Vietnam flag, background with space for your logo - industrial 3D illustration. 5G smart mobile phone radio network antenna base station on the telecommunications mast emitting signal. 3D-rendering

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Vietnam is ahead of the game with commercial 5G

  • Vietnam is one of the earliest countries to successfully pilot 5G technology worldwide
  • But the path to commercialization still poses difficulties

In 1992, Vietnam was just starting to use 2G network technology. It wasn’t far behind other countries in doing so but by the time 3G and 4G rolled out 8 or so years later, it had begun to lag behind.

Fast forward to May 2019, Vietnam became one of the first countries to successfully establish a 5G-powered phone call. Given Hanoi’s ambitious plans to deploy a 5G network for commercial operations using domestically-developed technology — it was a technological milestone for the country. 

The number of 5G subscriptions in Vietnam is forecast to reach 6.3 million in 2025, according to network equipment maker Cisco. The early rollout of 5G services could help Vietnamese mobile carriers increase revenues by US$300 million a year, starting from 2025. However, they need to invest about US$1.5-2.5 billion in technology during the next five years. 

Vietnam is on track right now to meet its lofty 5G ambitions, but the path ahead includes a myriad of obstacles in technology, national security, and governance.

The official frequency planning announced by the country’s Ministry of Information and Communications (MIC) on August 20 this year is considered a giant step forward in Vietnam’s 5G development roadmap. 

The ministry permitted Viettel and MobiFone to launch the commercial pilot of 5G technology until mid-2021. The former carrier is allowed to pilot 5G services at no more than 140 locations in Hanoi. The latter will carry out this pilot in Ho Chi Minh City (HCMC) at up to a maximum of 50 Base Transceiver Stations (BTSs).

These pilot schemes are used to evaluate the potential of the market and the stability of 5G equipment before formal commercialization. Participants in these pilots are selected subscribers of Viettel and MobiFone with provided telecoms codes.

Accordingly, Viettel is allowed to test a commercial 5G network in Hanoi with a scale not exceeding 140 stations. The firm will be entitled to use planned frequency bands, including the 2,500 – 2,600 MHz, 3,700 – 3,800 MHz, and 27,100 – 27,500 MHz bands for 5G commercial testing. Viettel, which claimed to have developed its own 5G radio network base stations, announced in January that it planned to roll out commercial 5G mobile services in June. The firms claimed Nokia equipment instead of China’s Huawei during the trial.

MobiFone, meanwhile, was licensed to test at the 2,600 MHz bands with no more than 50 stations in Ho Chi Minh City. However, both Viettel and MobiFone have not yet announced their detailed testing plans. Their trial license is valid until June 30, 2021.

Progress and problems

Prior to these commercial pilots, many Vietnamese mobile carriers like Viettel, MobiFone, VinaPhone have finished the technical test of the 5G tech, making Vietnam one of the earliest countries to successfully pilot 5G in the world. Results show that along with the 10-time-faster speed, 5G’s latency is only one-fifth of 4G’s. 

To put things in context, Vietnam’s advanced mobile networks reach about 96% of the population, providing 51.2 million users with 3G coverage and 13 million with 4G. Viettel holds a 51.5% share of the broadband market, followed by VNPT with 28.4%, MobiFone with 12.7%, and FPT Telecom with 3.8%.

Last month, the Minister of Information and Communications Hung during a question and answer at the National Assembly in Hanoi said Vietnam’s progress was “not slow” or out of line with the international speed when asked about the progress of the national 5G network.

He also said the deployment of 5G in Vietnam would make use of about 70% of the existing 4G infrastructure – including base transceiver stations, antennas, and other transmission equipment – translating to sizeable cost-saving. According to the government, the rollout of 5G will start first in major urban areas, which will be followed by industrial parks, research zones, and universities to aid innovation and creation of new technologies, the minister added.

Among predicted difficulties, include high device and service cost, a selection limit of 5G-supported terminals, and narrow network coverage. In addition, due to the Covid-19 pandemic, the pilot schemes in Vietnam could not be carried out as fully as wished, let alone the trouble in communication between regions and transport of necessary equipment.

Hung, however, said he was confident that 5G equipment and devices to be used by telecommunications and mobile operators will be fully Vietnamese-made, of high technology, and come at more affordable prices than imported versions.

The government is also working on new national technical regulations for terminal devices of terrestrial mobile communication, which will require that all portable data terminals (PDTs) made in, sold, or purchased in Vietnam will have to support 4G and 5G technologies. This also means phones that only support 2G and 3G networks might no longer be manufactured in Vietnam or imported into the country when the new regulation comes into effect as an effort to phase out these older technologies, Hung said.

The regulation is expected to be issued this month and take effect from July 2021.

A recent report by mobile industry specialist GSMA Intelligence found Vietnam standing out as a ‘digital progressive’ in APAC.

In just three years, after decades in the digital wilderness, the traditionally agrarian market has undergone a rapid digital transformation driven by “improvements to the digital identity, digital citizenship, and digital lifestyle components.”

Vietnam now sees digital transformation as the key to boosting its economy. GSMA noted that the Vietnamese government has been pursuing a national Industry 4.0 strategy that includes infrastructure and human resources, along with e-government services and innovation initiatives like an e-commerce transformation plan that is expected to grow online businesses by up to 43% within the next five years.