Small mobile network providers such as EVN Telecom and S-Fone have recently found it hard to seek strategic investors.
Insiders say, because the Vietnamese market is at a saturation point inattracting new subscribers with the domination of the three "big guys"VinaPhone, MobiFone and Viettel, only a small piece of the market cakehas been left for small providers. Another reason is that the investorshave seen the difficulties in reviving small mobile networks such asS-Fone and EVNTelecom.
In the case of S-Fone or S-Telecom,the first CDMA mobile phone service provider in Vietnam, although italready has approval for changing its business model into a jointventure, no investors have shown interest.
S-Fone wasestablished on the basis of capital contribution from Saigon Post andTelecommunication Services Joint Stock Co (SPT) and Korean SK Telecom.But
at present, SK Telecom has withdrawn capital in the joint venture by transferring its 12 percent holdings to the SPT.
SK Telecom, the mobile network provider which accounts for 50 percentof total market share in the Republic of Korea, acknowledged its failureto cooperate with S-Fone in the Vietnamese market because of the strongcompetition from domestic rivals, according to Korean telecommunicationexperts in an article from the Korea Times earlier last year.
"S-Fone is still looking for potential investors, both foreign anddomestic, who show true interest in doing business with the networkprovider," a public relations officer at S-Fone said.
"Whether S-Fone will continue its policy on pursuing CDMA (Code DivisionMultiple Access), which was considered failing in Vietnam or not isdependent on the investor who will acquire its share. So S-Fone willfirstly maintain its policy," an anonymous manager of the corporationsaid. Foreign investors have already witnessed the failure of HT Mobile,another domestic CDMA network provider.
As for EVNTelecom, an affiliate of Electricity of Vietnam, the domestic investorFinancing and Promoting Technology Corporation (FPT) has cancelled itsdecision of purchasing up to a 60 percent stake of EVN Telecom, eventhough it has already deposited over 700 billion VND (33.6 million USD)for this trade deal.
EVN Telecom has recently soughtgovernmental approval for a plan to offer a 12 percent stake to theVietnam Multimedia Corporation (VTC), according to a source fromInvestment News.
"Seeking a strategic investor was veryimportant. It would help a small network provider like EVN Telecomexpand market share, taking full advantage of partners to promote ourbusiness", Nguyen Truong Giang, manager of public relations at EVNTelecom, said.
"EVN Telecom has submitted to theGovernment its equitisation plan for approval to prepare for its findinga strategic investor"
Industry insiders said EVN Telecomwanted to retain its policy of selling shares to domestic strategicinvestors while foreign-invested telecos including Hong Kong-investedVietnamobile, the Republic of Korea's S-Fone, and Russian-investedBeeline had struggled to make a dent in the market share of majordomestic rivals like Viettel, MobiFone and Vinaphone.
"Thesmall mobile network providers not only need to find a suitablestrategic partner, but also develop their own business strategy," Ha NoiTelecom Corporation's General Director Trinh Minh Chau said./.
Insiders say, because the Vietnamese market is at a saturation point inattracting new subscribers with the domination of the three "big guys"VinaPhone, MobiFone and Viettel, only a small piece of the market cakehas been left for small providers. Another reason is that the investorshave seen the difficulties in reviving small mobile networks such asS-Fone and EVNTelecom.
In the case of S-Fone or S-Telecom,the first CDMA mobile phone service provider in Vietnam, although italready has approval for changing its business model into a jointventure, no investors have shown interest.
S-Fone wasestablished on the basis of capital contribution from Saigon Post andTelecommunication Services Joint Stock Co (SPT) and Korean SK Telecom.But
at present, SK Telecom has withdrawn capital in the joint venture by transferring its 12 percent holdings to the SPT.
SK Telecom, the mobile network provider which accounts for 50 percentof total market share in the Republic of Korea, acknowledged its failureto cooperate with S-Fone in the Vietnamese market because of the strongcompetition from domestic rivals, according to Korean telecommunicationexperts in an article from the Korea Times earlier last year.
"S-Fone is still looking for potential investors, both foreign anddomestic, who show true interest in doing business with the networkprovider," a public relations officer at S-Fone said.
"Whether S-Fone will continue its policy on pursuing CDMA (Code DivisionMultiple Access), which was considered failing in Vietnam or not isdependent on the investor who will acquire its share. So S-Fone willfirstly maintain its policy," an anonymous manager of the corporationsaid. Foreign investors have already witnessed the failure of HT Mobile,another domestic CDMA network provider.
As for EVNTelecom, an affiliate of Electricity of Vietnam, the domestic investorFinancing and Promoting Technology Corporation (FPT) has cancelled itsdecision of purchasing up to a 60 percent stake of EVN Telecom, eventhough it has already deposited over 700 billion VND (33.6 million USD)for this trade deal.
EVN Telecom has recently soughtgovernmental approval for a plan to offer a 12 percent stake to theVietnam Multimedia Corporation (VTC), according to a source fromInvestment News.
"Seeking a strategic investor was veryimportant. It would help a small network provider like EVN Telecomexpand market share, taking full advantage of partners to promote ourbusiness", Nguyen Truong Giang, manager of public relations at EVNTelecom, said.
"EVN Telecom has submitted to theGovernment its equitisation plan for approval to prepare for its findinga strategic investor"
Industry insiders said EVN Telecomwanted to retain its policy of selling shares to domestic strategicinvestors while foreign-invested telecos including Hong Kong-investedVietnamobile, the Republic of Korea's S-Fone, and Russian-investedBeeline had struggled to make a dent in the market share of majordomestic rivals like Viettel, MobiFone and Vinaphone.
"Thesmall mobile network providers not only need to find a suitablestrategic partner, but also develop their own business strategy," Ha NoiTelecom Corporation's General Director Trinh Minh Chau said./.
