Vietnamese set-top box manufacturers wants the state to order

Set-top box manufacturers in Vietnam wants the state to order

Vietnamese manufacturers are technically capable of making set-top boxes, which satisfies the requirements set by the Ministry of Information and Communication. However, Hanel, Digilink and VTV Broadcom would not dare to make products in large quantities, as they would obviously be less price competitive than the Chinese.

Therefore, the manufactures suggested it would be better to make Set-top boxes to State orders. If the State places orders with manufacturers and then give the Set-top boxes to the households lacking sufficient funding, this would benefit all involved parties. The manufacturers could be sure about the sale, while the State can buy Set-top boxes at reasonable prices, and the implementation of the TV digitalization plan could be completed.

Tran Viet Thanh, Deputy Minister of Science and Technology, confirmed that the tax incentives offered to the Set-top box manufacturers would not help Vietnamese products, become price competitive with the Chinese boxes, but would only help compete in quality.

The State will give financial support to households lacking sufficient funding, to help them buy set-top boxes, as a part of the implementation plan. The selling prices would be about $35 for DVB-T2 standard boxes and $38 for DVB-S2 boxes.

A senior executive of VTV said set-top box manufacturers would face high risk in the first phase of the TV digitalization plan the set-top box market would be very small. Therefore, no manufacturer would dare to organize large-scale productions.

Nguyen Hoang Phong from Digilink affirmed that no one would venture to make products if they are not sure about the market scale and about the state’s policies.

While Vietnamese manufacturers are still busy negotiating with the State about the production plans, Chinese set-top boxes have been flooding the domestic market. Chinese DVB-T2 with APH, Quisheng brands are selling at $28-$33. However, the quality has not been recognized as meeting the Vietnamese standard.

According to the Vietnam’s Information and Communication Strategic Institute, 8 million households out of the 22.3 million, use pay-tv and terrestrial digital TV (DVB-T standard, broadcasted by VTC).

In the Ministry of Information and Communications regulation, it states that, from 1 April 2014, all televisions over 32 inches using LCD, PDP, OLED will have to integrate DVB-T2 receivers meeting the DVB-T2 standard and from January 4, 2015, all TVs with screen size below 32 inch have to have integrate DVB-T2 receivers.

The Vietnamese TV digitalization plan is carried out in four phases with four groups of provinces and cities.

  • In the first phase, the plan would be carried out in five central cities and provinces, including Hanoi, Ho Chi Minh City, Hai Phong, Da Nang, Can Tho. The switching to the terrestrial digital TV would be ready prior to December 31, 2015.
  • The second phase involves 26 provinces. Deadline is December 31, 2016.
  • The third phase will be implemented in 18 provinces by December 31, 2018.
  • The fourth phase, implementation in remote provinces in the north and central region.
Author: Allan Rasmussen
Managing director at Yozzo. Allan’s expertise includes the development and execution of growth strategies, market insights, trends and opportunities, new business models and strategies
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