FPT decides to go through “4G door” to join telecom market

VietNamNet Bridge – Failing to enter the domestic mobile telecom market by purchasing a domestic telco, FPT (the Corporation for Financing and Promoting Technologies), a big name in the hi-tech sector, has never given up the hope of providing telecom services.

Truong Dinh Anh, General Director of FPT, has affirmed that becoming a mobile network operator is one of the most important goals of the group.

“We tried to seek opportunities to jump into the telecom market, and the unsuccessful affair of purchasing EVN Telecom was one of the opportunities,” Anh said. “Over the last year, since we kicked off the EVN Telecom project, we have got experience about the market; while previously, we once lacked information”.

However, FPT understands well that a stiff competition is occurring on the telecom market, which has forced the ARPU (average revenue per unit) down to the deepest low – four dollar for the highest ARPU. Meanwhile, mobile network operators have continuously launched the unlimited service packages to attract users.

“With the current ARPU, any new operator would not be able to survive,” Anh said. Only big operators, who have been providing services for the last many years, can survive and develop, because they have got enough money to build firm infrastructure.

Over the last 3-4 years, when joining the market, new network operators can attract certain numbers of clients by offering big discounts. However, the clients would leave the operators and use the services of other new service providers, who also offer big preferences.

“A lot of operators have suffered big losses because they joined the market at unsuitable moments,” Anh said.

He went on to say that FPT needs to enter the mobile telecom market through “a new door”, meaning that FPT needs to target new technologies which make it superior to other rivals. And FPT is targeting LTE technology.

In August 2010, FPT got the license to test LTE in Hanoi and HCM City. However, since LTE has been just on the trial period, every operator has been allocated 10 MHz, FPT still cannot apply LTE in a big scale.

“Every operator needs to have 20-30 MHz in order to provide good LTE services. We are waiting for the LTE technology to become “ripe” and the equipment to become cheap enough to begin launching LTE services,” he said.

3G technology appeared in 2002, but 3G equipment only became affordable by people after 7-8 years. The base stations for LTE technology remain too expensive which is double the stations for 3G. Besides, the terminal equipment for LTE technology is also 6-8 times more expensive than 3G devices.

For the time being, FPT has been moving ahead with the plan to conquer foreign telecom markets. It is conducting negotiations to purchase telecom companies in Laos and Cambodia.

Over the last three years, FPT has been following its 3-phase strategy to make outward investment. In the first phase, FPT builds up backbone lines to the borders, from which it provides connection capacity to operators in Laos and Cambodia.

FPT has created a “revolution” in the broadband market in Cambodia. “Before the appearance of FPT, 1 Mbps in Cambodia was priced at 1000 dollars, while the figure has dropped to below 300 dollars,” he said.

Now FPT is taking the second step in the strategy – buying existing networks in Cambodia to provide services in the market.

Anh has declined to reveal which companies in Laos and Cambodia FPT plans to purchase – a broadband Internet company or a mobile company.

Meanwhile, Deputy General Director of FPT said in April 2011, FPT officially became the partner of two Lao telcos, Lao Tel and ETL. It is expected that FPT will begin providing services in August in Laos.

FPT is also eyeing Nigerian market. On July 5, FPT and Century Technologies signed an MOU on strategic cooperation in telecom.
vietnamnet.com.vn