Even though a pioneer, why is 5G commercialization in Vietnam slow?

5G subscribers only gained 0.54%

According to The Mobile Economy 2022 of GSMA, there have been 209 operators deploying commercial 5G globally in 83 countries and will reach 1 billion connections globally by 2022.

The report also shows that investment in 5G will account for a great percentage of mobile operators’ total investment in the period of 2022-2025. Thereof, investment in 5G during this period will account for 85% of the total $ 620 billion expected by mobile operators to invest in building and developing their networks.

Vietnam is a pioneer in accessing and deploying 5G networks. Since May 2019, Vietnam has been one of the first countries which are successful in establishing 5G technology phone call. From the end of December 2020 to now, the 3 carriers, Viettel, Vinaphone, and MobiFone have commercialized 5G in 20 provinces and cities nationwide.

After nearly 18 months, when the world was successful in 5G commercialization, Vietnam has not yet been able to commercialize 5G, the rate of connection and use of 5G is quite low. Thereof, out of a total of more than 71 million mobile broadband subscribers (3G, 4G, 5G), the percentage of 5G subscribers is only 0.54%, or more than 360,000 subscribers.

According to the assessment of the Ministry of Information and Communications, the research and development of 5G equipment from 2019 up to now can be assessed as a breakthrough with Vietnam's current resources,. However, it is not possible to meet the deployment of 5G with equipment completely originated from Vietnam on a large scale in 2022. The reason is from the difficulty of supply chain disruption, Covid-19 epidemic and the shortage of semiconductor chips that have extended the research and production time by 10-12 months.

Thereby, there are also technical and technological challenges. 5G technology standards for product and service quality are evolving and the issuance has not yet been internationally agreed upon. In addition, there are difficulties in investment resources. Vietnam has only invested about USD 65 million for 5G, while the big firms in the world have invested from 2 to USD 10 billion.

Removing barriers

Carriers are much worried that the rate of 5G users is lower than the expected rate. In a petition sent to the Ministry of Information and Communications, VNPT Group said that operators have provided trial 5G services, however, the conditions for commercialization have not yet been fully satisfied due to bandwidth limitations, development of 5G ecosystem and high deployment costs.

VNPT proposes the Government and the Ministry of Information and Communications to apply the policies to promote the development of 5G ecosystem in such economy industries as industry, services...; supporting enterprises in the early stages of 5G deployment, such as: exempting/reducing taxes on equipment and frequency import fees, financing 5G projects; soon conducting the master planning and implementation of plans for auction and selection of frequency bands in 2022.

Said Mr. Huynh Quang Liem, General Director of VNPT, Vietnam will own many benefits if we can master the global new technologies such as 5G and 6G here. VNPT continues to implement the strategy of expanding 4G coverage and commercializing 5G by 2022 as planned and in line with customer needs.

Said Mr. Liem, " 5G investment in a large scale can only be carried out when the demand and percentage of users reach a certain scale".

For wide-area 5G coverage, 5G commercialization requires between 30,000 and 70,000 5G BTS stations. With the current investment rate of about VND 1 billion/station, the investment cost for this option will be from 30,000 to VND 70,000 billion.

Therefore, in the initiative of the Ministry of Information and Communications, the 3 carriers will invest and use the same 5G network. At the Conference - Exhibition Digital World (ITU Digital World) 2021, Vietnam will implement a solution to accelerate 5G coverage by mobilizing network operators to jointly invest, said Nguyen Manh Hung, the Minister of Information and Communications.

"Thus, the investment cost of each carrier is reduced and Vietnam will have a nationwide 5G network in just one year," said Minister Nguyen Manh Hung.

A representative of the Ministry of Information and Communications said that, through testing, the ministry proposed businesses to assess the needs of the market and propose policies and licensing criteria to match the conditions of businesses. The ministry is also planning the bands 6/7 GHz and above 40 GHz for 5G mobile communications. The 900 MHz, 1800 MHz and 2100 MHz bands are also reallocated to 4G and 5G.

Said Mr. Nguyen Phong Nha, Vice Director in charge of the Department of Telecommunications, in 2022, the Ministry of Information and Communications will add 2.3 GHz band for network operators to develop 4G infrastructure, along with that will officially license the commercialization of 5G. At that time, the mobile speed of Vietnam will be improved and the coverage area will also be improved. Also in 2022, the 5G network will be guaranteed to provide speeds of over 100 Mbit/s for coverage in industrial parks, export processing zones, in large urban areas, by 2025, basic coverage of major provinces and 100% of the population will be covered by 5G by 2030.

“Network carriers need a roadmap, a plan to stop investing in old technology infrastructure to promote smartphone use and stimulate data usage. Redirect investment for next-generation mobile networks, deploying 5G mobile networks with priority given to sharing radio infrastructure and roaming, "said Nguyen Phong Nha.

5G is expected to have a major impact on the global economy, forecast to create about $13.1 trillion and 2 million new jobs by 2035.

The contribution of 5G to Vietnam's GDP growth is forecast to reach 7.34% by 2025.

Source: Institute of Information and Communication Strategy

Source : Baodautu