VietNamNet Bridge – With only 2.5 million subscribers at this moment, the paid-TV market is still spacious in Vietnam.

 

Potential market

 

At a conference on paid-TV held in the central city of Da Nang in late May, Deputy Minister of Information and Communications Do Quy Doan said that paid-TV services have developed quickly in Vietnam in the last ten years, with around 2.5 million subscribers and hundreds of TV channels at present.

 

According to the Ministry of Information and Communications (MoIC), all 63 provinces and cities in Vietnam have at least one cable TV network. Some 43 percent of urban families are using cable TV services and 18 percent use satellite TV receivers. Paid-TV services have boomed in Vietnam, with various types like cable, digital, satellite, mobile, IP TV services, offering many choices for users.

 

Manuel Rougeron, Executive Director of VSTV (K+ channel), said that Vietnam is considered as a potential market for paid-TV services because the rate of families that use paid-TV services in Vietnam is still low. In other countries, this rate is 50-60 percent.

 

Of over 50 paid-TV service providers in Vietnam, Canal+ is the first foreign investor. This French TV firm with over 13 million subscribers has cooperated with the national Vietnam Television (VTV) agency to launch paid-TV K+ channel, with nearly 200,000 subscribers, accounting for nearly 10 percent of the market. Experts said that paid-TV services will develop strongly in Vietnam in this decade.

 

According to a plan approved by the Vietnamese government in 2009, analog TV technology will be replaced by digital technology by 2020. This is the common trend in the world. Luxembourg is the first to complete the change, followed by the Netherland, Finland, the US, Germany, Switzerland and Sweden.

 

It is the fact that digitalizing television is closely linked with the shift from free TV services to paid-TV services. This is a chance for the development of paid-TV services in Vietnam. However, experts anticipate that the paid-TV market in Vietnam will get saturation in ten years.

 

Competition needs control

 

At this moment, competition in the paid-TV market is very fierce, with big guys like VTC, HTVC, VSTV, SCTV and the participation of telecom groups like Vietnam Post and Telecommunication Groups (VNPT), Corporation for Promoting and Financing Technology (FPT) and provincial cable TV stations.

 

Though digital TV technology is forecast to gradually hold the upper hand over analog TV technology but at present, cable TV still holds a large market share thanks to its low input cost, its fit to wireless equipment and its popularity to most of audiences.

 

In this fierce competition, paid-TV service providers have lured clients by many “tricks”, such as exempting installation charges and claiming low monthly subscription fees of several USD.

 

While VTC offers new subscribers with 12 free months of subscription fees, VNPT reduces charges and the price of its decoding equipment for Internet IPTV service. K+ has reduced the charges by 20-50 percent and increased the number of channels in all service packs.

 

However, the boom of paid-TV services in Vietnam has created many issues related to copyright and competition to hold broadcast right of international football events, etc.

 

Some paid-TV service providers still add advertisements to paid-TV channels though the nature of paid-TV is collecting fees from subscribers to supply them with “clean” TV channels (without advertisement).

 

Deputy Minister Do Quy Doan said that the paid-TV market needs control to develop in sustainable manner. A regulation on management of paid-TV took effect on May 15, 2011.

 

PV