A decision to break monopoly
Before 1995, the Vietnamese telecommunications market was an exclusive arena for the Vietnam Posts and Telecommunications Group (VNPT). In 1995, SaigonPostel came into being with the aim of breaking the monopoly of VNPT and creating a competitive telecommunication market in the country.
In fact, VNPT still dominated the domestic telecommunication market even though Viettel joined the market at that time. This was because both SaigonPostel and Viettel were comparatively small in terms of business size and capital. They had no services compared to VNPT’s and as a result only gained modest market shares.
However, the situation started changing when Viettel was the first and single telecom that provided the service of VoiIP. Mr. Mai LiemTruc, the one that signed the license, would never think that his decision allowing Viettel to provide the service could later lead to a big change in the Vietnamese telecommunication market. From its success in providing the service to customers, Viettel continued investing in its telecommunication infrastructure and rose up to the largest telecommunication services provider in Vietnam.
In fact, Mr. Truc who had worked at VNPT before leading the General Department of Post was badly criticized when giving Viettel the license. Some believed that Viettel would suffer failure as it was established just one year ago so it would not have technology, capital, and experience to successfully realize the VoiIP project. Others suspected that the director might get personal benefits from giving the license to Viettel. In this circumstance, he had to bet his political career on the success of Viettel and the development of Vietnam’s telecommunication sector.
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Viettel’s staff instructs customers to use Viettel's service |
Apart from his trust in the uniform technicians and businessmen, Mr. Truc also embraced the policy of the Party and Government on promoting competitiveness and breaking the monopoly in the domestic telecommunication market.
“At that time, I intentionally gave priority to Viettel as it was a new telecom and was run by military people. I thought if the company had not been allowed to provide the VoiIP service, it could not have had capital to invest in its infrastructure and other services. Furthermore, if Viettel had not developed, this meant that the policies of the Party and government to open and develop the domestic telecommunication market would not have been realized. I was not afraid of being dismissed from my duties. I only thought that I should do something to the telecommunication sector and the country,” Mr. Truc confided.
Low-cost telecommunication service revolutionary
On the morning of October 15, 2000, for the first time, the Vietnam Television broadcasted the ad “178 – your savings account” on its channel, officially unveiling the new communication service of VoiIP run by Viettel. It can be said that Viettel launched a new revolution in the domestic telecommunication sector. Later, VNPT and SaigonPostel jumped on the bandwagon, developing and operating their own VoiIP services.
As VoiIP was new to all three telecoms, the domestic telecommunication market started to see an equal competition among them. With VoiIP, the telecommunication providers had to lower the costs of their communication services. In fact, on average, a call on VoiIP cost only a fourth of a normal phone call. The providers also launched a number of promotional programs to retain their subscribers and lure new customers.
Thanks to VoiID, Vietnamese customers enjoyed low-cost communication services and the domestic telecommunication sector developed robustly. The VoiID providers also earned big profits from the service so they had more capital to invest in their telecommunication networks and new services. From then on, Viettel and SaigonPostel were able to compete with VNPT, which made the domestic telecommunication market more open and more competitive, and boosted the development of the domestic telecommunication sector.
Although Viettel was a young telecom at that time, it continuously improved the quality of its services and took the lead in reducing the costs of all communication services. As a result, it attracted an increasing number of customers and stood firm in the domestic telecommunication market.
Major general Le Dang Dung, Acting President of Viettel said, “Since we [Viettel’s staff] started providing telecommunication services, we have always wanted to provide low-cost but high-quality services for customers and contribute to national socio-economic development. Viettel also takes the lead in building telecommunication networks on islands and in remote mountainous areas as well as offering discounted telecommunication services to disadvantaged people.”
In fact, few people know, from a military-run company with an initial capital of only US$10 million, Viettel has become a telecommunication giant thanks to its decision to invest in and provide VoiID 15 years ago.
Translated by Thu Nguyen