Viettel: A Rising Player from Southeast Asia Looking to Disrupt the Global 5G Ecosystem

In March 2024, Viettel Group was awarded the Radio Frequency band 2,500 – 2,600 MHz for the next 15 years. According to the Ministry of Information and Communications, this spectrum range can be used for 4G, 5G, and any future telecommunications technologies. This marks a key milestone for the group, which has previously researched and developed its own 5G telecommunication equipment, and enables the company to test its 5G networking equipment in a fully commercial scenario.

As early as November 2023, Viettel had made significant inroads into developing its own 5G networking equipment. For example, Viettel has covered the full range of 5G infrastructure, ranging from wireless transceivers, switches and routers, core network equipment, 5G chipsets, and even 5G devices. This has made the company the only Communication Service Provider (CSP) in the world that is also capable of producing its own 5G network equipment.

While Viettel is the first CSP to also develop network equipment—a business previously dominated by Network Equipment Vendors (NEVs)—it is becoming increasingly common for CSPs globally to utilize a similar business approach.

• For example, Singapore-based CSP, Singtel, has exported its networking expertise via its Paragon solution, which provides CSPs with an all-in-one platform supporting 5G networking, edge computing, multi-cloud, and end-to-end service orchestration capabilities. Currently, the company reports that this solution has been implemented by four other CSPs globally.
• Another example can be found in Elisa Polystar, which is a part of Elisa Group that also operates as a CSP primarily in the Finnish and Estonian markets. Leveraging on the expertise and experience of running a telecommunications network, Elisa Polystar was established as an international software business to provide network automation, Artificial Intelligence (AI), and data analytics solutions to CSPs worldwide.
• Elsewhere in India, Jio Platforms has also announced the acquisition of an NEV, Mimosa Networks, to strengthen and develop production innovations in key technologies, such as Fixed Wireless Access (FWA) services and microwave networks.

Many CSPs are looking to leverage their existing telecommunication expertise and move from simply being connectivity providers to becoming telecommunication solutions providers for other CSPs.

However, in contrast to the examples listed above, Viettel is in the unique position of having entered the core telecommunications infrastructure equipment market, putting the company in direct competition with some of the incumbent NEVs, including but not limited to Ericsson, Nokia, Cisco, Juniper Networks, Huawei, and ZTE. While this has some direct benefits for the company, such as increased self-reliance and closer management of the network, Viettel may potentially also face issues scaling up beyond the country borders to achieve better Return-on-Investment (ROI) due to the long-term dominance of these incumbent NEVs.

ABI Research has identified some key recommendations that Viettel and other aspiring CSPs should consider:

• Accelerate Your Innovation Cycle: Viettel needs to put its foot down on the “gas pedal.” Being a relative latecomer to the 5G equipment market, Viettel needs to catch up with incumbent NEVs that have already begun moving into 5G-Advanced technologies.
• Showcase Successful Implementations: Being a CSP places the company in an advantageous situation to showcase successful implementations of its equipment and solutions in a commercial setting. As compared to traditional NEVs or third-party solution providers, which may need to first demonstrate compliance and compatibility in lab environments, Viettel needs to raise its profile and showcase the effectiveness of its solutions in small-scale commercial scenarios to quickly demonstrate value.
• Leverage and Demonstrate Your Unique Understanding: Being a CSP also helps the company better understand the key concerns and challenges of other CSPs from a deeper perspective. Viettel should take full advantage of its unique CSP perspective to introduce product innovations that truly matter to the telecommunications community.

Viettel is in a unique position to potentially change the dynamics of the global telecommunications community. However, this is not without challenges. For example, investments that could be used to build out the 5G network might be redirected for equipment Research and Development (R&D) purposes, thereby affecting the mobile consumer business for Viettel. Balancing between the various requirements of the different business arms will be a key challenge for the company.