Telecom operators expand overseas

Vietnamese telecommunication and IT companies have invested or established branches in foreign markets.

IT firms are the new pioneers

FPT Group is has become a pioneer, aggressively trying to take a piece of foreign markets. FPT opened its first foreign software companies in Japan in 2005, then in Singapore, Malaysia, the US, Australia and France after that. Through these firms, FPT has signed lucrative contracts with foreign clients. Most notebly, two contracts worth over $1 million each signed with American firms – Twin City Fan Companies and CourtTrax.

FPT’s general director Nguyen Thanh Nam said that the group invested a lot in its overseas companies. These overseas firms have helped the group acquire large clients.

CMC Group has implemented a similar strategy. It instituted the Thong Nhat Software Company in Japan last May. In December 2009, CMC opened CMC Blue France in France.

Telecom groups follow

Viettel is the biggest Vietnamese investor in foreign telecom markets. The group’s deputy general director Nguyen Manh Hung said that the local market for mobile services is very competitive and it nearly reaches saturated point. In that situation, overseas investment is Viettel’s new strategy.

“A mature company has to set its own challenges and overcome it. Investing in foreign markets is Viettel’s self-made challenge,” Hung said.

Viettel decided to invest heavily in mobile and broadband Internet services.

Last year Viettel launched a mobile network in Cambodia, named MetFone and in Laos, named Unitel. It is negotiating to buy shares of some mobile operators in Haiti and Bangladesh. This group also plans to invest in many Asian, African and Latin American countries.

Hung said in the field of telecommunications, international groups have spread to the world market for 20 years. Viettel is a newcomer so it will only see difficulties but these challenges will force the group to come up with solutions to improve its human resources and management capability. Moreover, there are opportunities in difficulties.

Viettel has gained valuable experience from competing in the Vietnamese market, where the number of users is high but the per capita income is low and competition is fierce, with seven mobile networks. The experience is now paying off in Laos and Cambodia.

Viettel currently ranks the first in Cambodia for network coverage and the second for the number of subscribers. In Laos, it tops for network coverage and ranks the third for the number of clients. Viettel expects to start earning profit from these markets this year.

Viettel has got a licence to open its representative office in Yangon, Myanmar, and signed some contracts with local partners on roaming and international phone services. VNPT Group is promoting a business plan in this market.

Experts watch the two groups compete in Myanmar as an experiment in preparation for a larger world market.

Deputy Minster of Information and Communications Le Nam Thang said that the Vietnamese telecom market is saturated so local businesses have to seek new markets. He hoped that after learning experience from Laos and Cambodia, Vietnamese investors will have suitable moves.

Thang recommended Vietnamese investors to be prudent because the international telecom market is in recession.

Online game companies also seek abroad opportunities

VTC Group in August 2009 established VTC Korea Company in South Korea, a massive market for online gaming. South Korea is also a leading exporter of online games. There are hundreds of online game distributing companies in South Korea, including big ones from the US and Japan.

A VTC representative said entering the Korean market, they can meet foreign partners and learn their experience in producing and distributing online games.

VTC Korea firstly distributes Chinese games in South Korea. Strategizing to combine with local partners to produce online games for both Korean and Vietnamese markets and then export to other countries.

VTC Korea also produces TV programmes for VTC channel in South Korea to serve 80,000 Vietnamese in this country.

This firm said that, in the first day alone, sales of its first game, named Linh Vuong, was 8 times higher in South Korea than in Vietnam.

VTC recently opened its branch in Cambodia and earned $1 million of revenue in the first week. The branch in Laos also obtained revenue on its first day.

VTC is performing formalities to open branches in China, Russia, Indonesia, Japan and some others. Exploring foreign markets is this group’s key strategy, focusing on the growing Southeast Asian market.

Vietnamnet

Tags: FPT, Vietnam Telecom, Viettel