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BUSINESS
IN BRIEF 17/3
Market
watchdogs ask for city help to fight smuggling
Market-watch
officers of
During a recent
meeting with city leaders, representatives from the HCM City Market
Management Bureau reported that the city last year discovered 3,495 cases of
smuggled fake goods, an increase of 210 per cent against 2012.
Phan Hoan Kiem,
head of the bureau, said that most counterfeit and illegally imported
products were wine, chemicals, canvas, cigarettes, agricultural materials,
fashion accessories and cosmetics.
The fake goods are
made both domestically and abroad and then smuggled into the country.
Infringement of
intellectual protection rights is occurring more frequently, affecting
licensed companies and consumers, Kiem added.
Dinh Minh Tan, a
market control officer who is responsible for Binh Thanh District, said last
year in the district 141 cases were discovered. The district collected VND5.1
billion from administrative penalties and seized goods valued at VND13
billion ($611,000).
Even though the
city has increased the number of inspections as well as fines, the lack of
resources and personnel has limited successful implementation.
Officials suggested
that the government allocate more funds and personnel, as well as consider
giving inspectors commissions for discovering violators.
However, Nguyen Thi
Hong, deputy chairwoman of
The market bureau
asked the city to impose harsh punishment on makers and traders of fake and
low quality products.
Shinsegae
eyes hypermarket project in city
Shinsegae is
expected to be the second Korean retailer joining
Lee Sang-eun, vice
president taking charge of E-mart segment of the group, arrived in the city
early this week to speed up investment licensing.
“Shinsegae has
entered
However, the
project has just been in the preparatory step. Lee’s visit aims to seek a
suitable location for hypermarket construction and speed up investment
license procedures.
“We expect to win
the license before the end of this year,” Lee said.
A Vietnamese
manager of Shinsegae told the Daily that the project has a total investment
of around US$65 million and Go Vap District is estimated as the venue for the
project.
Shinsegae was
separated from Samsung in the 90s. It now the leading retailer in
It is reported that
Shinsegae has defeated two retail giants Wal-mart and Carrefour on its home
ground. The
Machine
suppliers explore opportunities in Vietnam
The growing
plastic, rubber, food processing and beverage industries are opening up
opportunities for foreign suppliers and manufacturers of equipment and
machinery that are joining an industrial exhibition in HCMC.
There are 470
enterprises from 28 countries and territories displaying their machines and
equipment at the International Processing, Filling and Packaging Exhibition
and Conference (Propak 2014) and the International Plastics and Rubber
Technologies and Materials Exhibition (Plastics & Rubber Vietnam 2014)
opened on Tuesday in HCMC.
Justin Pau, general
manager of Bangkok Exhibition Services as one of the organizers, said
Vera Fritsche,
Markets and Exhibitions Manager, Packaging Machinery, Food Processing
Machinery at the German Engineering Federation (VDMA), said
However, according
to Fritsche, production at Vietnamese firms still depends much on imported
machines, which is the reason why a delegation of 25 German firms is present
at the two exhibitions.
Bruna Santarelli
from the Italian Trade Commission in
According to
Santarelli,
A representative of
the Taiwanese business delegation at the exhibitions said that
Meanwhile, the
Japanese food packaging and machinery company Ishida considers
Hitoshi Fujieda,
general director of Ishida Vietnam Co., Ltd, said the firm has supplied over
300 packaging machines and many other production lines for Vietnamese
enterprises such as Kinh Do, Bibica and Vinamit as well as foreign
enterprises operating in
Vietnam’s food
processing has grown rapidly over the years with an average growth rate of
over 10% a year, said Tran Viet Dung, deputy director of VCCI Exhibitions as
an organizer of the events.
The two exhibitions
under the same roof are taking place at the Saigon Exhibition and Convention
Center in District 7 until Thursday.
Non-tariff
barriers high in trade with EU
Vietnamese
enterprises may find it hard in speeding up exports to the European Union
(EU) when the Vietnam-EU Free Trade Agreement (FTA) ic concluded and begins
effective, as non-tariff barriers are seen challenging.
During the seminar
on impacts of the FTA organized by the
Nguyen Minh Thao
from the Central Institute for Economic Management took furniture for
example, saying that over 90% of Vietnamese wood products will enjoy the
tariff rate of 0% given effects of the FTA. However, if the local woodworking
industry fails to overcome non-tariff requirements, the nation will be not
able to grasp opportunities in the EU market.
