The government’s Decision 80/2014/QD-TTg on piloting information technology outsourcing (ITO) within the public sector, which took effect on February 15, is expected to stimulate a market ripe with potential.

Taking advantage of outsourcing, State-run agencies and companies can remove the need for large investments in high-tech facilities by spending on their specific needs, the Saigon Times Online quoted Le Quoc Cuong, Vice Director of the Ho Chi Minh City Department of Information and Communications.

As from a business perspective, Vo Van Khang, Vice Chairman of the Modernisation Committee at Eximbank, stated that hiring outside labour does not always lower costs but that many businesses willingly accept higher prices in favour of improved competitiveness, rapid product launches or outstanding service quality.

Outsourcing is particularly relevant for professional and short-term services, Khang declared.

Some Vietnamese enterprises have thus far outsourced popular IT services such as internet hosting services, digital marketing, software design, and system management, but the use of the service is still relatively limited.

In previous years, IT service providers were tasked only with installing computer systems without continued management or maintenance, but that status quo is shifting.

In the context of nationwide official procedure reform with targets for a future electronic government, ITO is in great demand, as it saves time, overcomes a lack of resources, reduces costs and produces professional quality.

According to Do Cao Bao, CEO at FPT Information System, IT companies in Vietnam provide three main services: system management, cloud software leasing and maintenance services. Maintenance services is the largest component, earning 4-5 trillion VND (168-233 million USD) per year.

Local giants, such as FPT Corporation, Viettel and VNPT, have already joined in. Preparing for the future wave of ITO demand, those companies have prioritised expanding their human and financial resources.

Decision 80/2014/QD-TTg reflects the Government’s efforts to boost public sector performance and provide additional opportunities for other sectors in the market.

To be effective and practical, the decision requires associated official guidance on payments, standards and technical specifications of IT services, among others. Regulations concerning foreign factors in ITO are also needed.-VNA