VietNamNet Bridge – Existing cable televisions have hurried to change their business strategies in anticipation that the big guy in the telecom sector, Viettel-- when joining the market, would try to scramble for clients with surprisingly low fees.

Pham Van Lam, a new worker of Viettel’s Cable TV, said he has to try every possible ways to get seven more cable TV contracts to have 10 contracts this month as requested by the company.

He is one of the hundreds of marketing workers of Viettel, which has joined the cable TV battle. The workers have been asked to run a race with the other “big guys” and obtain bigger and bigger market shares as soon as they can. Especially, Viettel is also “eyeing” the “throne” on VTV’s head.

Will the history repeat itself?

Viettel is believed to upset the current cable TV market like it did with the telecommunication sector two decades ago.

At that time, no one thought that Viettel could fight against VNPT, the biggest group in the telecom sector. However, it could do this with the low-fee strategy.

The reasonable business strategy has helped Viettel develop so strongly that its turnover and pre-tax profit soared to $2 billion and $1.2 billion in 2013.

After reaping fruits on the telecom market, Viettel kicked off its plan to conquer the pay-TV market. The 200,000 kilometers of fiber cable covering 95 percent of the areas throughout the country proves to be the biggest advantage that Viettel would take full advantage of to do business in the pay-TV market.

Nguyen Manh Hung, Viettel’s General Director, once stated that Viettel can provide cable TV services just after a short period thanks to the big fiber cable network it possesses. Meanwhile, it would take others at least one decade to build up such a large network.

Viettel received the license for cable TV services in April 2013, which says that Viettel cannot provide services in the eight provinces and cities, which are the main sources of income for VTV’s units. In return, it can provide digital cable TV services throughout the country.

Analysts said that the powerful infrastructure system would allow Viettel to provide services at low fees, the key factor that determines the success.

Le Dinh Cuong, Secretary General of the Vietnam Pay-TV Association, also said televisions fear that Viettel would attract subscribers by offering the fees lower than the average fees.

AVG now charges VND33,000 a month on its lowest-cost service package. VTC has said it may design the service package at the low fee of VND30,000. Meanwhile, sources have said that Viettel may offer the service packages at below VND30,000.

The information has not been confirmed yet, but analysts believe that Viettel can provide services at low fees because its income from telecom services can offset the losses in TV services.

Two tigers will fight for supremacy

To date, VTV, the national television, still does not have any rivals on an even footing. However, analysts believe that the situation would be different when Viettel turns up. They think that VTV and Viettel would be the two big tigers who would fight for the supremacy in the market.

According to the Competition Administration Department, SCTV held 40 percent of the cable TV market in 2012, while VTVCab 30 percent and HTVC 15 percent. As such, the two subsidiaries of VTV, including SCTV and VTVCab, alone held 70 percent of the market share.

NCDT