Vietnam’s Migration to 3G

3G is Third Generation networking technology that empowers smart devices (generally hand-held devices such as Smart phones and PDAs) to work on internet (online) technology, taking such device communications into real time.

Most countries are implementing this technology in phases, and countries like the US and some on the European continent are reaping the bounties that seamless communications offer for business as well as social life.

Initially sluggish 3G is the mobile technology in US and Europe today

Powered by intuitive software (apps), these devices and 3G technology today allow access to the internet, multimedia and video viewing, and most functional capabilities common to a laptop or iPad. Its power and reach has already been proven in the US and in parts of Europe, where Smartphones are fast shifting the paradigms of communication in the business and social realms.

Vietnam’s story of 3G adoption

The first instances of 3G capabilities were showcased in 2001 in Japan. It was launched in Vietnam in 2009 and saw the subscriber base rise from three percent to eleven percent by the end of that year.

This matches the statistics,following a study by The Nielsen Company, of 3G migration in most countries:

• In the US, where the mobile penetration is 99%, 3G is 72%
• Malaysia boasts a mobile penetration of 114%, with 3G penetration at 22%
• Indonesian figures show 84% mobile penetration and 14% 3G penetration
• In Vietnam, mobile penetration is 126% and 3G penetration is 11%

The study categorizes Vietnam as an ‘early adapter’ to 3G, given the limited applications that they are currently applying (despite awareness of the advanced features of 3G such as mobile TV viewing, net browsing, etc.). The highest percentage (4% of Vietnamese) use it to download wallpaper, and streaming audio, in comparison to US users, where close to 37% use it for MMS and picture messaging, and a resounding 25% use it for emailing.

Lessons from Malaysia, Indonesia and Singapore

Strong promotions of Smartphones and increased access to BlackBerrys and Androids, and the flooding of Chinese handsets at less than $200, ensured the subscriber based increased in these societies. This surge came along with innovative data plan pricing that put these countries well into the 3G spectrum; there was also the adoption of various packages such as ‘data snacking,’ set prices for a particular time of use where pre-paid services dominate, and free trial plans. But perhaps what boosted the quick adoption to 3G the most are the attractive pricing plans, such as $11 for 3G in Indonesia, or the free data phones for iPhone in Singapore.

What Vietnam’s service providers need to offer for 3G Penetration

The Nielson Study puts it succinctly; Promote Smartphones, Innovate the data plans and Create the market for youth to use. While the first two points are regular market strategies, the third will involve educating parents through popular media (HBO, ZingMe) and 3G information. The pricing of the mobile phones and the quality of the network has to be superior for retaining the finicky consumer base. The key is to find the right sponsors to subsidize cost of promotions like service discounts, English video tutorials or the latest Korean soaps.

The Key to Vietnam’s migration to 3G is capturing its youth. Innovative 3G Network service providers will be the ultimate winners of the 3G spectrum in Vietnam.