Post on 01-Apr-2015
The impact of the recent 3G license attribution on Vietnamese mobile market
Ngoc-Anh Vu ngoc-anh.vu@polytechnique.org +33 6 78 61 83 44
Telecom ParisTech
09 May 2009
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Vietnamese mobile market before 3G license attribution
Winners & engagement
Potential services
Impacts on holders & non-holders of 3G licenses
Wild-card
Agenda
Seven MNO and one MVNO are currently present in Vietnamese mobile market
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1993
1996
Jul. 2003
Oct. 2004
June 2006
Jan 2007
Nov. 2007
April 2009
BCC between VNPT and Swedish Comvik
BCC between Saigon Postel Group and Korean SK Telecom
Mobile branch of VNPT Mobile branch of Viettel Telecom, an economic
entity of Ministry of Defense
Mobile branch of Electricity of Vietnam
BCC between Ministry of Public Security and Russian
Vimpelcom
MVNO of Vietnam Media
Corporation
MNO: Mobile Network Operator
MVNO: Mobile Virtual Network Operator
BCC: Business Corporation Contract
VNPT: incumbent Vietnam Post & Telecommunication Corporation
BCC between Hanoi Telecom and Hongkongese Hutchison Telecom
Local market is relatively concentrated: 3 leading actors have more than 93% market share (in volume)
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Market share (in volume) in June 2008 (latest availably consistent information)
• Three clear leaders
• Viettel: lower segment with
aggressive pricing plans
• Mobifone: higher segment with focus
on client relationship management
• Vinaphone
- S-phone missed Vietnamese market
dynamics
- EVN did not meet expected results
- HT Mobile decided to end its CDMA
services at early 2008 and changed its
trademark to Vietnamobile
Total: 48 millions subscribers
Penetration rate: 58% (*)
Source(s): MIC(*) Multiple SIM ownership means penetration rate is far lower
In April 2009, four 3G licenses are attributed to 5 players who have different engagement levels
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Viettel Vinaphone MobifoneEVN Telecom &
Vietnamobile
Investment
Network deployment
Deployed technology
US$ 800M US$ 600M US$ 350M US$ 370M
• 9 m: 87% population (5000 Nodes B)
• 1 yr: 9000 Nodes B
• 3 yr: 100% population
• Q3’09: 20% population
• 3 yr: 50% population
• 6 yr: 75% population
• 3 m: 2000 Nodes B
• 1 yr: 100% big suburbs
• 3 yr: 98% population
• 9 m: 50% population (2500 Nodes B)
• 3 yr: 5000 Nodes B
HSPA WCDMA HSPA N/C
First 3 years
Security money
US$ 280M US$ 93M US$ 93M US$ 37M
Service launch9 months after license
allocation (i.e. April 2010)
Q3 ‘093 months after license
allocation (i.e. Oct. 2009)
Q1 ‘10
One of the main drivers of 3G network deployment is to provide multimedia services in order to increase ARPU
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Profit Revenue Cost= -
Subscribers ARPUx
Customer needs formultimedia services
Web2.0 trend
TV/video
Music
M-CommerceNomadic usage
Web-browsing
ARPU: Average Revenue Per User
Mobile TV could be a successful service thanks to premium content and suitable data plans
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• Field experience elsewhere (before flat data plans)
• Nokia-TeliaSonera in Finland : 20’ per day
• Orange France : 40’ per month, 54% at home
• SFR (France) : 20’ per day, 50% at home
• Opportunities
• Premium content (sports) is the main driver for Mobile TV
• Alternative TV screen is preferred in certain conditions
• Obstacles
• Flat data packages are necessary to develop services
• Field experience elsewhere
• Obstacles
• Local lifestyle is unfavorable for mobile music usage
• Piracy would be too strong for mobile music to become a real success
TV/video
Music
3 Music Store• 500k tracks• £ 0.99 (€1.48) per track• Dual download (both on
PC hand handset)
M-commerce could become the next killer application in local market
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• Field experience elsewhere
• Opportunities
• Vietnamese population uses micro-payment every single day
• Obstacles
• A strong synchronized deployment between different operators or with financing institutions is essential
• Field experience elsewhere
• Strategic partnership on embedded PC-card
• Opportunities
• Nomadic corporate usage would increase rapidly with the growing awareness of information security
• Obstacles
• 3G PC-card would face a strong competition from wifi networks
M-commerce Nomadic usage
Felica contract (million)
Suitable business models would boost mobile Web and Web2.0 services
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• Opportunities
• Vietnamese young population is eager to
access web everywhere to stay update with
information
• Obstacles
• Almost all popular website are not designed
for mobile access but this is not a serious
issue
• Flat data packages are necessary to develop services
• Example of services elsewhere
• Video blog, post
with MMS
• Facebook in Iphone
• Opportunities
• Vietnamese young population is addicted to
online social networks
• Obstacles
• Suitable business partnership agreements
are essential to develop the services
Web-browsing
Web2.0
3G holders have the opportunity to define the local market evolution
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Market readiness in the next 3 years
Mobile TV
Mobile music
M-commerce Market preemption
Risk on an early & undefined 3G service market
Marketing impact
Normandic usage
InvestmentWeb-browsing
Web 2.0
++--
Pros & cons for the 3G license holders
Market leaders=
Non-holders of 3G license would eventually withdraw from market unless they would receive strong support from regulatory bodies
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Announced movement after 3G license attribution
Segmentation of local market to find market niche
Development of adapted services
Creation of new business models with different partners (ISP, taxi companies, etc.)
Increase its market
capital
M&A with leading actors
Unless they will have a strong protection from a more complete regulation
Gtel S-fone VTC (MVNO)
• Services not yet available
• Partnership with Vinaphone to provide 3G services
N/C Services not yet available
Wild-card
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If 3G services will be used at nomadic usage, what would happen?
Bandwidth
Usage
Mobile
Fixed
Low Bandwidth
Dial up
GSM / GPRS
Broadband
UMTS / HSDPA / CDMA
ADSL
/ FTTx
Wimax / WBS
Wireless ADSL/FTTx
Nomadic
?
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Thank you!