Internet of Things in Vietnam: Opportunities and Challenges – Vietnam Briefing

Preferential import tariffs for some Cambodian goods entering Vietnam have been introduced and could boost trade between these two neighbors. Here are the details.
In this article the Vietnam Briefing looks at Vietnam’s toy market and the challenges and opportunities it presents for foreign firms.
In the first week of the new year there were a handful of changes to taxes in Vietnam that foreign firms may need to be aware of. Here’s what they are.
Thai Nguyen has become a hive of manufacturing in recent years and is still drawing huge investments from foreign firms. In this light, the Vietnam Briefing takes a look at what key decision-makers have planned for the future of the province.
A German delegation visit to Vietnam from January 23-24 highlighted prospects for bilateral cooperation in developing Vietnamese skill labor. We discuss key points raised during the visit, including challenges and business growth opportunities.
Vietnam Briefing has developed into a premium source for insight on doing business in Vietnam. It publishes business news concerning foreign direct investment into Vietnam, including the most important tax, legal and accounting issues. The Vietnam Briefing Magazine was first published in 2009, and is contributed to by investment professionals based in Vietnam.
Vietnam’s Internet of Things (IoT) market is growing rapidly, with revenue expected to exceed US$13 billion by 2028. In this context, we analyze the opportunities and challenges of foreign investors entering this market in Vietnam.
Internet of Things (IoT) technology covers any device connected to the internet that exchanges data with other hardware devices and responds accordingly.
For example, a house with an autonomous lighting system that can be managed remotely or that uses motion detectors to turn itself on or off as needed. This technology is becoming big business. In fact, IoT in Vietnam is expected to generate US$13.11 billion in revenue, between 2024 and 2028, with a CAGR of 14.83 percent, according to Statista. In 2024 alone, it is expected to reach US$7.54 billion.
That said, while there are over 15 billion IoT-connected devices worldwide, or an average of about two IoT-connected devices per person, in Vietnam that number is less than one per person. This, however, just means there is plenty of room to grow.
Decision 36/QĐ-TTg, issued earlier this year, lays out a blueprint for the infrastructure needed to grow Vietnam’s IoT industry.
Specifically, according to Point A, Clause 2 of Article 1 of the Decision, all of Vietnam’s high-tech parks, research, development, and innovation centers should be able to connect to the internet with a minimum speed of 1Gb per second by 2025.
Furthermore, Vietnam is targeting the provision of 5G mobile broadband network coverage to 99 percent of the population by 2030.
In recent years, several high-tech zones have been developed to encourage foreign enterprises to invest in tech manufacturing in Vietnam.
Hoa Lac High-Tech Park (HLHTP) was one of Vietnam’s first high-tech parks. HLHTP focuses primarily on research and development in four areas: information technology, biotechnology, new material technology, and automation technology.
Another example is Ho Chi Minh City High-Tech Park. This has been one of the most successful technological parks in Vietnam, with more than US$12 billion invested.
Whereas there are limits on foreign investment in telecommunications in Vietnam broadly, in core IoT-related fields like cloud computing and data center development there are none. See: Vietnam’s Amended Telecommunication Law for Foreign Firms.
A growing economy, combined with rising urbanization, has created a high demand for IoT products in Vietnam. This includes smart gadgets and technology like home security systems that connect remotely to mobile devices and televisions that connect to home wifi allowing users to share content between their home theatre systems and mobile devices.
Foreign electronics firms may find a lucrative opportunity in retailing IoT-related products ranging from mobile telecommunications devices to more complicated, responsive monitoring systems.
With several big electronics retail chains, with stores spread all over the country, manufacturers of IoT devices can relatively easily reach Vietnam’s booming consumer market.
Vietnam currently lacks experts with in-depth knowledge of IoT, according to Minh Duc Nguyen, Associate Professor – Doctor at Hanoi University of Science and Technology.
Nguyen says this shortage of highly educated human resources is a result of Vietnam’s lack of training programs teaching IoT development.
Foreign educators, therefore, could potentially find a profitable investment opportunity in establishing comprehensive IoT education and training programs. Whereas these programs are already on offer, they are currently limited and there is plenty of room for more.
Because IoT devices are most effective when connected to other IoT devices there is a need for technical standardization. Fragmentation in the development and deployment of IoT devices can lead to inconsistencies and integration problems. This can reduce performance and make them more expensive to operate.
The proliferation of IoT devices raises cyber security concerns. Hacks, for example, may result in significant losses to both consumers and businesses. As a result, investors and enterprises in this industry should expect to devote a significant amount of time and resources to updating their security systems.
FPT Software is part of the FPT Vietnam Group. It is a software services and solutions provider with a global customer base. The company provides software solutions to several of the world’s largest corporations, including Hitachi, Unilever, and Deutsche Bank.
VNPT is a company with network infrastructure and mobile services coverage throughout Vietnam. VNPT’s flagship IoT product is VNPT IoT Guard. According to a company spokesperson, this is one of the first commercial-use products in Vietnam for protecting IoT devices.
The Military Industry and Telecommunications Group (Viettel) has the most extensive telecommunications network coverage in Vietnam. Viettel has used this to effectively develop a Connectivity Management Platform (CMP) which improves the connection and data-gathering capabilities of IoT devices.
IoT devices are becoming increasingly popular in Vietnam and this has not gone unrecognised. The government is actively promoting investment and development of the industry and several homegrown IoT products have already come on the market.
It is, however, still a relatively small industry in Vietnam when compared to the rest of the world, with plenty of room to grow. With this in mind, foreign firms producing IoT devices and services may find lucrative opportunities in this rapidly emerging country.
For more information on accessing the Vietnam IoT market, contact the business advisory experts at Dezan Shira and Associates.
About Us
Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Eurasia, including ASEAN, China, India, Indonesia, Russia & the Silk Road. For editorial matters please contact us here and for a complimentary subscription to our products, please click here.
Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, India, and Russia. For assistance with investments into Vietnam please contact us at vietnam@dezshira.com or visit us at www.dezshira.com
 
Our free webinars are packed full of useful information for doing business in Vietnam.
Meet the firm behind our content. Visit their website to see how their services can help your business succeed.
Subscribing grants you this, plus free access to our articles and magazines.
Subscribe to receive weekly Vietnam Briefing news updates,
our latest doing business publications, and access to our Asia archives.
Subscribe now to receive our weekly Vietnam Edition newsletter. Its free with no strings attached.
Not convinced? Click here to see our last week’s issue.
Type keyword to begin searching…

source

About The Author

admin

See author's posts