Viettel deputy MD shares strategy for becoming top-10 global player

Viettel reveals strategy for becoming top 10 global player

29 JUN 2015

Vietnam’s Viettel Group has had a busy year. It has expanded into four new markets – including three in Africa — acquired a smaller player in Cambodia and is now the market leader in five countries. But that’s just the start of its aggressive global expansion strategy, which will see it move into four new markets each year, said Le Dang Dung, the company’s deputy managing director, in an interview with Mobile World Live.

Viettel, which is run by the military, claims to serve more than 76 million subscribers in 10 countries in Asia, Africa and the Americas. Its overseas revenue hit $1.2 billion last year and continues to grow by more than 20 per cent annually, Dung (pictured) said.

Besides controlling 47 per cent of its home market, the operator is now the largest mobile player in Cambodia (Metfone Viettel), Laos (Unitel), Haiti (Natcom) and Mozambique (Movitel), he added.

Earlier in the year the company announced ambitious plans to expand into 30 to 35 countries and become one of the world’s top 10 telecoms firms within five years.

Its expansion strategy is quite straightforward: “We have set a goal to obtain investment licences in two new markets and to launch services in two additional new markets every year. Our aim is also to continue our growth momentum by introducing new solutions to reinforce our market leading position in the core markets where we are present,” he said.

M&A
As part of its global expansion plan, he said it is targeting investing in operators that are among the top three players in a market.

The Viettel veteran noted that in highly saturated markets, where the availability of spectrum licences is low, it looks for a stake in an operating company or to acquire the whole company. In markets where the government has policies to attract telecoms investments, it will look to bid for licences. “Our decision to invest will be subject to the telecoms development policies and regulations of each country.”

Last year Viettel moved into East Timor and achieved 96 per cent population coverage after only one year and expanded the subscriber base to nearly 500,000. Last December it launched service in Cameroon, under the Nexttel brand and added one million subscribers within four months. Dung said Viettel was the first operator in this country to deploy 3G technology.

Its subsidiary in Cambodia, Metfone, took over fourth ranked Beeline in March, giving the merged company almost 13 million mobile connections and consolidated its leadership position, with a 53 per cent market share.

In Tanzania it is rolling out its infrastructure and expects to launch in the second half of the year, and Viettel Burundi, under the Lumitel brand, has started providing service and has signed up more than 600,000 subscribers in one month.

The company has also expressed interest in fast-growing Myanmar, which has a population of about 60 million and low mobile penetration compared to the rest of Southeast Asia. It announced plans last December to invest $800 million to set up operations there but has yet to name its local partner. Dung said it is “accelerating the investment process and putting in place the financial resources and talent to quickly capture the opportunity. Announcement details will be shared as soon as available”.

Moving beyond 3G
In its home market, where Viettel has about 55 million active subscribers, one third of customers already have smartphones. It plans to double the percentage of 3G subscribers to 50 per cent of its total user base by the end of next year.

With more than 32,000 3G base stations, its 3G network covers 98 per cent of the population.

“While Vietnam’s adoption of 4G is slightly slower than the rest of the world, we are ensuring that our network and business plans are ready to provide 4G services as soon as the approval and frequency licence from the Ministry of Information and Communications come through. We expect Viettel’s 4G coverage will be nationwide within six months of being in operation.”

He said one of the biggest opportunities in Vietnam is the fast growing broadband data market. The government has set a target of achieving seven million broadband subscribers by the end of the year and 19 million by 2020. “To boost revenue growth and ARPU, we will expand the range of our core services.”

Facing the challenge of changing business models and increasing competition from OTT service providers, Dung said Viettel is partnering with OTT and content services providers on a revenue sharing basis. It also provides 3G-integrated electricity metering devices that allow it to measure electricity consumption, capacity and voltage, and collect payments.

Noting the popularity of network sharing among mobile operators, he said Viettel is currently sharing infrastructure, including fibre and truss pillars, in certain markets and will consider additional sharing when other markets mature, subject to the regulations and policies of the hosting governments.

Pointing to the diversity of its revenue base, Dung said a major source of sales comes from the delivery of software products, such as network and enterprise management software.

Author

Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

Read more

Related

Tags