At present,
In addition, local
enterprises may fail to meet requirements of EU consumers such as material
origin rules and the Regulation on Registration, Evaluation, Authorization
and Restriction of Chemicals (REACH).
Meanwhile, the fine
arts and handicraft industry mainly uses domestic materials such as rattan,
bamboo and pottery. Recently,
To approach the EU
market, local producers have to meet standards such as REACH and other rules
on packaging and hazard substances in products. There are still a lot of
requirements such as BSCI (Business Social Compliance Initiative) and
Corporate Social Responsibility (CSR) to protect employees and the
environment.
Mutrap experts also
said that the garment and textile sector will see positive prospects in the
EU market. However, if enterprises cannot overcome challenges of CSR and
worker protection rules, apparel export revenues in the market will not
improve.
For farm produce
and seafood, Do Lien Huong, a Mutrap expert, said that non-tariff measures
mean so much in the agriculture sector. Such measures include standards in
hygiene, quarantine, packaging and customs checking.
Standards applied
by the EU are considered as the strictest and prove most expensive in the
world for enterprises.
ACV
prepares for airport expansion
Airports
Corporation of Vietnam (ACV) is planning to expand
ACV is formulating
a project to expand Tan Son Nhat, ACV general director Le Manh Hung told the
Daily after it was reported in the local media that the Government had given
the nod to the plan.
The Ministry of
Transport and ACV would be tasked with expanding Tan Son Nhat. Nguyen Van
Luu, chief of the ministry’s office, said the ministry has yet to receive any
notice from the Government on approval of the project.
Given ACV’s
calculations, Tan Son Nhat should be expanded to build more aircraft parking
spots so that the airport would be able to accommodate 26 million passengers
a year.
The domestic
terminal would be expanded by 2,000 square meters plus an additional
technical area of 500 square meters. Once completed, it would have a total
area of over 39,000 square meters to serve 4,500 passengers at a time,
raising the total capacity of the domestic terminal to 12 million guests a
year.
The current
international terminal has a capacity of 10 million passengers a year and is
expected to run at full capacity this year. Therefore, ACV plans to widen the
terminal to serve 13 million passengers a year.
In addition, the
airport must have 60 to 65 aircraft parking spots, up from the current 40.
With the remaining area of the airport and a part of military-held land
included, 21 parking spots will be built.
However, Le Trong
Sanh, former head of the Tan Son Nhat airport flight management department,
had earlier said that if local authorities reclaim 157 hectares designated
for a golf course in its buffer zone, the land will be able to provide at
least 30 new parking lots.
The airport’s
annual capacity reached 20 million passengers late last year, one year sooner
than earlier estimated. Expansion of both local and international terminals
would help serve six million more passengers.
At present, 44
carriers have flights to and from the airport.
Most speakers at a
meeting in HCMC on Monday to discuss the draft amendments to the Law on
Bankruptcy agreed on the need to have trustees in bankruptcy – a career title
not yet available in
It is popular in
foreign countries to have a trustee in bankruptcy instead of an organization
to supervise and manage the bankrupt enterprise’s assets until liquidation.
The job should be assumed by an individual instead of an organization to
ensure flexibility and efficiency, according to the meeting convened by the
HCMC delegation of National Assembly deputies.
According to
Article 10 of the draft, candidates for the position of a trustee in
bankruptcy include lawyers, auditors, bachelor of laws and bachelor of
economics with at least three years of experience in accounting, auditing,
and corporate governance.
Justin Yap, a
senior expert on bankruptcy law of the International Finance Corporation IFC,
said at the meeting that the trustee in bankruptcy plays the central role in
every modern law on bankruptcy. This person will assist in either the process
of bankruptcy/liquidation or the process of business recovery.
He added that the
bankruptcy trustee must have good reputation and trust from society and the
court, which require this person to have sufficient capacity to perform the
tasks assigned.
At the conference,
the participants agreed that a good salary ladder should be designed to
attract capable human resources.
Under the
Bankruptcy Law 2004, the asset liquidation team is responsible for the whole
bankruptcy procedures. However, the actual practice is still ineffective,
prompting the need to have trustees in bankruptcy.
