The gap between
rural and urban areas in access to the Internet, especially broadband Internet service
is quite large. Broadband in Vietnam is considered saturated but in reality, saturation
occurs only in the cities and major centers. Vietnam has about 89 million people
including 72% living in rural areas and the market of potential customers has not
been fully exploited. This is a huge gap in the development of telecommunication
services including broadband Internet. Vietnam has adopted various polices in an
effort to minimize the broadband divide between urban and rural areas.
From now until
2015 and further to 2020, Vietnam will give priority to the development of broadband
in rural areas, especially to bring broadband to rural districts and poor communes.
In addition to the general policy priorities for rural broadband development, the
government also has special offers to help people in poor regions have access to
technology and help develop production and improve quality of life. Broadband can
contribute to poverty reduction, maintain social order and national security, raise
education levels and create conditions for accelerating the modernization of agriculture
and rural areas. Besides priority policies of broadband development for poor rural
regions, the government is encouraging investment in broadband for schools and public
hospitals in rural areas aimed at uniformly developing and narrowing the digital
gap between regions.
4.1 Delta and midland rural areas
Due to relative
geographical and socio-economic advantages, such as proximity to cities, economic
centers and industrial parks, Internet in the delta and midland area has developed
rapidly. The broadband network basically connects to the district level, towns and
some communes. Specific results as follows:
Most communes have an access point
providing telecommunications and Internet services for the community.
The broadband transmission
network has come to more than 84% of communes nationwide, in which:
Number of communes using
fiber optic transmission accounts for over 56%.
Number of communes using
microwave transmission accounts more than 25%.
Number of communes using
satellite transmission (VSAT DAMA, VSAT IP) accounts 3%.
of broadband services in the delta and midland areas compared to municipalities
is shown in the statistical table below.
Table 4‑1 Telecommunications services development in delta and midland areas
Broadband Internet penetration
(subscribers per 100 inhabitants)
SONG HONG (RED RIVER) DELTA REGION
The rural of Song Hong delta
Da Nang city
Ho Chi Minh city
The Southeast area
Can Tho city
Cuu Long river delta area
The rural telecommunications
market promises great potential and there should be significant competition because
broadband has developed close to saturation levels in urban areas while rural markets
are in the initial development period. On the other hand, rural areas are now developing
towards urbanization and there are many new industrial zones recently built.
Although it achieved
some initial results, rural Internet network infrastructure and quality of service
still significantly lags urban areas—Hanoi and Ho Chi Minh City account for 65%
of total broadband subscribers—and faces several challenges:
- Network capacity is
still weak and there is not a common master plan for network and technology. Except
for the mobile sector, most telecommunications services and particularly broadband
Internet in rural areas are being developed based on extended city and town networks.
- Low income and awareness
inhibits broadband affordability and capability.
4.2 Extreme poverty rural communes
Communes in remote,
border and island areas and the 62 poorest districts and communes under “Program
135” are referred to as “extreme poverty communes”. The extreme poverty communes
have common characteristics:
- Tough geographical conditions
and harsh weather;
- Difficult transportation;
- Underdeveloped infrastructure
and economic and social conditions;
- Construction and maintenance
of telecommunications infrastructure is costly and slow capital recovery and low
profitability discourages enterprises from investing in these areas.
To develop infrastructure
and universalize telecommunications and Internet services for extreme poverty communes,
the State has been supporting supply and use of services for inhabitants and enterprises
through two special programs: developing communal
access points and providing
universal telecommunication services.
4.2.1 Communal P&T and Cultural Points
had a program to develop so-called Communal P&T and Cultural Points (CPCP)*
during the period 1998 – 2007. The objectives of the
to provide telecommunications
service at the commune level;
to narrow the digital
divide between rural
and urban areas, and to promote socio-economic development.
Up to 2007, VNPT
built and put into use some 8,000 CPCPs serving 76% of the rural population, in
which 1,535 were located in extreme poverty communes (out a total of 1,644 extreme
poverty communes). In addition to postal and culture services such as books and
magazines, the CPCPs have played an important role in providing telephone, Internet
and information technology services for rural and especially for extreme poverty
areas. The CPCPs also played an important part in completing the task of bringing
telephones to 100% of communes nationwide in 2005. In 2003, VNPT started supplying
mainly dial-up Internet access to around 3,000 CPCPs at a cost of 35 billion VND
After 10 years
of operating, besides the notable achievements, the CPCPs also faced obstacles that
- Cost of operating,
repairing and upgrading
has risen due to age
of the system.
