The Internet playground is hard to have places for ISPs to come later

Internet market is witnessing a fierce race among service providers. Rates are declining, while investment costs are quite large, they have to race on technology, experts identify opportunities for businesses to come after almost zero.

Internet market is witnessing a fierce race among service providers. Rates are declining, while investment costs are quite large, they have to race on technology, experts identify opportunities for businesses to come after almost zero.

Picture 1 of The Internet playground is hard to have places for ISPs to come later

Internet service rates are getting cheaper and cheaper.Photo: Hoang Ha

Of the 18 enterprises licensed for Internet service business (ISP), only 9 units are operating. However, among the 9 enterprises currently operating, the main market share is in the hands of 3 "big men", VDC, FPT and Viettel, accounting for about 80% of the total market share of ISPs. The 3 units themselves are also very struggling in the process of deploying making profits from Internet connection services such as 'the cake is no longer sweet'.

An official of VNPT commented that new ISPs will face difficulties because the input cost is very high while the price of access services is decreasing. For example, in 1999, the subscription fee for VNPT's indirect access service via the public fixed telephone network of PSTN is 320,000 VND / month, the access charge is 180-250 VND / minute. After 10 consecutive drops, up to now, monthly subscription fee is still 27,272 dong / month and access fee is only 40-180 dong / minute.

For ADSL high-speed Internet access service, currently VNPT's maximum charge rate is not more than VND 1 million / month, other ISPs will have to adjust to the same or lower rates if they do not want to lose customers. line.

According to the plan of October, Vietnam will officially enter the WTO roof.The goal that the telecom industry set out when opening the market is to attract foreign partners to invest in all fields.However, in fact, the US has been allowed to join a 50/50 joint venture to develop Internet services in Vietnam, but no joint venture project has been submitted.Even the US contact with Vietnam on this issue is not much.

According to ISP's calculations, if current ADSL rates plus other costs, the supplier will no longer have profits, even losses. Meanwhile, the investment for an Internet system is quite expensive. For example, a business that wants to join this market must have a capital of about 5-10 million USD and to survive, they may have to accept losses in the first 2-3 years to find customers.

Not to mention the promising service business such as broadband will consume a lot of money to invest in infrastructure. Meanwhile, ISP licenses that the Ministry of Posts and Telematics grant later to domestic firms have relatively small capital scale of some private enterprises.

According to experts, when licensing new ISPs, it seems that the Ministry of Posts and Telematics has not mentioned much about financial capacity and human resources, so many businesses have applied for that license because they cannot afford to develop. declaration. Therefore, the new ISPs are really hard to 'live' because they do not find the strength to compete with old ISPs, in other words, there is no 'door' for new businesses.

Wrestling with the number of losses - interest

Not only new businesses are headache with the market entry plan but also other businesses participating in the market are headache with the problem of loss - profit. At the end of 2004, Kasati Corporation tested some Internet-based application services (OSP) with "super cheap" rates. They even plan to launch a device that can help people without computers to connect and make cheap Internet calls. But after two years, this supplier has not made any move because he has not seen the profit yet and one reason is hard to say that they are "not enough capital". Kasati representative said that the company is still calculating to find a service suitable for the business model. " However, with the current growth rate, we really have no opportunity to develop, " he said.

Even with Saigon Postel Company, after more than 5 years of implementation, they have just provided ADSL services in Phu My Hung new urban area and are deploying to customers on their fixed network but cannot provide Massively, because they still have to compensate for both dial and ADSL services.

Not being compensated for losses like Saigon Postel, but NetNam Company just tiptoe to provide ADSL services to customers who are organizations and agencies, but cannot provide wide range of Internet agents because customers will occupy bandwidth. great international. NetNam Director Tran Ba ​​Thai said that in order to survive and not suffer losses, the company had to transfer all business sources. NetNam's revenue does not rely on Internet services business, but it also makes network solutions.

Hong Anh

Update 13 December 2018
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