VietNamNet Bridge – After the racing for the turnover of 100 trillion dong in 2010, the Military Telecom Company (Viettel) and the Vietnam Post and Telecommunication Group (VNPT) declare a new war as they have both set up new targets for 2011 – the turnover of 130 trillion

Profit: it’s six of one and half a dozen of the other

In fact, VNPT set up a more modest goal at first, of 94 trillion dong in 2010, which would be an increase of 20 percent in comparison with 2009. The leaders of the economic group said that they anticipated big difficulties in 2010 so they only dared to set up such a modest target.

Several days later, Viettel announced the targeted turnover of 96 trillion dong for 2010, which would represent a 60 percent growth rate in comparison with 2009.

this would mean that VNPT would lose its first position on the telecom market. Therefore, VNPT decided to increase the targeted turnover to 100 billion dong for 2010.

Then, with the ambition of jumping into the first position on the market, Viettel also decided to adjust its targeted turnover to 100 billion dong.

Finally, VNPT announced it has fulfilled the business plan, obtaining the turnover of 101,569 billion dong in 2010. With the figure, VNPT confirmed that it was the only telecom company that couldobtain the turnover of over 100 trillion dong in 2010. Viettel’s turnover was more modest at 90 trillion dong.

However, analysts say the turnover figures are not everything. An analyst says that directors can be described as talented painters who can polish their figures and make them more beautiful. Therefore it would be better not to compare the turnover, but to consider their profits.

Some months ago, Harvard’s Professor Michael Porter, the leading expert in competitive strategy, for the first time released the report on competitiveness of Vietnam based on objective figures. Many experts believe that the report should be the good foundation for the information technology and communication industry in Vietnam.

The professor said that in many business fields, Vietnamese enterprises have been facing difficulties just because they have been trying to use the same methods and compete in prices. Competitions should be seen from the angle of profit, not turnover.

In fact, the gap between the turnover and profit of VNPT and Viettel is narrow. While VNPT obtained 11,200 billion dong in profit in 2010, the figure of Viettel was 10,687 billion dong. VNPT paid 8450 billion dong to the state budget, while Viettel paid 7315 billion dong.

How will the new race be?

In a recent survey, Viettel announced the targeted growth rate of 19 percent for 2011, and the expected turnover of 109 trillion dong. However, Buu dien Vietnam (Vietnam Post) newspaper has quoted its sources as saying that Viettel plans to get 130 trillion dong in 2011.

Meanwhile, VNPT has also set the goal of 130 trillion in turnover in 2011.

though the targeted turnover is the same, the targeted profits are different. If they both get 130 trillion dong in turnover as expected, VNPT would get the profit of 11,800 billion dong, while Viettel would get the profit of 17,106 billion dong. This obviously means the big challenge for VNPT.

Experts say that both VNPT and Viettel will rely on their income from mobile phone services. VNPT has two mobile networks MobiFone and VinaPhone, and it also has income from broad band Internet and fixed line services. Meanwhile, 60 percent of Viettel’s income comes from mobile phone services. Besides, it can also get money from real estate, phone distribution and Internet services.

Source: Dau tu