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Cable TV market to see surge wave when big guys jump on bandwagon

Update: 25-05-2012 | 00:00:00
The announcement by the big cheeses--Viettel, AVG and FPT Telecom--that they would jump into the cable TV market has stirred up the public, because the new names would be the redoubtable rivals to the familiar names such as Vietnam Cable and Hanoi Cable TV.

 AVG – FPT Telecom – the unexpected cooperation AVG and FPT Telecom have laid an application to the Ministry of Information and Communication for the permission to provide cable TV services. AVG plans to join forces with FPT Telecom to provide the services. The two partners have their own reasons to team up with each other. Since mid-2011, the two giants have built up the north-south transmission backbone. The fiber backbone is expected to have the length of 2000 kilometers and completed by June 2012. The purpose of AVG is to set up more coaxial cable to provide low cost cable TV services to households. Prior to that, AVG announced that it would provide satellite TV services at the low fees at 33,000 dong a month at the lowest. AVG is now one of the three companies allowed to build up the nationwide transmission and broadcasting system. It has also been licensed to set up an inner fixed telecommunication network and local fixed telecommunications satellite network. The cooperation between AVG and FPT Telecom in the cable TV sector is believed to have big impacts on the market. This is the cooperation of the two dynamic and competitive companies. FPT Telecom is now the second biggest Internet service provider in Vietnam. Therefore, experts have predicted that FPT Telecom and AVG would not only provide cable TV services, but they may also strive to provide “all in one” services, including Internet, high quality TV to clients’ orders, and fixed telephone services on the same coaxial cable. The move by AVG shows that AVG is trying to penetrate deeply into the telecom market, and it would not be satisfactory with just the transmission and broadcasting services. Prior to that, experts had predicted that with the resources licensed to AVG, the big guy would even eye the mobile phone market. Cable TV services always require heavy investment in infrastructure and high costs on maintenance. Therefore, to date, service providers (3-4) have just been focusing on two most lucrative markets of Hanoi and HCM City. Meanwhile, in other areas, the competition is weak with just the existence of the Vietnam Cable TV. Vietnam is considered a lucrative cable TV market with 20 million households. Viettel bets on cable TV In early 2012, Viettel stated that it would jump into the pay-TV market. One of the reasons behind the decision is that the mobile service market has got saturated, where Viettel cannot see more opportunities to increase their turnover. Meanwhile, cable TV proves to be a good choice which would help Viettel expand its market and increase the turnover. Viettel’s Deputy General Director Nguyen Manh Hung said there are about 4.5 million pay-TV subscribers (sattelie, IPTV, cable), which shows that the density of pay-TV subscribers in Vietnam is relatively low in comparison with other countries. Hung said that 3G mobile networks have reached out to 95 percent of the total population. However, as 3G is a wireless technology, the bandwidth is limited. Therefore, if Vietnam wants to have a broadband infrastructure with large coverage, it should think of another solution – cable TV.

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