Big telecom groups meet with barriers on the way to obtain cable TV licenses

The Hanoitimes -  Some telecom conglomerates have revealed their plans to jump into the pay-TV market. They might not anticipate the barriers they would meet when implementing the plan.

The Vietnam National Television (VTV), the Vietnam Pay-TV Association, VCTV, SCTV all have unanimously lodged petition to the Central Propaganda Committee and the Ministry of Information and Communication about the issues relating to the pay-TV market.

The television service providers wrote that they feel too surprised when hearing about the business plans that they believe “would cause the big waste of the state’s money.”

The “business plans” here means the plans to join the pay-TV market followed by some economic groups. The service providers believe that the pay-TV market has become saturated, while state owned economic groups have been told to withdraw their investment capital from non-core business fields. Therefore, it would be unreasonable to let some of the economic groups to inject money in the pay-TV market, the business field which has no relation to their main business activities.

According to VTV, the Vietnamese pay-TV market remains small, while the increase of new subscribers has slowed down recently, since VSTV’s satellite TV (K+), VTC and HTV channels have covered all the areas of the country, satisfying the demand of different classes of people.

Meanwhile, Vietnam also has high quality digital terrestrial TV with DVB-T2 technology provided by VTC, VTV and AVG which has large coverage, reasonable service fee and comes in line with the digitalization trend in the television technology.

There are also at least two cable networks in cities, towns and lowland provinces already, which can satisfy the diversified demand of high income earners. MyTV of VNPT, NetTV of Viettel and iTV of FPT have also reached out to most of the cities, towns throughout the country.

In its document sent to the relevant agencies, VTV affirms that it would be unreasonable to allow Viettel, VNPT and FPT – the big economic groups – to jump into the cable TV market, o­nce the government is now calling to restrict the investments in non-core business fields.

Especially, the most important reason VTV has cited to prove that the economic groups should not be licensed to join the market is that the groups do not have advantages in producing contents – the factor that decides the success of pay-TV service.

On August 23, 2012, the Vietnam Pay-TV Association also sent a document to the Ministry of Information and Communication, asking the watchdog agency not to grant licenses for HFC network to the enterprises.

The association pointed out that it would cost trillions of dong to build up a new TV network, while it would take a long time to take the investment capital back. Moreover, the existence of too many networks would spoil the urban landscapes, while causing the electricity waste.

Regarding the production of the contents for TV programs, analysts have warned that TV service providers would compete with each other to scramble for the copyright of sports and entertainment shows from foreign suppliers, which would lead to the escalation of the required royalties, thus leading to the waste of foreign currencies and harming the national economy.

Therefore, the existing TV service providers have a common voice that it would be better not to grant licenses for cable TV service to some economic groups, while encouraging the enterprises to push up the development of licensed IPTV service, improve telecom services and make software products.

These are the very important fields needed to develop to serve the industrialization and modernization process, and of course, these are the advantageous fields of Viettel, VNPT and FPT. Meanwhile, producing TV programs are not the advantages of the enterprises.