Vietnam Mobile Phone Market Momentum Spurred on by Lunar New Year Spending and Smartphone Uptake

Although the Vietnam mobile phone market was unable to maintain its high growth rate as compared to the previous quarter, the market still performed well in 4Q11. Total mobile phone shipments in Vietnam enjoyed 13.6% growth quarter-on-quarter (QoQ). Smartphones continued to be popular as vendors launched a variety of low-cost smartphones coupled with promotional programs which helped shipments in Vietnam to grow 75% sequentially.

“As consumers began their seasonal spending for the Lunar New Year season, the mobile phone market continued to pick up pace,” says Võ Lê Tâm Thanh, Senior Market Analyst for Client Devices Research Group at IDC Vietnam.

“Feature phones accounted for the majority of shipments but smartphones grew significantly in 4Q11. With vendors in Vietnam continuing to push out more low-cost smartphones into the market this year, we expect smartphone shipments to maintain its upward trajectory with double-digit growth projected in 2012.”

Daniel Pang, ASEAN Research Manager for Client Devices Research Group at IDC adds, “Android smartphones grew 53% sequentially in Vietnam due to strong performances from Samsung and Sony Ericsson in 4Q11. Although the OS market is becoming increasingly competitive, we expect Android to sustain its top position over the five-year forecast period.”

On a full-year basis, the Vietnam mobile phone market enjoyed 21% growth year-on-year (YoY). Local vendors struggled to maintain their market share against stronger international brands in 2011. Most of them have launched low-cost and dual-SIM feature phones to compete in the market but the small price advantage was not sufficient to offset the larger gap in brand equity.

Top Three Mobile Phone Vendors in Vietnam in 4Q11

Nokia’s renewed focus on the low-end feature phone segment saw it capture market share at the expense of local vendors. Some of its older models such as the Nokia 1280 were also able to maintain their run rates in 4Q11.
Although under increasing pressure from Nokia, Samsung retained its lead in Vietnam’s smartphone market based on strong performances from its low-cost smartphone range.
Beeline’s “Billionaire Package” promotion garnered heavy attention from the Vietnamese public and allowed them to flood the market with low-cost handsets in 2011 Q4.

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