VietNamNet Bridge - Viettel and FPT both have had to spend big money in their outward investment projects. Meanwhile, the markets are risky with political uncertainties and stiff competition.

FPT, the Vietnamese largest technology group, said it defeated many rivals to obtain the license to set foot in the Myanmar market after three years of exploration.

In Myanmar, FPT would provide a wide range of telecom services, from fixed line service, telecom infrastructure to added value services such as internet TV (IPTV), online games, online newspapers, e-commerce, domain names and hosting.

According to FPT’s CEO Truong Gia Binh, in the immediate time, the company will set up a fiber cable network, and provide broadband services in large cities.

However, investing in telecom infrastructure will still be the top priority because the poor telecom infrastructure system in Myanmar makes it very costly to use internet services. 

FPT declined to say something about the capital it plans to spend on Myanmar project. However, analysts said the investment capital needed for a market with internet covering only five million  of 56 million people would be huge. 

Qatar’s Ooredoo and Norwegian Telenor reportedly have spent billions of dollars for mobile phone tower and other infrastructure items in Myanmar. This does not include spending on marketing campaigns.

FPT, like other investors, not only has to pour big money into the project in Myanmar, but also faces other problems, from political uncertainties, complicated procedures, unclear land policy to the labor force.

Not only FPT, but Viettel, MobiFone and VNPT have also been eyeing the Myanmar telecom market.

In late 2014, anticipating the possibility of losing the bid, Viettel, the Vietnamese military telco, decided to take a shortcut to penetrate the market by contributing $800 million to Myanmar’s state-owned telco Yatanarpon Teleport, the fourth telco in Myanmar which has received a license to set up a joint venture with investment capital of $1.8 billion.

Meanwhile, VNPT and MobiFone both have set up representative offices in Myanmar.

Analysts warned that Vietnamese telcos will have to confront a lot of ‘big guys’ in the market. Japanese KDDI and Sumitomo Corp have teamed up with Myanmar MPT to establish a $2 billion which plans to establish a mobile network. 

With the Japanese partners, Myanmar MPT has cut the service fee by 40 percent, which helped it increase the number of clients by twofold just within six months.

Ooredoo and Telenor have millions of subscribers after two years of pouring huge capital into Myanmar. However, though earning $189 million in Myanmar in 2014, Ooredoo still could not make a profit.

NCDT