Vietnam ICT Market, By Type (Hardware, Software, IT Services, Telecommunication Services), By Size of Enterprise (Small & Medium Enterprises, Large Enterprises), By Industry (BFSI, IT & Telecom, Government, Retail & E-commerce, Manufacturing, Energy & Uti

Vietnam ICT Market, By Type (Hardware, Software, IT Services, Telecommunication Services), By Size of Enterprise (Small & Medium Enterprises, Large Enterprises), By Industry (BFSI, IT & Telecom, Government, Retail & E-commerce, Manufacturing, Energy & Utilities, Others), By Region, Competition, Forecast & Opportunities, 2019-2029F

Vietnam ICT Market was valued at USD 21.11 Billion in 2023 and is expected to reach USD 36.06 Billion by 2029 with a CAGR of 9.17% during the forecast period. The ICT (Information and Communication Technology) market comprises a diverse range of industries and businesses focused on the creation, distribution, and support of technologies that enable the transmission, processing, and storage of data. This sector includes several key areas: hardware, which encompasses physical devices such as computers, servers, smartphones, and networking equipment; software, covering operating systems, applications, and cloud-based solutions; telecommunications, which involves voice, video, and data communications including internet and mobile networks; and IT services, which provide support, consulting, system integration, and managed services. This market is essential for driving digital transformation across various industries, including healthcare, education, finance, and manufacturing. As digital platforms become more integral to everyday operations, there is a growing need for advanced connectivity solutions like 5G networks, cloud computing, cybersecurity measures, and data analytics. The rapid expansion of the ICT market is also fueled by innovations in artificial intelligence, the Internet of Things (IoT), and blockchain technology. As businesses and individuals increasingly adopt digital solutions to enhance efficiency, communication, and decision-making, the ICT market remains a vital component of the modern global economy. It is characterized by intense competition, rapid evolution, and a central role in technological progress worldwide.

Key Market Drivers

Government Support and Policies

One of the key drivers of the Vietnam ICT market is the strong support and policies initiated by the Vietnamese government. Over the past decade, the government has made significant efforts to promote digital transformation and foster growth in the ICT sector as part of its overall strategy to become a high-income, industrialized nation. The government’s "National Digital Transformation Program by 2025, with a Vision to 2030" is one of the primary initiatives aimed at integrating digital technologies across various industries, boosting the digital economy, and creating a conducive environment for ICT development.

Government policies in Vietnam focus on developing a skilled workforce, attracting foreign investment, and encouraging innovation in areas such as cloud computing, artificial intelligence (AI), and blockchain. To build a robust ICT infrastructure, the government has also been investing in digital infrastructure, such as broadband networks, 5G technology, and data centers. Initiatives like these have allowed Vietnam to position itself as a competitive player in the regional and global ICT market.

The Vietnamese government has been actively working on improving its regulatory framework to support startups and tech companies. The establishment of several technology parks and innovation hubs throughout the country has provided opportunities for entrepreneurs to access funding and resources. Furthermore, tax incentives and other benefits are offered to both domestic and foreign investors in the ICT sector, promoting capital inflows and the growth of high-tech industries.

Growing Demand for Digital Services

The increasing demand for digital services is another major driver of Vietnam's ICT market. As the country’s economy continues to modernize and digitalize, more businesses, governments, and consumers are adopting ICT solutions for everyday operations. This demand is particularly strong in areas such as e-commerce, financial technology (FinTech), and online entertainment, all of which have witnessed significant growth over the past few years.

The rise of e-commerce in Vietnam is one of the clearest examples of this trend. With a growing middle class, increased internet penetration, and the expansion of mobile services, online shopping has become a norm for many Vietnamese consumers. Platforms like Shopee, Lazada, and Tiki are experiencing exponential growth, creating a need for more advanced ICT infrastructure to handle the demand. This is fueling investment in technologies such as cloud computing, data analytics, and cybersecurity.

FinTech is also a rapidly growing sector in Vietnam. Digital payments, online banking, and mobile wallets are gaining popularity, especially as consumers seek more convenience and businesses embrace digital financial solutions. The demand for secure, efficient, and reliable digital payment systems is driving innovation and development within the ICT market, encouraging the growth of tech startups and pushing traditional financial institutions to upgrade their services.

