HindustanTimes.com Wednesday, August 21, 2002
Vietnam's army gears up for telecoms offensive AFP Hanoi, August 21 Vietnam's military will kick off its major offensive on the domestic telecommunications market on September 2, becoming the communist state's fifth Internet service provider (ISP). The army-run Electronic and Telecommunications Co. or Vietel, which was granted a licence to provide online access in 1998, will only serve Hanoi and the southern commercial capital of Ho Chi Minh City, a company spokesman said. It will be in direct competition with rival state-owned ISPs, Vietnam Data and Communication Co., FPT, Saigon Net and Net Nam. The military's move into the online world comes on the back of it receiving the green light earlier this month to enter the fixed line telephone market to complement its march into the lucrative mobile sector. The start up date for Vietel's Internet operations coincides with Vietnam's National Day celebrations commemorating the proclamation of independence from French colonial rule in 1945 by communist party founding father Ho Chi Minh. For an initial period Vietel will offer discounted rates to attract customers but it will then adopt a similar pricing policy to its competitors, charging between 100 and 200 dong a minute (around one US cent), the spokesman said. He refused to reveal the amount of investment or its subscriber targets. A further six other companies have been granted ISP licences but they have yet to start operations. As of June this year there were only 175,000 registered Internet users across the predominantly agricultural country, a 30 percent increase on 2001. However the number of people with online access, mainly via the country's 4,000-plus Internet cafes, is estimated to be as many as 1,000,000 from a population of 79 million. Low telephone ownership is one of the main barriers to Internet access since it was first introduced to Vietnam in 1997 -- last year there were just 5.4 telephones per 100 people, according to the Vietnam Posts and Telecommunications Corp. (VNPT). Personal computer ownership is lower still in the Southeast Asian country, where gross domestic product per capita last year was around 400 dollars. The army, which has its fingers in nearly 200 businesses ranging from transportation to construction and textiles, is also preparing for its entry into the fixed line domestic phone market at the beginning of 2003. For the past two years it has operated a cheap-rate international call service, renting technology from VNPT. However Vietel says recent investment in technology will enable it to go head-to-head with its former state-owned partner in its own backyard. The military's GSM (general system for mobile communications) network is also scheduled to be operational during the first quarter of 2003, but will initially only cover the capital, the central city of Danang and Ho Chi Minh City. Vietel says that by mid-2003, 40 of Vietnam's 61 provinces and cities should be hooked up, breaking VNPT's lucrative stranglehold on the cellular market through its VinaPhone network and from its MobiFone joint venture with Sweden's Comvik. Vietnam has around 1.6 million mobile phone subscribers but the figure is predicted to reach more than seven million by the end of 2005, according to VNPT. The government has targeted telecoms development as one the keys to economic growth and has marked it as high priority. Industry experts say Vietnam is the second most rapidly expanding telecoms market in the world after China. © Hindustan Times Ltd. 2002. Reproduction in any form is prohibited without prior permission To send your feedback via web click here or email [EMAIL PROTECTED]
