The Internet imperative meets challenges and opportunity

Nguyen Anh Tuan, the slim, Khaki-clad, blue-shirted entrepreneurial 38 year-old father of Vietnam’s Internet service, Vietnam Data Communications (VDC), logs on daily to communicate with his strategic and unlikely partner, 4Real Software in Houston, Texas.

The Internet is at the center of Tuan’s daily life on tamarind tree-lined Ba Trieu street in Hanoi. Here in his spartan and modern office with its highly polished wood floors, the technopreneur spends several hours each day on his laptop, a new Sony Vaio, communicating on-line to his international partner and others in the West.

For Tuan, the Internet is an enabling technology breaking down both physical and political barriers between former enemies. The Internet is playing a significant role in Vietnam’s economic development and is propelling the national economy down the road into the global economy.

Tuan’s expanding government controlled business unit, Value Added Service Center, has licensed their proprietary software, designed for the Palm Pilot, to the Houston-based software company, 4Real Software, which held an export contract valued at $1.5 million. 4Real Software and Tuan’s enterprising state-controlled division are well into the second year of a strategic relationship to develop the software and IT export industry in Vietnam.

“ Yes, Vietnam is now connected to the world and I see an opportunity to do something significant for the country. We have bright, talented young people and they are ready to participate in the globally competitive software industry,” remarked Tuan looking up momentarily from his computer. Among their achieved successes is a joint effort with Microsoft to train hundreds of software developers in Vietnam.

No doubt, for some early foreign investors the promised economic reforms were stalled, but there’s no disputing Vietnam’s large numbers of information technology-literate young entrepreneurs pushing the government for greater access to the Internet.

Adding new impetus for those entrepreneurs still pursuing domestic market opportunities,Vietnam’s Directorate General of Posts and Telecommunications (DGPT) trumpeted its pre-Tet plans to license one or two more firms to open Internet gateways later this year.

“We will license one or two more Internet access providers,” Mai Liem Truc, the head of market regulator DGPT, announced just a few weeks ago in Hanoi.

The country presently has just two Internet gateways, both run by the state-run Vietnam Data Communications Co. (VDC), which provides access for four Internet service providers (ISPs).

The dramatic and surprising business venture between Vietnam’s leading ISP, VDC, and an overseas Vietnamese, Kien Pham, promises to help modernize Vietnam and signals a new beginning for a poor country still slowly struggling to find a balance between control—as evidenced by what many regard as the glacial pace of its economic reforms—and the exigencies of a free marketplace. A government decree issued last year makes clear that all Internet gateways will remain state-controlled.

Vietnam’s own nascent dreams for a software industry are further buttressed with the recent signing of the bilateral trade agreement with the United States. In return for vastly improved access to the coveted US. market, Hanoi has finally agreed to provide foreign investors with transparent approvals processes, and an end to dual-pricing hurdles.

More Vietnamese Silicon Valley trained software engineers are encouraged by the state-controlled Post and Telecommunications. They are being brought into the sensitive and highly politically charged government-controlled Internet service.

“I see no issues here at all,” claims Tuan. “We have a partner who has something to contribute to our success and to his own company. We do not need to discuss politics or reconciliation. Our focus is business development and making profits.”

Last year alone, in both Saigon and Hanoi, many programming courses have sprung up, with numerous overseas tie-ups. In old Hanoi , not far from Tuan’s modern three story government offices, there are over 75 Internet cafes, offering Internet access, while serving up coffee, bike rentals and tour packages, a big jump since a year ago. In the South, on the Dream Hondas choking the streets of Saigon, there are several hundred Internet cafes: “Vietnam is making great strides forward in connecting the country with the West and the latest technology developments,” exclaimed the optimistic Tuan.

Though mindful of the benefits of the Internet, particularly to its aim of establishing the country as a global player in information technology, the ruling Communist party still considers free flow of information a threat to its hold on power.

Tuan’s optimism belies information technology’s cloudy, if not challenging future in Vietnam, caused by daily government censorship. For example, VDC’s firewall intercepts every single request to access a site in Vietnam and then passes it on only if it complies with the country’s existing censorship regulations. The country’s Ministry of Public Security and Ministry of Culture and Information established its “firewall system” with the advent of Internet service access in Vietnam.

Despite these security issues, the government has embarked on an ambitious IT imperative by establishing a subsidized software park for start-up companies at Quang Trung Software City, located about 30 minutes from downtown Ho Chi Minh City. Their dedicated service lines, allows faster access time and rates are reduced to better serve start-up companies.

Through Vietnam Post and Telecommunications, the government has targeted a software turnover of at least $100 million by 2005. For the first time since its development, VNPT’s deputy director, Hoang Thai Tho indicated they earned more than $1 billion last year, installing 4.23 telephones per 100 people.

Saigon Tech, located in the same software park, in a joint degree agreement with Houston Community College System (HCCS) offers an AAS and BS programs in computer and information science technology.

“Our students, now more than 180, are benefiting from the small classes and excellent faculty, and all our courses are taught in English,” added Nguyen Thi Anh Thu from Saigon Tech.

All these initiatives provide some measure of hope to Vietnam’s younger generation. Independent software developers in HCMC, like Phil Tran of Glass Egg Digital Media recognize that Vietnam is poised for growth in an industry that is momentarily in a state of contraction since last year. Glass Egg has found its niche creating detailed animated characters for some of the largest game publishers.

“ We are creating our own Silicon Alley work atmosphere here in Vietnam, and our team of young bright people are ready for all new challenges,” said Tran, a University of California at Berkeley graduate.

Also, Cisco’s chief representative, Ha Huy Hao reveals that they are opening a Cisco Networking Academy soon in Hanoi soon. “ Although the IT developments here have not reached the international standards yet, the Vietnamese are intelligent and eager to learn new technologies,” adds Hao.

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