Vietnam has, for the first time, granted a licence to a wholly foreign-owned company to provide telecommunications services, allowing Starlink Services Vietnam, a subsidiary of SpaceX, to roll out low Earth orbit satellite internet. However, with the country’s already extensive infrastructure and some of the world’s most affordable internet pricing, the scope for direct competition remains limited.

Under the pilot programme, Starlink is permitted to serve up to 600,000 subscribers. The company will deploy four gateway stations in Phu Tho, Da Nang and Ho Chi Minh City, enabling direct connectivity between satellites and terrestrial internet infrastructure.

The move extends Starlink’s footprint in Southeast Asia, following its presence in the Philippines, Malaysia, Indonesia and Timor-Leste. Yet from the outset, the question of competitiveness looms large.

According to a source cited by VietNamNet, Starlink’s service is expected to cost around US$85 per month, equivalent to approximately VND2.2 million, with initial equipment priced at about US$350. These figures raise concerns over its ability to compete with fibre broadband and mobile data services in Vietnam, where costs remain significantly lower.

Doan Quang Hoan, Vice Chairman of the Radio and Electronics Association, noted that Vietnam’s terrestrial telecom infrastructure is both highly developed and widely accessible, leaving little room for satellite internet in the mass market segment.

Data from the Authority of Telecommunications shows that by April 2025, Vietnam had deployed more than 318,000 base transceiver stations, covering over 99.8% of the population with mobile broadband and serving approximately 119 million subscribers. Notably, 5G coverage has already reached 25.5% of the population within less than a year of commercial rollout.

In the fixed broadband segment, the country counts 24.4 million subscribers, with average speeds reaching 176.68 Mbps, up nearly 47% and ranking 33rd out of 155 countries globally. Fibre optic connections account for 85.1% of households, with infrastructure extending to every commune nationwide.

Against this backdrop, Starlink offers limited advantages in terms of cost or convenience compared with existing services.

Instead of acting as a direct competitor, satellite internet is increasingly viewed as a complementary solution. Its greatest value lies in areas that remain difficult to serve, including remote, mountainous and island regions where fibre deployment is either prohibitively expensive or economically unviable. These are precisely the gaps that traditional telecom infrastructure has yet to fully bridge.

Starlink also holds strategic importance as a backup communication layer in the event of natural disasters, storms or large-scale network disruptions. When terrestrial systems are compromised, satellite connectivity can help maintain uninterrupted communications.

In terms of applications, the service is particularly suited to specialised sectors such as search and rescue operations, national defence and security, remote education, as well as maritime industries including shipping, offshore fishing and oil and gas activities.

Enterprises operating in isolated locations, such as mining, forestry, small hydropower projects or infrastructure developments across mountainous terrain, are also considered potential customers.

Another segment likely to absorb Starlink’s higher pricing includes premium services such as remote resorts, yachts or users requiring stable, independent international connectivity.

Viewed as a whole, Starlink is not entering Vietnam to compete head-on with domestic telecom providers, but rather to tap into niche markets where conventional infrastructure remains insufficient or inefficient.

While these segments may be limited in scale, they carry strategic significance for infrastructure resilience, marine economic development and national connectivity.

In this context, Starlink may not trigger a market share battle, but it can still play a meaningful role as an additional layer of infrastructure, contributing to a more flexible and resilient telecommunications ecosystem.

Thai Khang