Statistics from the
People’s Supreme Court show that since 2004 to date, only 83 enterprises have
been declared bankrupt by courts out of 336 filings from enterprises for
performing bankruptcy procedures or for court receivership.
Housing
stimulus package criticised for slow disbursal
A NA deputy has put
up questions about the slow disbursal of the VND30 trillion (USD1.4 billion)
real estate stimulus package which was launched in June last year.
The package offers
loans to property developers at low interest rates of around 6% per year. However,
at the assessment meetings on the adjusted housing laws held on March 6, Ngo
Van Minh, a deputy of the NA's Juridical Committee, said that only 9% of the
package has been disbursed so far.
"Just where is
this package now? If it is not being used then please give it back so we can
use it for other purposes," Minh asked members of the Ministry of
Construction. He went on to say that the package was meant to support
low-income earners, yet many individuals and enterprises cannot get loans
because interest rates are high and the loan terms too short. He proposed
giving a longer loan terms and lifting the cap on the maximum loan amount.
In response, the
Minister of Construction Trinh Dinh Dung, agreed that the terms should be
increased from 10 to 15-20 years so customers will be able to make their
payments. However, if localities and enterprises do not build low-income
housing, he added, the fund would be useless.
"This package
was never meant to be divided up as quickly as possible. These loans must
also have requirements, and the fund can last for many years, perhaps even
until the per capita income of
As of February 17,
2014, the State Bank of
Japan firm
licensed to operate $2 mln
A Japanese firm will
invest in two eco-friendly bus lines that cost an estimated US$2 million
dollars via a joint venture with a local company under a license granted last
month by authorities in a southern Vietnamese province.
The People’s
Committee of Binh Duong Province issued on February 20 an investment license
to Becamex Tokyu Bus Co Ltd, a joint venture between
Becamex Tokyu Bus
will spend over VND40 billion ($2 million) on the bus lines which are
expected to begin operations in May this year.
The new buses will
run on compressed natural gas, also known as CNG, which is more
environment-friendly and cost-effective than normal fuel.
They will ply along
a 20km route between the current provincial capital
Tokyu Group is now
investing in Tokyu Binh Duong Garden City in the province, a 110-hectare
urban area with a total registered capital of $1.2 billion.
Work on the project
officially started in March 2012.
Motorbike
market almost reaches saturation in
Motorbike sales
will continue to slump as the Vietnamese market has almost reached a
saturation point, industry insiders have said.
Only 335,000
vehicles were sold earlier this year, a 3 percent slide compared to the same
period last year, Igarashi said.
Igarashi predicted
that motorbike makers will face a myriad of challenges in 2014 as the economy
is still in a fragile state.
Moreover, the
market is becoming more competitive as motorbike manufacturers have started
to slash prices in order to lure customers.
Motorbike retail
prices in
Even worse, many
motorbike shops have already joined makers in cutting staff to avoid losses.
Kiyokazu Sasabe,
deputy general director of Honda Vietnam, said that two Honda factories in
the
“In the past, we
sold around 20 motorbikes per day right after the Lunar New Year. But that
number plummeted to 5 – 6 motorbikes per day following Tet this year,” a
Honda salesman in
Motorbike producers
have sold 35-37 million products so far in a market of 90 million people, a
Japanese expert was quoted as saying.
The Vietnamese
market has almost reached saturation, where supply exceeds demand, the expert
added.
Motorbike sales
totaled 2.8 million units last year, down 10 percent from 2012 and 15 percent
from a year earlier, statistics show.
The slowdown in
motorbike sales in both 2012 and 2013 has shown a trend of exhaustive
purchasing power, according to the Vietnam Association of Motorcycle
Manufacturers.
Established on
August 26, 2013 in the hope of boosting the local market, the association is
comprised of Honda Vietnam, Suzuki
B. Braun
expands investment in Vietnam
The company will
invest some $50 million in the second phase, which is slated for completion
within 18 months.
Speaking at the
ceremony, Meinrad Lugan, a member of B. Braun Melsungen AG’s management board
said: “Our vision of the future in
B. Braun completed
the first phase of the facility in July 2011 with the total investment of $54
million. B. Braun founded its first representative office in
Last year B. Braun
A widespread cyber
attack has been compromising several hundreds of thousands of wireless
routers in Europe and Asia, with a larger majority of affected devices found
to reside in
The report, titled
Growing Exploitation of Small Office Routers Creating Serious Risks, said
consumer-grade small office / home office (
Pharming is a cyber
attack intended to redirect a website's traffic to another, bogus site.
