VietNamNet Bridge - The three largest Vietnamese mobile network operators have announced everything is ready to provide 4G services. Users’ expected spending on the services would account for 5 percent of monthly average income, or VND170,000 a month.

Suvi Lenden, the ITU Special Envoy for the Broadband Commission for Digital Development, said at a workshop on the future of broadband technology in Vietnam in late May that the broadband service fee in the world was still too high. In theory, the spending on services should not be higher than 5 percent of users’ monthly income.

In order to reduce the broadband services fees, she said governments need to apply comprehensive policies on frequency band management and measures to encourage competition among network operators.

Vietnam has taken measures to make 4G more popular among people, while having built a good environment for businesses to develop infrastructure items and access rural areas.

However, as the majority of Vietnamese live in rural areas, she noted, it is necessary to take stronger measures to decrease service fees further, paving the way for a broadband services’ boom in some years.

Official reports show that the average income per capita was $2,028 in 2014, or $169 a month. If referring to the formula the expert suggested, i.e., the service fee should not be higher than 5 percent of a person’s income, mobile network operators should charge VND170,000 in service fee every month. 

The three largest mobile network operators have announced they can provide broadband services at prices below 5 percent of total income as suggested by Suvi from ITU.

Nguyen Manh Hung, deputy general director of MobiFone, one of the three largest operators, noted that the demand for data service has been increasing rapidly in recent years.

As most MobiFone’s subscribers are in large cities, its ARPU (average revenue per user) is higher than that of other network operators. This is a great advantage for MobiFone to develop services.

In 2012-2014 alone, MobiFone developed 5 million 3G subscribers, while the revenue from data service increased from 5 percent of its total revenue to 30 percent. It is expected that call and SMS services would bring 30 percent of its revenue by 2020, while the remaining would come from data service.

Hung noted a growing tendency of using data service instead of call and SMS service. Clients would rather spend VND5,000 to download a clip at higher speed than spending VND5,000 on a call.

Therefore, he said he was not worried about the Vietnamese spending level on 3G or 4G services in the future, saying that 5 percent of users’ income is “acceptable”.

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