update SINGAPORE--Telecommunications service provider Pacnet has launched a point of presence in Vietnam, through a partnership with FPT Telecom.
The partnership with the Vietnamese Internet service provider (ISP) will enable Pacnet to sell services in the country, as well as Cambodia and Laos, Pacnet CEO Bill Barney said at a press briefing Monday.
Pacnet hopes to provide broadband connectivity to the MNC (multinational coporation) base in Vietnam--some 360 of the Fortune 500 companies have set up presence in the country, he said.
These companies do not have large bandwidth requirements, but need their networks to be resilient for mission-critical appications, he noted.
Quoting figures from the United Nations Conference of Trade and Development (UNCTAD), Vietnam bucked the global trend of falling foreign direct investment (FDI) and saw its FDI triple from US$20.3 billion to US$64 billion in 2008, he said.
The FPT Telecom partnership is also primed for an explosion of bandwidth needs in the country, Barney said. Pointing to its current Internet penetration of 24 percent, with less than 3 percent broadband penetration, he said Vietnam has "huge potential" for growth.
The new alliance also enables Pacnet to establish a landing station in the country, he added. "The biggest challenge in the telecoms business is getting government approval to build a [landing station]," Barney explained.
Unlike Vietnam, countries such as Singapore, Hong Kong, Japan and Taiwan, allow telecoms service providers to wholly own landing station assets without the need to partner a local business, he said.
Surge in Asia's bandwidth demands
Vietnam's appetite for bandwidth is part of a global phenomenon that is seeing bandwidth needs double every five months, said Barney.
To meet this demand, Pacnet in April completed a 3,200Gbps upgrade of the EAC-C2C subsea cable system that it owns and runs. It has also accelerated the next phase of upgrades, which will add 2,000Gbps of capacity to the network, because of the surge in demand, Barney said.
He added that the mobile application industry has "pulled the market forward", driving an increase in mobile data consumption. This has in turn resulted in mobile services providers buying more bandwidth from wholesale providers such as Pacnet, to meet the growing consumer demand, he said.