The security firm
said its report, released on Thursday, detailed the latest campaign in a
growing trend it has observed of cyber criminals targeting
Team Cymru’s
Enterprise Intelligence Services have so far identified over 300,000 devices,
predominantly in Europe and
“Our analysis
indicated that a large majority of affected routers resided in
“Attackers are
altering the DNS configuration on these devices in order to redirect victims’
DNS requests and subsequently replace the intended answers with IP addresses
and domains controlled by the attackers.”
Affected devices
had their DNS settings changed to use the IP addresses 5.45.75.11 and
5.45.75.36.
By doing so, the
hackers will be able to effectively conduct a Man-in-the-Middle attack.
Man-in-the-Middle
attack is a form of active eavesdropping in which the attacker makes
independent connections with the victims and relays messages between them,
making them believe that they are talking directly to each other over a
private connection, when in fact the entire conversation is controlled by the
attacker.
“Cyber criminals
are turning to new methods to achieve their desired goals, without gaining
access to victims’ machines directly,” Team Cymru said.
The affected
devices are vulnerable to multiple exploit techniques, while many cyber crime
participants have become used to purchasing bots, exploit servers, and other
infrastructure as managed services from other criminals.
The reason that
makes SOHO-type wireless routers “a very attractive target for cyber
criminals,” according to the company, is that most consumers are “unfamiliar
with configuring these devices, as well as frequently insecure default
settings, backdoors in firmware, and commodity-level engineering standards
make.”
The report also
indicates that the compromise is not limited to a single manufacturer with a
range of router models from several manufacturers apparently compromised.
“As with the
DNSChanger malware, unwitting victims are vulnerable to a loss of service if
the malicious servers are taken down, as both primary and secondary DNS IP
addresses are overwritten, complicating mitigation,” it warned.
The future figure
will include the amount of 1.1 billion USD set forth by Ca Mau province
alone.
In the first two
months of this year, the region raked in 433 million USD from export of the
product.
To that end, the
provinces have put 596,000 hectares of water area for farming shrimp, of
which 478,000 hectares are in coastal localities as Ca Mau, Bac Lieu, Kien
Giang, Soc Trang and Tra Vinh.
They have strengthened
management over the quality of fries, irrigation systems and the use of
chemicals or substances in farming in order to yield healthy shrimp.
Especially, Ca Mau,
Bac Lieu, Ben Tre and Kien Giang have also provided loans worth more than 500
billion VND (23.5 million USD) for local farmers to improve aquaculture
environment and buy fries and feed.
The Mekong Delta
harvested 380,000 tonnes of shrimp in 2013, accounting for 79.8 percent of
domestic shrimp production. It earned 2.5 billion USD in export of the
product.
ANRPC reported that
in 2013,
The country’s
rubber production has for the first time in its history exceeded 1 million
tonnes, jumping from the fifth position to the third in the global ranking.
ANRPC data also
showed that among the world’s nine largest natural rubber producers,
Chinese
firms rev up operation in Nam Dinh
The People’s
Committee of the Red River Delta
Covering an area of
80,000 sq. m in the Bao Minh industrial park in Vu Ban district, the factory
specialises in producing yarn with an annual capacity of 9,816 tonnes,
weaving (21.6 million metres) and dyeing (24 million metres).
Construction of the
factory, whose land lease contract is for 46 years, is scheduled to be
completed in June 2016.
According to Nguyen
Viet Thang, from the managing board of industrial zones in Nam Dinh, another
investor from Hong Kong (
The province will
submit the project to the Government for approval, he said.
Nam Dinh province
has three industrial parks – Hoa Xa, Bao Minh and My Trung - which house a
total of 127 businesses with nearly 25,000 workers.-
Vietnam
Access Day to open in HCM City
The international
Vietnam Access Day 2014 investment conference next week will offer
opportunities for leading Vietnamese companies and portfolio investors around
the world to exchange ideas and foster links, the Vietnam Investment Review
reported on March 11.
The two-day event,
co-organised by Viet Capital Bank and Viet Capital Securities Co. (VCSC), is
due to take place on March 18 in
It will help
Vietnamese companies capitalise on the opportunity to raise awareness with
global investors, which could provide them with a leading edge to attract
future capital, said VCSC General Director To Hai.