Online entertainment, particularly streaming services, gaming, and social media is yet another area contributing to the growing demand for digital services. Vietnam’s young and tech-savvy population is increasingly turning to digital platforms for leisure activities, necessitating more robust and scalable ICT infrastructure.

Rapid Urbanization and a Young, Tech-Savvy Population

Vietnam’s rapid urbanization and its young, tech-savvy population are crucial factors driving the growth of the ICT market. As more of the population migrates to urban centers, the demand for modern digital infrastructure, efficient communication networks, and advanced technologies increases. Cities like Ho Chi Minh City and Hanoi are becoming digital hubs where tech companies, startups, and entrepreneurs thrive.

Vietnam’s demographic profile is a major asset for the ICT sector. Over 60% of the population is under the age of 35, and this young population is particularly adept at adopting new technologies. With the rise of affordable smartphones and internet access, young Vietnamese are increasingly reliant on digital tools for communication, shopping, entertainment, and education. This population segment is also more open to experimenting with new technology trends like mobile apps, gaming platforms, and digital payments, further fueling demand in the ICT market. Additionally, urbanization has led to an increased concentration of tech companies and talent in cities, creating innovation clusters. These urban centers serve as fertile grounds for startups and established tech firms alike, benefiting from access to skilled workers, better infrastructure, and business networks. As the demand for high-speed internet, mobile connectivity, and digital services in urban areas continues to grow, the ICT market expands in parallel.

In short, Vietnam’s urbanization, coupled with its young and tech-driven population, forms a powerful driver behind the ICT market, as these factors combine to create a highly dynamic and innovative environment.

Key Market Challenges

Lack of Skilled Workforce

One of the most significant challenges facing Vietnam's ICT market is the shortage of a highly skilled workforce. Although Vietnam boasts a young, tech-savvy population, the country still struggles with a mismatch between the skills required by the rapidly evolving ICT industry and the current capabilities of its workforce. This skills gap is particularly evident in specialized areas like artificial intelligence (AI), cybersecurity, cloud computing, data analytics, and software development. The shortage of skilled professionals in these fields hampers the country’s ability to innovate and meet the increasing demand for advanced digital services.

The educational system in Vietnam is another contributing factor to this challenge. While universities and vocational schools are producing graduates with degrees in IT and computer science, many of these programs lack a focus on practical, hands-on experience that is critical for success in the fast-paced ICT sector. As a result, companies often find that new graduates lack the technical expertise and problem-solving skills needed to thrive in the industry. This forces many businesses to spend considerable resources on additional training for their employees, which can delay project timelines and increase costs.

Another factor contributing to the skills gap is the competition for talent from global markets. As Vietnam becomes more integrated into the global economy, skilled Vietnamese ICT professionals are being attracted by higher-paying jobs abroad, particularly in countries with more mature ICT sectors. This brain drain exacerbates the already limited talent pool within the country, making it even harder for local companies to find the expertise they need to remain competitive.

Addressing this challenge requires collaboration between the government, educational institutions, and the private sector. The government has recognized the need to improve the quality of education and vocational training to align with industry needs. Initiatives aimed at promoting STEM (Science, Technology, Engineering, and Mathematics) education, along with partnerships between universities and tech companies, are steps in the right direction. However, more comprehensive reforms are needed to develop a highly skilled, adaptable workforce capable of supporting Vietnam's growing ICT market.

Cybersecurity Threats and Data Privacy Concerns

As Vietnam's ICT market continues to expand and digital adoption accelerates across sectors, cybersecurity threats and data privacy concerns are becoming critical challenges. With the increasing reliance on digital platforms, e-commerce, mobile payments, and cloud-based services, both businesses and consumers are more vulnerable to cyberattacks. This rise in digital activity has made Vietnam a target for cybercriminals, leading to growing concerns over the security of sensitive information and the protection of personal data.

