In Business Model, Internet Access, Mobile, Spectrum

Mobile networks run in generations roughly 10 years in length. That can cause problems whenever a country, or a service provider, faces a choice of upgrading to the next generation before the present generation has been fully adopted.

For some service providers, the challenge is tougher: upgrade to the sequentially next generation (2G to 3G, for example) or jump all the way from 2G to 4G.

Those issues now are faced in Vietnam, which says it will introduce fourth generation (4G) mobile networks in 2015.

In 2011 the Ministry of Information and Communications licensed five operators — FPT Telecom, VNPT, Viettel, CMC, and VTC — to test 4G services.

Viettel, MobiFone, and Vinaphone reportedly are ready to deploy, albeit with concerns about what 4G might do to the 3G business. Smartphone adoption in Vietnam in 2014 was about 23 percent.

Viettel, for example, seems to believe that 4G handsets are too expensive. More to the point, mobile service providers likely are worried about recovering investment made in 3G before moving on to 4G.

To be sure, present use of smartphones is heavily concentrated in Hanoi and Ho Chi Minh City. Overall, smartphone use lags elsewhere.

So the issue is what happens to 3G if 4G is launched.


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