For investors, “we
hope that through Vietnam Access Day, they will be provided with a complete
panorama of the Vietnamese economy, as well as detailed information about the
areas in which they are interested,” Hai added.
Investors will also
go on site visits to Dat Xanh Group’s housing projects, Vinamilk’s factories
and the Ho Chi Minh City Infrastructure Investment Company’s Thu Duc water
plant.
Business leaders
and think-tanks will converge to give presentations and host panel-led
debates.
Nguyen Xuan Thanh,
Director of the Fulbright Economics Teaching Programme, is slated to give an
analysis of
Henry B. Nguyen,
McDonald’s Vietnam Executive Director, will talk about McDonald’s first foray
into
Hot topics include
the real estate market presented by CBRE Vietnam Managing Director Marc
Townsend and efforts to enhance market liquidity by Deputy General Director
of the Ho Chi Minh Stock Exchange Le Hai Tra.
Four panels will
discuss issues of micro-economics, consumer trends, risks to the banking
system, and derivatives and new products for the stock market.
The event would
gather together 200 investors and 38 leading firms, including a majority of
Vietnam Access Day
was held for the first time in 2012 with over 300 attendees, including 210
local and global investors, 60 representatives from
A healthier banking
sector with fewer non-performing loans and increased net exports will support
strong GDP growth of 5.4 percent in
The paper said the
information was cited from a latest report from the
According to the
report, robust growth will come on the back of the country becoming more open
to international investors, which will help attract capital into the economy.
Increases in
government spending, partially thanks to the equitisation of state-owned
assets, is also expected to support growth rates over the next few years.
Demands on energy
will continue to grow with the economic boom and in this regard,
In many ASEAN
countries, demand for energy is growing at a faster pace than domestic
production and continued economic expansion may well mean these economies
becoming increasingly dependent upon international energy markets to meet
their needs.
This will mean
countries are vulnerable to unexpected price movements which could have an
effect on inflation. However, falling global oil prices between 2014 and 2016
– and the entrance of
“Economic growth in
The ICAEW report
Economic Insight:
The report
undertakes a quarterly review of South East Asian economies, with a focus on
the following countries as
Clear
business strategies bring small enterprises long term success
Central Institute
for Economic Management (CIEM) former Director Le Dang Doanh said that small
enterprises could achieve success if leaders adopt clear business strategies
and show self confidence, the Vietnam Economic News reported on March 10.
According to the
General Statistics Office’s data, in January 2014,
However, registered
capital only reached 43.7 trillion VND, an increase of 11.5 percent compared
to December 2013. The number of newly-established enterprises increased while
registered capital reduced.
According to the
General Statistics Office’s data, in 2013,
However, registered
capital only reached 398.7 trillion VND, a decline of 14.7 percent compared
to 2012.
General Statistics
Office General Director Nguyen Bich Lam said that if the average capital size
of a newly-established enterprise reached 6.68 billion VND in 2012, its
figure declined to 5 billion VND in 2013.
Many ideas showed
that production activities and competitiveness capacity of newly-established
enterprises were estimated to be worsened. However, according to Le Dang
Doanh, a small enterprise with small capital could compete with large
enterprises. If leaders focus on researching the market, techniques and
technology and staying away from pursuing immediate profits, they can achieve
success. In particular, in addition to indulgence, entrepreneurs need to show
self confidence to start up a business.
According to Le
Dang Doanh, in 2013, many Vietnamese enterprises bankrupted or halted
operation while some enterprises still strongly developed such as Minh Long
Ceramics and the Rang Dong Light Source and Vacuum Flask Joint Stock Company.
They are not huge
businesses, but with the creativity, they have made outstanding achievements
in business and production activities. In February 2014, Minh Long Ceramics
received an award by the Minister of Science and Technology.
Le Dang Doanh also
advised leaders to show self confidence, strength and intelligence. In
particular, leaders should focus on researching the market to create
necessary goods serving consumer demands.
In addition to self
confidence, strength and intelligence, entrepreneurs need to take care of
staff, contributing to ensuring better living conditions for them.
Entrepreneurs need
to learn experiences from older generations and make a profit to help
enterprises in general and staff in particular overcome difficulties. “If
entrepreneurs take care of their staff, they can achieve success,” Le Dang
Doanh said.
