietnamobile has not made much impressive on the Vietnamese mobile service market. Hutchison is a fear by many giant telecom firms in the world but it seemed to be very “lenient” in Vietnam. According to many forecasts, Hutchison had to make a quake in the Vietnamese market following the technology change but it has not happened. Many think Hutchison is hiding its “lethal weapon” before attacking the Big Three. But, until now, Hutchison had to change the leadership of Vietnamobile after a short time. Despite being supported by Hutchison, the war in the Vietnamese telecom market remains a harsh task for Vietnamobile.
Beeline accepts dead-or-alive game
On July 20, 2009, Vietnam’s seventh mobile phone network, Beeline, made a debut. This is a joint venture between Gtel, administered by the Ministry of Public Security, and Russia’s Vimpelcom. Beeline is expected to create a shock on the mobile communication service market. Unlike others’ expectations that this joint venture will cover its service nationwide to avoid the failure suffered by its older comers. However, the coverage is announced to be expanded nationwide by next year. However, only nine months after obtaining the operation licence, Beeline announced to provide the mobile service and cover three major cities of Hanoi, Da Nang and Ho Chi Minh City. According to Beeline, the Vietnamese mobile communication market will reach “saturation point” in 1.5 - 2 years and Beeline needs to grasp this opportunity. With unprecedented service package, one for all, Beeline becomes a major concern of the Big Three. Beeline applies free call from the second minute without limitation to the number of calls and the same call charge of VND1,199 is applied to both intra-network and extra-network dialling. Beeline willingly accepts lower APRU (Average Revenue Per User) than other networks in a dead-or-alive war. This network is harbouring an ambition of becoming a big service provider in Vietnam with 15-20 % of the market share. An expert forecast low service charges may attract customers to the newcomer but it is uncertain of their position in the future.
At present, the Vietnamese mobile communication service market will see a big change in the future because some will win while others will lose. A merger trend is expected to take place in 2011 because some will not stand alone by that time.
Vietnamese
