While there were no “shocking” or “explosive” events, what transpired in 2005 indicates that Vietnam’s IT sector has made significant and substantial progress, allowing us to have higher hopes for 2006. We present to our readers the 10 most influential events of 2005 on Vietnam’s IT industry, as selected by the editorial board of PC World Vietnam.
1. National Assembly Approves the Electronic Transactions Law.
On November 19, 2005, the National Assembly officially passed the Electronic Transactions Law (effective from March 1, 2006) with 72.27% of delegates in favor. The law consists of 8 chapters and 54 articles regulating electronic messages, electronic signatures, and authentication of electronic signatures, among other provisions.
This event is of significant importance and long-awaited, showcasing Vietnam’s determination to create a foundational framework to promote trade and integration into the knowledge economy.
In 2005, activities related to electronic transactions in Vietnam saw robust growth with a series of events, including ratings of e-commerce websites, the customs sector implementing electronic clearance, the launch of the national e-commerce portal ECVN, and the issuance of a comprehensive e-commerce development plan for 2006-2010. Vietnam also hosted and chaired the 23rd AFACT conference.
2. The Race for Mobile Information Services
VNPT plans to invest $200 million to upgrade networks for both MobiFone and Vinaphone, while S-Fone’s Korean partner has provided an additional $160 million to upgrade and expand coverage nationwide. The “CDMA force” has formed with S-Fone, Hanoi Telecom, and Vietnam Power Telecom. Viettel officially became a general corporation under the Ministry of Defense. The government approved the establishment plan for the Vietnam Postal and Telecommunications Group. Viettel Mobile became the fastest-growing mobile network, reaching 1 million subscribers in just over a year. Mobile networks competed to reduce fees and launched unprecedented promotional campaigns.
These events demonstrate the rapid development of mobile information and communication networks: advanced technology, reduced costs, and diversified services, creating more opportunities for various service types.
3. ADSL Takes Center Stage
July 2005 marked the explosion of ADSL services. With advantages in price and transmission speed, this form of Internet access overshadowed traditional dial-up methods. Competition among Internet service providers (ISPs) drove ADSL prices down to seemingly unmanageable lows, leading many ISPs to exit the market, leaving it to the “big players.”
ADSL, with its high-speed and low-cost access, not only benefits users but also provides a boost to many online services like e-commerce, entertainment, and media.
4. Announcement of the Intellectual Property Law
On December 12, 2005, President Tran Duc Luong signed the announcement of the Intellectual Property Law No. 28/2005/L/CTN, which was passed by the National Assembly in November. Among the provisions approved were laws specifically regulating software. This is a positive signal, especially for Vietnam’s software industry, which is prioritized for development. However, it also indicates the increasing pressure of copyright issues on organizations and businesses operating IT systems, especially after several domestic computer companies were penalized for using unlicensed software. To gradually implement the provisions of the Intellectual Property Law, the Ministry of Culture, Sports and Tourism, the Business Software Alliance (BSA), and the Vietnam Software Association (VINASA) have signed a letter urging 12,000 Vietnamese enterprises to respect intellectual property rights in the software sector.
5. The Boom of Online Gaming and Legal Issues
Online service providers officially launched online games such as PTV, MU, and Võ Lâm Truyền Kỳ. This form of online entertainment has sparked a significant wave, attracting millions to participate in captivating virtual worlds while promising substantial profits for providers. However, online gaming has also negatively impacted a small segment of youth, leading to legal issues and inconsistencies among authorities in addressing these challenges, somewhat complicating matters for service providers and users.
Online gaming is a completely new form of online entertainment that combines technology, culture, and social elements, strongly appealing to players, especially the youth. This is a rapidly developing entertainment trend worldwide and a lucrative business sector. Furthermore, the development of online gaming is one of the important directions of the Vietnam Software Business Association (VINASA). Therefore, to mitigate the negative impacts of online gaming, suitable management mechanisms are necessary.
Authorities are expected to soon introduce specific regulations for managing this service.
6. The Convergence of Internet and Television
On December 19, 2004, VietnamNet launched a new television service, and the Television Technology Investment and Development Company (VTC) also started providing TV services via the Internet. Additionally, many television stations are preparing to follow this direction. With this method, PC users can watch TV channels on their computers through broadband Internet connections.
For the first time, Internet access was provided through the Hanoi cable television network since February 28, 2005, offering advantages over ADSL via telephone lines. In December, VCTV launched its Internet service via cable TV. With this access method, customers only need to install a specialized modem into the cable line to watch TV channels, surf the web, listen to music online, play games, and send and receive emails at high speeds.
The concept of “Information on Demand” began here. Information that users need, in any form—images, sounds, data—can be transmitted through a single line, making it both simple and economical. This is an inevitable trend in the near future.
7. Integration of Vietnam’s IT
During the first stop of his visit to the United States in Seattle, Prime Minister Phan Van Khai visited Microsoft. There, Microsoft signed important cooperation agreements with the Ministry of Education and Training and the Vietnam Chamber of Commerce and Industry (VCCI). The Prime Minister also extended an invitation to Bill Gates, the chairman of Microsoft, to visit Vietnam. Prior to Prime Minister Phan Van Khai’s visit to the U.S., new Intel Chairman Paul Otellini visited Vietnam and signed a cooperation agreement with the Ministry of Post and Telecommunications. Mr. Otellini recognized that Vietnam would become the largest computer market in Southeast Asia. Meanwhile, many Japanese companies have praised Vietnam’s software outsourcing capabilities.
IDG Ventures Vietnam has officially invested in Vietnamese companies: Peace Soft, iSphere, VinaGame, and Vietnamworks. Thus, IDG has invested in four companies in Vietnam with a total of $5 million.
These optimistic signals before the New Year suggest that Vietnam’s IT sector has opportunities to step onto the global stage.
8. Policy to Promote IT Application
On October 28, 2005, the IT Application Department of the Ministry of Post and Telecommunications was established. This agency is responsible for assisting the Ministry in performing its state management functions and organizing IT applications nationwide. Finally, after much anticipation, IT application, one of the four “pillars” of Vietnam’s IT-Telecommunications development strategy (along with IT-Telecommunications infrastructure, IT-Telecommunications industry, and IT-Telecommunications human resources) has the opportunity to flourish. Earlier, on July 29, 2005, the Prime Minister approved Decision No. 191/2005/QĐ-TTg on “Supporting Enterprises in IT Application for Integration and Development from 2005-2010.” The goal of this project is to assist Vietnamese enterprises in applying IT to enhance production and business efficiency, improve competitiveness, and integrate into the global economy.
Not only does it assist enterprises, but promoting IT application also fosters the development of the IT market, where the software industry will have the most opportunities.
9. Vietnam’s E-Government Index Drops 15 Places
According to a report from UNPAN (United Nations Online Network in Public Administration and Finance), Vietnam ranked 112th out of 178 countries in the e-government index (EGI). Compared to 2003, Vietnam dropped 15 places, from 97th to 112th. The 2004 EGI rankings reveal that the gap in e-government between Vietnam and many other countries around the world remains significant.
Despite considerable efforts to improve the management and provision of public services, this assessment serves as a warning that what we are doing is not enough, while many other countries have caught up or surpassed us.
10. Completion of Phase 1 of the “Computerization of State Administrative Management” Project (Project 112)
There are many differing evaluations regarding this project; some believe it has fundamentally succeeded, while others argue that it is overly ambitious and has not met its objectives. Regardless of the perspective—supportive or critical—the results of Project 112 clearly do not meet current demands.