One of the main challenges is that Vietnam’s cybersecurity infrastructure and regulations are still in the process of catching up with its rapid digital growth. Many businesses, particularly small and medium-sized enterprises (SMEs), lack the resources to invest in robust cybersecurity measures. This makes them particularly vulnerable to cyber threats such as ransomware attacks, phishing schemes, and data breaches. The lack of a comprehensive security culture within organizations further exacerbates this issue, with many employees lacking the awareness or training needed to identify and mitigate potential threats.

At the national level, while the government has implemented laws such as the Law on Cybersecurity (enacted in 2019), enforcement remains a challenge. Compliance with data protection regulations is often inconsistent, and many businesses struggle to keep up with the evolving legal landscape. Additionally, Vietnam's rapidly growing digital economy creates an ever-expanding attack surface, making it difficult for regulators to keep pace with the changing cybersecurity environment.

Another concern is the rise in data privacy issues. With the proliferation of online services and the increasing amount of personal data being collected by businesses, ensuring that this data is adequately protected has become a critical issue. There are ongoing concerns about how companies handle sensitive customer information, with many users expressing distrust over how their data is collected, stored, and used. High-profile data breaches and incidents of personal information being leaked have heightened these concerns, leading to calls for stronger data protection measures.

To address these challenges, Vietnam needs to invest heavily in strengthening its cybersecurity infrastructure and fostering a culture of digital security awareness. Companies must prioritize cybersecurity as a fundamental component of their operations, and the government should work on enhancing enforcement and ensuring businesses comply with regulations. Only by addressing these issues can Vietnam’s ICT market continue to grow while maintaining trust and security in the digital economy.

Key Market Trends

Rise of E-commerce and Digital Payments

One of the most prominent trends shaping the Vietnam ICT market is the rapid rise of e-commerce and digital payments. With increasing internet penetration, affordable smartphones, and a growing middle class, online shopping has gained significant traction across the country. Vietnam’s e-commerce sector has seen exponential growth over the past few years, becoming one of the fastest-growing markets in Southeast Asia. Platforms such as Shopee, Lazada, and Tiki dominate the landscape, offering a wide range of products, from fashion and electronics to groceries and household items.

As e-commerce flourishes, the demand for efficient and secure digital payment solutions has also surged. The Vietnamese government has set a goal to move toward a cashless economy, and digital payment methods such as mobile wallets, QR code payments, and online banking are becoming increasingly popular. FinTech solutions like MoMo, ZaloPay, and VNPay have gained significant market share, providing consumers with convenient, secure, and accessible payment options.

This trend is being further accelerated by changing consumer behavior, particularly in the wake of the COVID-19 pandemic, which has pushed many to adopt contactless payment solutions and rely more on online shopping. As more businesses move online, both the e-commerce and digital payment sectors are expected to continue growing, making them key drivers of the overall ICT market in Vietnam. Furthermore, this growth is creating opportunities for the development of new technologies and infrastructure. Cloud computing, cybersecurity solutions, and logistics technologies are in high demand as companies strive to improve their digital capabilities and meet consumer expectations. As Vietnam continues to modernize and move toward digitalization, e-commerce and digital payments will remain at the forefront of the country's ICT market trends.

Expansion of 5G and Next-Generation Connectivity

The expansion of 5G and next-generation connectivity is another key trend driving the growth of Vietnam’s ICT market. As one of the most transformative technologies, 5G has the potential to revolutionize industries by enabling faster internet speeds, lower latency, and more reliable connectivity. In Vietnam, the government and major telecom operators have been actively investing in the deployment of 5G networks as part of the country’s digital transformation agenda.

Telecom companies such as Viettel, VNPT, and MobiFone have already launched 5G pilot programs in major cities like Hanoi and Ho Chi Minh City, with full-scale commercial rollout expected in the coming years. The introduction of 5G is not only about enhancing mobile internet speeds for consumers but also about enabling the development of new technologies such as the Internet of Things (IoT), smart cities, and autonomous vehicles.