Another important
issue to help small enterprises achieve success is aware of their position
and spending. Phu Thai Group Chairman of the Board of Directors Pham Dinh
Doan said that young entrepreneurs should stay away from pursuing immediate
profits.-
Retail
banking market continues to grow in Vietnam
The retail banking
market in
Head of Retail
Banking at Vietnam International Bank (VIB) Rahn Wood spoke with The Saigon
Times Daily about retail banking market trend in the country.
Development of the
local retail banks in
The retail banking
market in
Consumer loans
(home, auto consumers) and household business loans (personal business) will
continue to be boosted. Banks will also focus on promoting the service of
payments via card by linking with merchant systems such as game companies,
online purchases, electricity/telecom bill payment and supermarkets.
Of course in recent
times there have been some economic challenges and we are hopeful that there
will be further progress to improve the health of some of the banks that have
faced the most difficulties and that consumer confidence in the banking
system will return to its usual levels.
In 2015, the retail
market is also considered an attractive market for foreign banks who may seek
opportunities to participate effectively in
Ocean Dunes
golf course to become urban area
The Binh Thuan
People’s Committee has just approved in principle to transform the existing
Ocean Dunes Golf Club into an urban development area. Located in Phan Thiet
province and operational since 1997, Ocean Dunes is operating at a heavy loss
and can no longer bear the expense.
According to Le Tien
Phuong, chairman of the Binh Thuan People’s Committee, local authorities have
got the thumbs-up to make the move.
The committee will
take the necessary steps to submit a final plan to the prime minister for
approval.
Nguyen Van Dong,
chairman of the Rang Dong Group – the investor in the project – said that
when the proposal is finally approved, the group will invest into a
multi-function urban area named
What an estimated
investment capital of around VND3 trillion ($142.8 million), a third of the
investment will be put into infrastructure such as roads, power and water,
drainage, parks, and others.
Dong said the
changing function of the project will surely increase the efficiency of the
land and an estimated VND1 trillion ($47.6 million) in land taxes will go
toward the provincial budget.
Dong also said that
apart from commercial housing, the investor would develop
“
According to a
report from Binh Thuan Taxation Department, over the last 10 years total
losses sustained by the golf course project have reached VND115 billion ($5.4
million).
Local authorities
evaluated the land and found the efficiency of Ocean Dunes was extremely low
and making little contribution to the local budget.
At the same time,
Phan Thiet city has seen rapid development in terms of both scale and
population. The city’s land fund reserved for public purposes is running low
on supply, particularly as it was recently upgraded to a second grade city.
The renovation of
Ocean Dunes from a golf course to an urban area is a strong move by the city
which will resupply the land fund and help support the city’s goal to
modernise and attract its core business – tourism.
Korean
programme helps agriculture enter value chain
Through a knowledge
sharing programme,
In a senior policy
dialogue on a programme started last year (KSP 2013) at the Ministry of
Planning and Investment (MPI) last week, experts from
According to
professor Yong-Taek Kim from
Another reason was
that coffee is the biggest forex earner and rubber comes in third of all of
Under the KSP 2013,
agriculture is targeted due to its central role in the economy. Up to 70 per
cent of the Vietnamese population lives in rural areas and 50 per cent of the
workforce is in the agricultural industry. At the same time, the country’s
agriculture has developed to the point where it is internationally
competitive.
Clients may
benefit as FPT, Viettel offer pay TV
The local market
for pay television services is expected to see fiercer competition and lower
fees as major telecom providers FPT Telecom and Viettel join for a piece of
the action from April 1 on.
Viettel, a
military-run telecom company, has piloted its cable TV services in
Though Viettel has
yet to announce its official fee rates, sources said that the company will
likely charge as little as VND30,000 (US$1.5) a month for its lowest package.
Current fee rates
fixed by other cable TV service providers such as HTVC and SCTV are around
VND77,000-110,000 a month.
If Viettel’s
official fee rates are that low, the pressure on its major competitors
including HTVC, SCTV, K+, VTVCab, and VTC will be huge.
One of Viettel’s
competitive edges is its availability of some 200,000 km of cables
nationwide.
The company said it
will cut the average cable coverage distance from its cable connecting points
to local households from 350m down to 200m, and even to 100m by 2015.
