VietNamNet Bridge - Unlike most developed markets, Vietnamese mostly buy smartphones from retailers.

Vietnamese mostly buy mobile phones from retailers

In Europe and the US, people can buy smartphones under the mobile network operators’ policy. In exchange, they can access preferential prices when they commit to use service packages provided by the operators for a certain time.

With the policy, users have opportunities to own smartphones at 40-50 percent, or sometimes 70 percent, lower than the retail price. 

Customers can also use preferential service packages offered by telcos. They, for example, can make certain number of fee calls and messages, or use a limited amount of data for free. 

A report shows that the Vietnamese mobile phone market is valued at $3.7 billion. Of this, nearly half of the revenue went to Samsung. Apple and Oppo made up 40 percent and 20 percent, respectively, of total number of products sold.

In Vietnam, the distribution of mobile phone is in the hand of retail chains.

A representative of MobiFone, the network operator pioneering subsidy programs, said post-paid subscribers, who are considered loyal clients, are the biggest beneficiaries from this mode of sale.

MobiFone, VinaPhone and Viettel are the three largest mobile network operators in Vietnam, which now hold 95 percent of the Vietnamese mobile telecom market..

Users purchase products by instalments and pay monthly for the service packages they commit to use.

Buying smartphones from network operators is the easiest way to access luxury products. 

However, the mode of sale also puts network operators at a disadvantage. In principle, mobile network operators have to advance money to pay to manufacturers, so that users can obtain products at low prices. 

The money advanced will be offset by the monthly pay from subscribers using service packages.

Nguyen Viet Anh, deputy CEO of FPT Shop, the second largest mobile phone retail chain, said FPT Shop sometimes cooperates with telcos to sell smartphones this way.

However, he said, in other countries, telcos have methods to force clients to fulfill their commitments. In Vietnam, there is no effective way to sell smartphones under a subsidy policy. 

The Gioi Di Dong (Mobile World) and FPT Shop, belonging to FPT Retail, are the two largest mobile phone distributors in Vietnam. The sales of Apple’s products (iPhone, iPad, MacBook and Apple Watch) in Vietnam are roughly $1 billion, of which 70 percent are from iPhones.

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