VNPT, Viettel Group chase global market share

As of end of 2016, VNPT, which was founded in early 2006, had manufactured and sold roughly US$400 million of optical fibre cables and related cable termination equipment in both domestic and foreign markets. 

However, since its inception, the company generated revenue of only a few million in foreign markets, which sales were comprised of relatively small contracts spread over 30 countries in principally Asia, Europe and Africa.

But the nature of the telecommunications equipment market is changing with an accelerating shift of economic activity from Europe and North America to markets in Africa, Asia, and Latin America.

The leaders of VNPT believe, like the International Monetary Fund, that the ten fastest-growing economies in telecommunications during the years ahead will all be in emerging markets such as Vietnam and those in ASEAN.

Against this backdrop, they believe that continuing advances in information and communications technology have opened the doorway a crack and make it possible for VNPT to coordinate with global companies and flourish.

VNPT leaders say they plan on knocking on every operator's door having shaken off the image of poor quality products that plaques so many other products made in Vietnam. Our quality is strong and continually improving, they say, and their track record shows they have gained consumer trust.

The barriers to gaining global market share entry for new companies are very strong and primarily revolve around the necessity for massive capital expenditures and marketplace difficulties.

In 2016, VNPT began construction of a second manufacturing facility at the Hoa Lac Hi-tech Zone in Hanoi, which is expected to be placed in service in 2017 and more than double the production capacity of the company.

VNPT has also broken ground on a new 5,000-square-meter facility to produce glass fibre cables in the northern province of Bac Ninh that has a total budget of US$12.87 million (VND287 billion).

Tran Manh Hung, president of VNPT group, said with the addition of these two facilities, the group targets to supply product in 10 countries in the consumer goods, medical and healthcare fields.

Meanwhile, Viettel, owned and operated by the Ministry of Defence since its founding in 2004, has managed to emerge at the fastest growing 4G provider in Vietnam, having established roughly 10,000 4G base transceiver stations in just the past few months alone.

In the first quarter of 2017, Viettel will export 4G equipment to Laos and Timor Leste pursuant to some of its first foreign contracts to install equipment it manufactured at its facilities located in Vietnam.

Hoang Son, deputy general director of Viettel, said the company targets to design and expand its manufacturing base and exports to be right at 70% of its revenue, adding that the company is the first network service provider in Vietnam to get into export-oriented industrial production.