Vietnam’s mobile subscribers to surpass 112 million by the end of 2013
Isabelle Paradis
May 2009
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According to the information released by HOT TELECOM (www.hottelecom.com) in its latest report “Vietnam Telecom country profile”, Vietnam is one of the world’s top 10 countries in terms of information and communications technology (ICT) growth and should remain in that list for the next 5 years.

Until recently, the country’s incumbent operator VNPT enjoyed a monopoly in the fixed and mobile arena. This situation is however rapidly evolving, with 7 fixed operators, 7 licensed mobile operators and 65 ISPs.

Vietnam’s fixed market has undergone a steady growth of 24.5% in the last 5 years. Nevertheless, this trend started to decrease in 2008 and should continue to do so as fixed/mobile substitution accelerates. The number of fixed customers increased by 14.4% in 2008, to reach 13.1 million. The number of fixed lines is therefore expected to grow by an average of 5.2% over the next 5 years to reach 16.9 million and a penetration of 18.2% at the end of 2013.

The mobile market is the country’s most dynamic telecom sector with an average growth of 91.3% in the last 5 years, to reach 69.1 million subscribers and a penetration of 79.7% at the end of 2008. The growth rate of the last 5 years should start decreasing significantly as early as 2009, with a forecasted average growth rate of 10.3% over the next 5 years, bringing the number of mobile connections to 112.1 million at the end of 2013. At that time mobile penetration should have reached 120.8%.

Akin to many other developing countries, Vietnam’s Internet market is greatly underdeveloped. “Low PC penetration (estimated at 14.0%), poor network development, beyond Hanoi and Ho Chi Minh City and high interconnection fees are all factors contributing to this situation” HOT TELECOM’s president Isabelle Paradis said. However, government efforts over the last 5 years, the advent of competition and the introduction of broadband have started to bear fruits. Internet penetration grew from 2.0% in 2004 to 7.7% in 2008 and Internet subscribers increased 5-fold from 1.7 million to 6.7 million.

Broadband services are finally taking off and accounted for 30.6% of all Internet connection at the end of 2008, compared with only 3.2% in 2004. After growing by 220.0% over the last 5 years, broadband customers reached 2.0 million at the end of 2008. Significant growth is expected to continue over the next 5 years with dial-up/broadband substitution increasing steadily.

Broadband subscribers are forecasted to grow at an average rate of 32.7% over the next 5 year to reach 8.4 million by the end of 2013. The number of dial-up customers is therefore expected to start decreasing from 2008 onwards and broadband customers should represent 81.9% of all Internet connections at the end of the forecasted period.

Find out more in HOT TELECOM’s new 29-page global report: http://www.hottelecom.com/vietnam-copr.html