In line with global efforts to integrate information technology and telecom, many Vietnamese enterprises have invested in and provided services beyond their traditional scope of operation.

Viettel operates mainly in the telecom sector, but this conglomerate seems to be pouring substantial capital into information technology (IT) to satiate both internal and external demand.

Viettel’s IT human resources have soared by over 50 times in the past five years to reach some 1,200 in total. Within five years, the group has developed and put into use 27 software projects, including giant ones such as a charge calculation and customer care system worth approximately US$200 million; a finance software; an IT application that integrates investment, inventories and assets; an e-office; and a car management system. Viettel is also among the first enterprises in Vietnam to apply open-sourced software on a wide scale.

Initially, this conglomerate channeled investment into IT to serve internal needs. However, its success in this phase has prompted Viettel to develop IT into a business niche that is expected to account for 5-10% of its total revenue in 2015. The group has offered such external services as e-signature certification and data centers.

“The advent of 3G technology has paved the way for diverse content services. If the group is inflexible and sticks to telecom services alone, its earnings will plunge,” says Nguyen Manh Hung, deputy general director of Viettel.

Embracing IT is thus an appealing option. “Vietnam has some 300,000 enterprises, which account for about 30% of mobile phone service providers’ income. Given increasingly ferocious competition, enterprises tend to focus on their core operations and outsource IT-related tasks,” Hung says. “Viettel has seized this opportunity to meet both internal and external demand.”

FPT embraces mobile phone services

Mobile services have been FPT’s dream while EVN Telecom, which enjoys great infrastructure and is licensed to offer such services, is plagued by dismal efficiency. Therefore, FPT has purchased a stake in EVN Telecom to enter the mobile service market and capitalize on EVN’s 3G license.

Nguyen Thanh Nam, general director of FPT, says that this move is a fifty-fifty gamble, especially since the telecom market abounds in both challenges and opportunities.

An expert says that for all its experience in the telecom sector (ADSL services) and efforts to compete with Viettel and VNPT, FPT’s ability to thrive in mobile service provision remains unclear. “Unlike with ADSL services, FPT cannot control everything, but has to rely partly on EVN Telecom. FPT can flourish if it can improve EVN Telecom’s current business networks and come up with enticing plans,” this expert says.

According to a source, FPT introduced many new plans, including a new business model, in its discussion with EVN Telecom. However, this business strategy did not receive unanimous support since it often takes much time, money and effort to replace one system completely. Therefore, the current business model is likely to stay, although changes in EVN Telecom’s operation are expected. Unlike in the past, base transceiver stations will probably be operated independently of power stations.

In addition to acquiring a stake in EVN Telecom, FPT wants to explore LTE (4G technology) and grab a license.

Misa and data centers

Besides big enterprises such as Viettel and FPT, some smaller firms are also carving out new business paths.

Misa, a corporate accounting solution supplier, has decided to provide its software online in tune with the increasing popularity of cloud computing in the world. Users can use Misa’s software online instead of purchasing and installing it. The security of Misa’s solutions therefore depends on data service providers. This is why the company has poured money into a data center in Hoa Lac Hi-tech Park in Thach That District, Hanoi. This center will cater for both Misa’s software leasing activities and the need of other service providers. It is part of a project titled the “Center for software development and IT-telecom production,” which Misa started implementing in Hoa Lac Hi-tech Park in late 2010. The project has an expected investment of VND290 billion and is slated for operation in late 2014.

Lu Thanh Long, chairman of Misa, says that his company embarks on this project to set up modern, coherent infrastructure for IT-telecom research, development and production. The project is necessary and appropriate given Misa’s growth. Upon completion, it will be a convenient, modern office complex that meets the company’s infrastructure and fuel the rise of high-quality IT-telecom products that quench the market’s thirst.

Source: SGT