FPT Telecom,
another major provider in cell phone and internet networks, also enjoys
several advantages over its pay TV service competitors in having an adequate
nationwide network.
The company is also
highly experienced in pay TV services; since 2006 it has offered Internet
Protocol Television (IPTV) services, a system through which television
services are delivered using the Internet protocol suite over a
packet-switched network such as a LAN or the Internet, instead of being
transmitted through conventional terrestrial, satellite signal, and cable TV
formats.
The addition of the
cable TV services serves to realize FPT’s goal of offering its clients
multiple options including the Internet, interactive TV, High Definition TV
(HDTV), and landline and mobile telephone all on a single connection, its
representative said.
“We hope to launch
our digital pay TV services in Hanoi, HCMC, Da Nang, Can Tho, and some other
provinces by the second quarter of this year while making analog pay TV
available to the remaining cities and provinces,” said Nguyen Hoang Linh, FPT
Telecom’s vice CEO.
According to expert
opinions, the local pay TV market will see drastic positive changes in the
coming time following the entrance of Viettel and FPT Telecom.
A race to reduce
fees among the local service providers is very likely to be in the air,
experts predicted.
Some established
providers in pay TV services such as K+ and SCTV have recently offered
discounts and attractive service packages to keep their current clientele and
lure more from their competitors.
The quality of the
services will likely improve as competition will be notably fierce, experts
added.
However, the leader
of a local telecom company asserted that there will not be much competition
in monopolizing sports league games, as this would result in unreasonably
high prices for the games.
“If local service
providers purchase the games’ copyrights together, they will pay lower
prices. Then each provider will have their own development of the games’
content in healthy competition among one another,” he noted.
A plan to develop
local radio and television services by 2020, which was approved late last
year, expects that 60-70 percent of households nationwide will use pay
television services by that time.
The plan also
highlighted the need for all radio and television services to switch from
analog TV to digital terrestrial television by 2020.
According to
national statistics announced in 2011, TV viewers nationwide would have to
spend a staggering VND9.1 trillion ($433.6 milion) buying new reception
devices for digital services.
There are roughly
18.2 million households with television sets in
K+ begins
competitive drive
The local payTV
market is fast becoming more competitive as service providers mount campaigns
to take over market share.
On March 6, K+
announced strategic renovations to improve customer experience and options.
The innovative
change included reorganising its three current packages, simplifying its
subscription fee system and lower equipment prices, applicable nationwide as
of March 8.
Accordingly, the
previous three subscription packages including Access+, Premium+, and HD+
have been reorganised into two new packages – Access+ and Premium HD+.
The Access+ package
consists of 70 channels, including 9 new premium additions such as HBO,
Animal Planet, Discovery and Fashion TV.
The Premium HD+
package has 84 channels though those who use SD encoders will only get 74
channels. Others will get the full package.
Also changed is the
subscription fee for the packages which now will remain consistent throughout
the duration of the contract.
Access+ will go for
VND85,000 ($4)/month and Premium HD+ for VND220,000 ($10)/month regardless of
contract duration.
Equipment prices
will go down to VND990,000 ($47) for an SD equipment set and VND1,800,000
($86) for an HD set. Down from the previous levels of VND1.5 million and VND2
million.
The move is
expected by industry insiders to fuel competition between service providers,
primarily through the competitive pricing.
Prior to K+’s move,
general director of military-run telco giant Viettel Nguyen Manh Hung said
the group was committed to providing customers with the lowest-cost services
to satisfy their demands. He emphasised promoting cable television as one of
the group’s foremost priorities.
Viettel was
licensed to provide cable TV services in April 2013 and pledged to roll out
the service within a year.
The telco said it
was targeting customers in rural and remote areas, capitalizing on its vast
transmission infrastructure advantages.
According to deputy
chairman and general secretary of Vietnam PayTV Association Le Dinh Cuong,
payTV is a healthy competitive market and the consumer benefits when service
providers demonstrate their commitment to offering low-cost quality services.
In respect to service
providers’ concerns over the possibility that new-comer Viettel will apply a
low-cost tactic to woo customers the way it did, and succeeded with, in the
telecom sector, Cuong said, “The association has urged government agencies to
finalise a floor-pricing scheme in this year’s second quarter to ensure
healthy market competition.”
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Chủ Nhật, 16 tháng 3, 2014
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