Vietnam Ict Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Vietnam Ict Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The revenue from the Vietnamese ICT market is anticipated to record a CAGR of 7.8% over the next coming years. Global leaders like Microsoft, Qualcomm, Cisco Systems, IBM, and Dell Technologies dominate the Vietnam ICT market. The ICT market across the country is growing rapidly due to strong spending on hardware and software services.

• The public and private sectors have increased their adoption of ICT solutions. The government of Vietnam has identified ICT as a major industry and socioeconomic growth driver to apply advanced ICT solutions toward improving operational efficiencies and providing better governance services. For instance, Samsung Vietnam announced the construction of a new research and development (R&D) center in Vietnam by the end of this year, worth USD 220 million.
• The Vietnamese government has taken several initiatives to bring new developments to the country. According to the e-Conomy Southeast Asia report 2021, Vietnam’s digital economy is forecast to reach USD 50 billion by 2025. Digital transformation is creating new growth opportunities for the ICT market.
• Teh country is expected to continue importing the bulk of ICT hardware, software, and services. For instance, the Government of Vietnam approved the National Digital Transformation Program through 2025, with the vision to 2030, which will further support the growth of the ICT market.
• For instance, according to World Bank data, Vietnam's digital economy is growing at 10% per year. It could reach more than USD 200 billion by 2045. Since the digital economy is growing and will create new growth opportunities for the Vietnam ICT market.
• For instance, the government issued a national strategy on the research and development application for AI until 2030, aiming to gradually turn the country into an innovation and AI hub in ASEAN and the world. Such government investments would help start-up companies to offer ICT solutions in the market.
• During the COVID-19 pandemic, people opted the work-from-home mode and spent more time watching videos, and games, more than ever; internet penetration increased, and there was a demand for data competition. To overcome such instances, JLL received many requests to rent land or lease buildings to construct and develop Tier-3 or Tier-4 data centers in Vietnam. Such initiatives will further create new growth opportunities for the ICT market.

• There has been an increasing demand for cloud computing technology in recent years since cloud solutions providers have several benefits and exposed data hosted to severe risks such as privacy and identity theft. For instance, the Ministry of Information and Communications (MIC) aims to expand the market share covered by domestic CSPs (cloud service providers) to 70% in 2030 as part of national goals for digitalization.
• There has been a rapid increase in investment by the government and large corporations in core technology areas such as Artificial Intelligence (AI), cloud computing, and many more technologies. For instance, the Vietnam International Bank (VIB) signed a three-year strategic partnership with Microsoft Azure to deploy multi-cloud on Microsoft Azure premise that will further increase the growth of the cloud computing market.
• The cloud service market of the country is fragmented in nature, with the presence of a mixture of foreign as well as domestic players. For instance, Viettel and Nvidia signed a strategic partnership agreement to research and develop artificial intelligence. Vietnam is strongly committed to investing in AI as per the national strategy for developing and utilizing AI by 2030.
• Increasing investment in infrastructural development projects would create new growth opportunities for the ICT market. For instance, Viettel Cloud has 13 data centers in Vietnam. Further, in 2025, Viettel Cloud plans to invest over USD 400 million to expand the scale to 17.000 racks. Following the roadmap, in 2030, the total investment would reach USD 1.6 billion, with 34.000 racks meeting international standards.
• According to Do Ventures, in 2021, there were 165 investment deals in tech startups in Vietnam. The value of capital investments in tech startups reached USD 1.4 billion in 2021. Such investments will further increase the demand for the software and services market.

• According to Vietnam’s Ministry of Information and Communications, Vietnam had roughly 125 million mobile phone subscribers as of February 2021, and a penetration rate increased significantly to 129%. Increased smartphone device penetration and rising demand for high-speed data connectivity are some of the factors driving the growth of the Vietnam Telecom market over the next five years.
• Expanding network infrastructure, including fixed and wireless broadband, is a longer-term supporting trend for ITC market growth. For instance, Casa Systems signed a memorandum of understanding (MoU) with Vietnam Posts and Telecommunications Group (VNPT) to introduce next-generation 5G technologies, such as including 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 100% of communal-level localities. The 2G, 3G, and 4G mobile networks have covered 99.8% 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.
• In addition, the government has forward-looking plans to expand its network coverage from 3G and 4G to 5G networks. For instance, 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.
• According to the Ookla Speedtest Global Index, Vietnam ranked 47th with a median fixed broadband download speed of 78.87 Mbps in October 2022. Internet user penetration is growing significantly and thus increasing the demand for fixed broadband services.

The Vietnamese ICT market is at a fragmented stage as the market consists of many players currently. Several key players in the ICT market are in constant efforts to bring advancements. A few prominent companies are entering into collaborations and expanding their footprints in developing regions to consolidate their positions in the market. The major players are Microsoft, Qualcomm, Cisco Systems, IBM, Dell Technologies, and many others.

In June 2022, Softline Vietnam won the 2022 Microsoft Partner of the Year Award. The company was honored for demonstrating excellence in innovation and implementing customer solutions based on Microsoft technology.

In May 2022, Viettel Group partnered with Qualcomm Technologies Inc. to develop a next-generation 5G Radio Unit (RU) with massive MIMO capabilities and distributed units (DUs). This collaboration aims to roll out 5G network infrastructure and services in Vietnam and globally.

• The market estimate (ME) sheet in Excel format
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