3G still to take off fully

Vietnam Multimedia Corporation (VTC) has become the latest 3G licensing business.

Being offered by the telecommunications companies for over last six months, the 3G services have not really been attractive enough to the subscribers with sales accounting for just two to five percent over the total sales generated from subscribers.

When there were only seven telecom networks (not including participations of Beeline and later VTC), many specialists have argued that the market was too crowded, and the authorisation for too many businesses entering telecommunications market is a waste of resources and technical infrastructure. The story became more heated when five of those seven businesses were licensed to offer 3G services. In order to be licensed, each business has to deposit 1.5 trillion dong; it is not a small amount of capital.

On the launching date for 3G services, VinaPhone managing director Lam Hoang Vinh said that in the near future, 2G would still be the main profitable segment of VinaPhone. According to Vinh, it is because 3G is a long-term investment project and it takes seven to eight years to recover the capital. Even a giant like Viettel also confirmed that in 2010, growth of Viettel 3G subscribers would remain very limited compared to the amount of capital invested.

It may due to the above-mentioned thinking, telecom companies have not invested much money in providing as well as advertising 3G services.
Whereas, many applications could be developed on the 3G foundation, such as entertainment contents, business contents, personal activities support contents, distance learning solutions and urban traffic update solutions, said Hoang Ngoc Diep, expert in telecommunications and IT management. That is not to mention the numerous applications at higher level related to e-commerce and e-government, etc.

VTC leaders confirmed to have set targets of one million subscribers and 20 percent value-added 3G services usage within three years. Chu Tien Dat, executive vice president of VTC Digicom added that they would be able to achieve this goal. Dat also said that VTC will not focus heavily on traditional voice and messaging services but also on value added services and mobile contents, thus attracting the customers and avoiding the cases when customers registered to 3G without knowing what specific services are enclosed. VTC plans to provide services related to digital content television, billing services and e-commerce.

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Tags: 3G network, Vietnam Telecom, Vietnam telecom maket