- Turnover in
some points is too low and
does not cover operating costs. Broadband
Internet has not been set up
in a large number
so quality of services is low, content is poor
and hence it is more difficult to
- Some CPCPs
built in places that are
located far from residential
areas and inconvenient for people, whereas some
are built near urban areas
socio-economic region where there is less demand
due to other options.
of the CPCP is often
low. The general
and expertise of the majority of managers is
limited and they
sometimes do not receive adequate training.
4.2.2 Universal telecommunication services program
and access goals are outlined in Decision No 74/2006/QD-TTg of the Prime Minister
and called “Program 74”.*
The public utility telecommunications area is announced annually by the Ministry
of Information and Communication, including most communes of the 62 poorest districts,
communes under Program 135, and communes in remote and island areas where teledensity
is below 2.5 subscribers per 100 inhabitants.
overall objective up to
2010 was to implement universalization
basic telecommunications services
for extreme poverty
rural residents including providing 70% of communes with a public Internet access
The Vietnam Public
Utility Telecommunication Service Fund supports the implementation of State’s policies
on provision of public utility telecommunication service throughout the whole country.
development of telecommunications network infrastructure
and public telecommunication
services access points in the form of grant assistance and preferential loans.
people to use telecommunications services in the form of reduced service charges
and VAT exemption.
After more than
four years of implementation, Program 74 has mobilized financial resources and technical
capacity of telecommunications enterprises in Vietnam to develop network infrastructure
and services for extreme poverty rural areas. Through Program 74, the State has
made a balance between rights and obligations among telecommunications enterprises
in universalization of public utility telecommunications services.
While the Program of developing the CPCPs was taken care of only by the VNPT Group,
Program 74 has the participation of major telecommunications companies such as the
VNPT Group, Viettel, EVN Telecom and the Vietnam Maritime Communication and Electronics
Company (VISHIPEL). VNPT, Viettel and EVN Telecom are ordered by the State to provide
phone and Internet services and VISHIPEL is ordered to provide public utility telecommunications
services for fishermen at sea.
74 not only provides an opportunity to access and use telecommunications services
for more than 20 million people in rural areas for economic and social development,
but this Program also supports and encourages enterprises to aggressively invest
in infrastructure networks and service development in order to provision the rural
market. Some specific results of Program 74 up to June 2010 are:
- Most people
of 4,240 communes
in the 62 poorest
districts and communes under
135, in the remote, border and islands areas with about
22 million people (accounting
for 26% of the national
population) have received benefits
from the public utility
policy of the State.
develop more than 75,623 new Internet subscribers.
- Support to maintain
the network for 275,307
- Support for 4,054 public Internet access points.
- Internet subscription
density in public utility
0.018 (late 2004) to 0.32 subscribers per 100 inhabitants (late 2009).
program has faced some difficulties
- The development
of infrastructure has not kept up with demand.
many differences in
infrastructure and subscriber density between
extreme poverty rural
and urban areas. At the end
of 2009, Internet
subscriber density in the public
was only 0.3
subscribers per 100
inhabitants (although it is nearly 18 times higher
than in 2004). Meanwhile
has 13.9 subscribers
per 100 inhabitants, Da Nang
has 8.8 subscribers
per 100 inhabitants and
Ho Chi Minh has
10.5 subscribers per 100
- The development
of infrastructure and types of services among
public utility regions
is unbalanced. Communes
Region 1 and Region 2
conditions have overheated development that exceeds
while communes in Region 3 far
from the district centers have
levels that do not meet targets.
The development of Internet subscribers
and public Internet
access points have not met targets.
- Support in
the form of preferential loans to build public telecommunication services access
points is not realistic because these areas
have difficult geographical and socio-economic conditions, low investment efficiency and
are unlikely to recover capital
so they do not encourage
Up to now there are
communes without public Internet access points,
and Internet subscriber
density is very low and does not
meet the target.
- Regarding developing
new individual and household Internet subscribers, and new public Internet access
points, only VNPT has exceeded the plan while other enterprises focused investment
in urban areas.
4.3 Future plans
119/QD-TTg on 18/01/2011 by the Prime Minister approving the project for rural communications
during the period 2011 – 2020 identifies a number of goals relating to Internet
and broadband access and services:
- 100% of communes are
connected by broadband transmission lines.
- 100% of communes having
People's Committee offices, schools and health centers are providing Internet broadband
- Internet subscriber
density in rural areas reaches 30% to 40% national average density.
- The state agency from
the district level, departments, sectors or equivalent or higher should have e-portals
or websites providing all public online services to residents and enterprises in
- The offices of the Party
and government authority from the central to commune level to have their e-mail
address for receiving and publicly responding to feedback of the people.
- The electronic information
websites of the Party, State, political and social organizations in central and
local levels have programs to receive and reply to comments of the people.