Telecom Firms Boosting Investment in Upgrading Network

 Telecom Firms Boosting Investment in Upgrading Network 

Vietnam has five mobile network service providers at present (including Hanoi Telecom), which is forecast to create a strictly competition in the near future in telecommunication sector, especially in charge reduction movement. The telecom enterprises, therefore, is further focusing on investing in network improvement.

Recently, the Ministry of Planning & Investment has granted an investment license to a US$656-million CDMA mobile phone network project under a business cooperation contract between Hanoi Telecoms Company and Hong Kong's Hutchison Telecommunications.

According to Trinh Minh Chau, general director of Hanoi Telecom, two sides will not pour much capital in infrastructure development but borrow from others. The new network, with an initial code of 092, will be put into operation by 2006.

After the mobile network jam and complaints from the subscribers during Tet, telecom enterprises are now concentrating on upgrading their infrastructure as well as developing new services and subscribers.

The giant Vietnam Telecom Service Company (GPC), the operator of Vietnam's No.1 mobile phone network Vinaphone with more than 50 per cent of market shares, has decided to spend US$100 million this year to improve its old switchboards, install four more switchboards and 1,000 base transceiving stations (BTS) in an effort to get rid of network congestion at peak times.

Another giant, MobiFone, operated by VMS Company, also plans to invest US$450 million in upgrading its network. The firm will build 700 new switchboards, two BTS and 27 Base Station Controllers this year.

The new telecom firm, the Vietnam Military Telecoms Service Company (Viettel) with an initial code of 098, also has a large proportion of the new subscribers, about 280,000 at present. The firm plans to install 1,200 additional BTS and sign up to one million subscribers this year.

With the number of subscribers nearly the same as Viettel, S-phone expects to have 400,000-500,000 new subscribers this year. It also plans to pour some US$40 million into expanding its network coverage to 40 provinces and cities from 20 at present.

In addition, S-Phone continues investing in value-added services such as building WAP 2.0 system, providing Internet services including download programs, films and messages via the cell-phones.

According to the Vietnam-US bilateral trade agreement (BTA), the enterprises from the US will be allowed to invest in the telecom sector in Vietnam (including mobile network and satellite services). By that time, Vietnam's telecom market will be very crowded. It will be easy for the two giants GPC and VMS to attract more subscribers because they both have steady infrastructure.

New enterprises, however, will suffer a lot of challenges on the way to raising the number of subscribers and improving their infrastructure. It is suggested that the State should strictly control the enterprises that hold major market shares and work out measures to help new telecom enterprises.

• Nguyen Thoa