Market Trends of Vietnam ICT Industry
Increasing Investment on Key Technologies (Cloud Technology and Artificial Intelligence) is Expected to Drives the Market
- There has been an increasing demand for cloud computing technology in recent years because cloud solutions providers offer several benefits but also expose hosted data to severe risks such as privacy and identity theft. For instance, as part of national goals for digitalization, the Ministry of Information and Communications (MIC) aims to expand the market share covered by domestic CSPs (cloud service providers) to 70 percent by 2030.
- The government and large corporations have invested heavily in core technology areas, such as artificial intelligence (AI) and cloud computing. For instance, the Vietnam International Bank (VIB) signed a three-year strategic partnership with Microsoft Azure to deploy multi-cloud on the Microsoft Azure premise, which will further increase the growth of the cloud computing market.
- Additionally, growing investments in advanced technologies, coupled with growth in funding to innovative startups, further drive the development of the market. For instance, according to the OCED data, as of March 2023, OKXE Inc. was the leading Artificial Intelligence (AI) startup in Vietnam, with a capital investment value of USD 15 million, followed by Edmicro Education Co., Ltd. with a total capital investment value of USD 6 million.
- Increasing investment in infrastructural development projects would create new growth opportunities for the ICT market. Viettel Cloud, for example, has 13 data centers in Vietnam and plans to invest over USD 400 million to expand the scale to 17,000 racks by 2025. Following the roadmap, in 2030, the total investment would reach USD 1.6 billion, with 34,000 racks meeting international standards.
- According to a report published by Google, Vietnam has a thriving startup scene, with a rapidly growing number of innovative startups emerging in various sectors, such as e-commerce and fintech. Vietnam is predicted to achieve the highest growth of 31% in the digital economy in Southeast Asia between 2022 and 2025.
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IT and Telecom Industry Vertical Segment is Expected to Hold Significant Market Share
- The IT and Telecom sector in the country has been thriving rapidly in the past few years. According to the 2023 GSMA Mobile Economy, The government of Vietnam is also aiming to upgrade mobile infrastructure and make 5G universal by 2030, offering new services and improved networks. The online population in the country is also increasing. According to PPRO, In 2022, the online population in Vietnam amounted to 70.9 million.
- Expanding network infrastructure, including fixed and wireless broadband, is a longer-term supporting trend for ITC market growth. For instance, in May 2022, Casa Systems signed a memorandum of understanding (MoU) with Vietnam Posts and Telecommunications Group (VNPT) to introduce next-generation 5G technologies, such as cloud-native 5G Core, RAN, and fixed wireless access (FWA) solutions in Vietnam.
- According to the MIC's Authority of Telecommunications, telecoms network infrastructure has been expanded to cover 100 percent of communal-level localities. The 2G, 3G, and 4G mobile networks have covered 99.8 percent of the population, while 5G has been piloted in 16 provinces and cities. Such initiatives from the government would create new growth opportunities for telecom service providers.
- Furthermore, the government has plans to expand its network coverage from 3G and 4G to 5G networks. For example, the Ministry of Information and Communications (MIC) has reported that it has finished installing 5G stations using open radio access network (ORAN) technology, with download and upload speeds of 900 Mbps and 60 Mbps, respectively.
