VietNamNet Bridge – The FTTH (Fiber To The Home) service fees
have been decreasing rapidly over the last five years, since the services were
officially provided in Vietnam.
Internet service providers believe that the charges would continue decreasing
in the time to come.

Charges halved after five years

In Vietnam, FPT Telecom is considered
the “pioneer” in providing FTTH services by applying the technology in a trial
basis in December 2006. At that time, FPT Telecom gave four FTTH service
packages of 4, 8, 16, 20Mbps with the initial installation costs of eight
million dong, while the monthly subscription fees were 3 million, 6 million, 12
million and 15 million dong per subscribers, respectively.

By July 2010, Vietnam had had
seven FTTH service providers who offer the charges ranging between 1.5 million
dong a month and 30 million dong, depending on the access speed. To date,
businesses, not individual clients, remain the main targeted clients of the
service providers.

Of the service packages
reserved for business clients, VDC under the Vietnam Post and Telecommunication
Group (VNPT) is providing FiberVNN package with the access speeds of 30Mbps,
35Mbps, 45Mbps, 100Mbps and the package fees of 2 million, 2.5 million, 5
million and 16 million dong, respectively.

FPT Telecom is also offering
four charge packages with the access speed of between 30 Mbps and 60 Mbps with
the charges of between 2.5 million and 15 million dong.

Meanwhile, Viettel has only
introduced two packages with the speed of 30 Mbps and 50 Mbps and the charges
of 2 million and 6 million dong.

CMC TI is offering six
packages with the lowest fee at 1.5 million dong and the highest at 30 million
dong.

As such, after five years,
the minimum sum of money consumers have to pay to use an FTTH package has
reduced by a half, from 3 million dong to 1.5 million dong.

Besides FTTH packages, some
Internet service providers recently have launched new fiber services, including
FTTB (Fiber To The Building) by CMC TI, or FTTC (Fiber To The Curb) by FPT
Telecom, which have lower prices of between 500,000 and 800,000 dong, targeting
households or small enterprises.

Vu Hoang Lien, Chair of the
Vietnam Internet Association said that the competition among Internet service
providers is the biggest reason that has forced the service fees down. Besides,
the service providers still can make profits even after they cut down charges.

Sharing the same view, Ngo
Quoc Bao, Deputy General Director of FPT Telecom in the north, also said
service providers have to reduce fees in order to compete with rivals and
attract clients. Besides, the fact that FTTH services now have got a big enough
number of users is also the factor which allows service providers to slash
service fees.

Meanwhile, representative
from CMC TI said the application of the new technology, GPON technology has
allowed the company to cut down expenses on the operation and management. Therefore,
CMC TI can offer the reasonable prices, though CMC TI is the new comer on the
market.

Fees will go down further

According to CMC TI and FPT
Telecom in the north, the current service fees are close to the expenses for
operating FTTH. However, the service fees will decrease in some more years,
when the depreciation period finishes and there are more subscribers.

“The service fees will go
down further in the next years and decrease year after year,” the
representative from CMC TI said.

Meanwhile, Lien said that
the FTTH service fees need to be set up with reference to the service fees in
regional countries. In Japan,
the cheapest FTTH service fee is 5000 yen, or 1.25 million dong Vietnam dong,
while the highest fee is 12,000 yen, or 3 million dong. In Singapore, the lowest fee set by
SingTel is 178 Singaporean dollars, or 3 million dong, and the highest 298
dollar, or 5 million dong.

Source: Buu dien