5G’s high-speed connectivity is expected to drive innovation in areas such as healthcare, education, and manufacturing by enabling the use of technologies like remote monitoring, telemedicine, and industrial automation. For instance, in smart cities, 5G can facilitate real-time data collection and analysis, improving urban management, traffic control, and energy efficiency. Moreover, 5G will accelerate the growth of other digital services such as cloud computing, virtual and augmented reality (VR/AR), and artificial intelligence (AI). These technologies rely on ultra-fast, low-latency networks, and 5G provides the necessary infrastructure to support their widespread adoption.

As Vietnam continues to deploy 5G networks, businesses and consumers alike will benefit from enhanced connectivity and new digital experiences. This trend will significantly impact the ICT market, driving further investment and innovation in technology and telecommunications.

Segmental Insights

Type Insights

The Telecommunication Services held the largest market share in 2023. Telecommunication services dominated the Vietnam ICT market due to several key factors that have shaped the country’s digital landscape. One of the primary drivers is the rapid growth of mobile and internet connectivity. With a population of over 98 million people, Vietnam has one of the highest mobile penetration rates in Southeast Asia, with most citizens using mobile devices as their primary means of accessing the internet. This widespread adoption has fueled the demand for telecom services, particularly mobile data and broadband services.

The Vietnamese government has also played a pivotal role in promoting the development of telecommunications infrastructure. Major investments in expanding 4G networks, and the ongoing deployment of 5G technology, have enhanced connectivity across urban and rural areas. Leading telecom operators like Viettel, VNPT, and MobiFone have been at the forefront of this expansion, investing heavily in infrastructure to meet the growing demand for high-speed internet and mobile services. The early adoption of 5G in major cities like Hanoi and Ho Chi Minh City positions Vietnam as a leader in next-generation connectivity in the region. The telecommunication sector has benefited from Vietnam’s increasing urbanization and digital transformation initiatives. As businesses and consumers shift toward digital services, the need for reliable, fast, and affordable telecommunication services continues to grow. Telecom services also support the development of other key ICT sectors, including e-commerce, cloud computing, and IoT, making them a foundational component of Vietnam’s digital economy.

Regional Insights

Southern Vietnam held the largest market share in 2023. Ho Chi Minh City, the largest city in Vietnam, serves as the economic powerhouse of the country. It is home to numerous multinational corporations, technology firms, and startups, creating a vibrant business ecosystem. The city’s robust infrastructure, including modern office spaces, advanced transportation networks, and high-speed internet connectivity, provides an ideal environment for ICT businesses to thrive.

Southern Vietnam attracts substantial foreign direct investment (FDI), particularly in the ICT sector. International tech giants like Intel, Samsung, and LG have established significant operations in the region, drawn by its favorable business climate, skilled workforce, and strategic location. This influx of investment not only boosts the local ICT industry but also spurs innovation and technological advancement.

The region benefits from a large pool of skilled professionals and graduates from leading universities and technical institutions. Ho Chi Minh City, with its concentration of educational and training institutions, produces a steady stream of IT and engineering talent, essential for supporting and advancing the ICT sector.

The local government has implemented various initiatives to support the growth of the ICT industry in Southern Vietnam. This includes the development of technology parks and innovation hubs, such as Saigon Hi-Tech Park, which provide resources, networking opportunities, and incentives for tech companies. The region’s infrastructure investments, including improvements in broadband and 5G networks, further bolster its position as the ICT hub of the country.

Key Market Players

• Microsoft Corporation
• Apple Inc.
• Amazon Web Services, Inc.
• Alphabet Inc.
• IBM Corporation
• Intel Corporation
• Cisco Systems, Inc.
• Oracle Corporation
• SAP SE
• Hewlett Packard Enterprise Company

Report Scope:

In this report, the Vietnam ICT Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

· Vietnam ICT Market, By Type:

• Hardware
• Software
• IT Services
• Telecommunication Services

· Vietnam ICT Market, By Size of Enterprise:

• Small & Medium Enterprises
• Large Enterprises

· Vietnam ICT Market, By Industry:

• BFSI
• IT & Telecom
• Government
• Retail & E-commerce
• Manufacturing
• Energy & Utilities
• Others

· Vietnam ICT Market, By Region:

• Southern Vietnam
• Northern Vietnam
• Central Vietnam

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Vietnam ICT Market.

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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