Vietnam IT Market:
Briefing 2018
December 2018
IBM Market Development & Insights | 2018 | © IBM Corporation | IBM Confidential
Vietnam – Moving towards a value-added economy
GLOBAL/AP
RANKINGS
•#46/190 in global economy by nominal GDP in 2017
•#68/190 in Ease of Doing Business globally in 2018
•#65/82 in Technological Readiness Ranking for 2018-’22
•#14/14 in AP Cloud Readiness for 2018
MARKET
DRIVERS &
RISKS
ü
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NATIONAL
AGENDA
•Vietnam 2035: Toward Prosperity, Creativity, Equity, and Democracy
•Key Industries: Financial Sector, Manufacturing, Agriculture, Electronics and
Telecommunications
•Technology Focus: E-government, Smart Cities, Cybersecurity and Education
IT MARKET
•US$873M in IT opportunity in 2018, growing at 13%
•6th largest market in ASEAN, 4% of the opportunity and fastest growing along with
Philippines
•FY 2017: IBM #1 in non-x86 market server market
•FY 2016: IBM #2 in GTS, #5 in GBS
Key Country Statistics:
Population Size: 96M
2018 GDP, $:
241B
2018 GDP, %:
6.9%
Economic Summary and Outlook:
Growth in 2018 expected to be 6.9%
vs. 6.8% in 2017
Digital Landscape:
Internet Users:
64M, 67% penetration
Social Media Users:55M, 57% penetration
Digital Landscape Summary:
Vietnam has the 3rd highest # of internet and
social media users in ASEAN
Vietnam
Demographic dividend – young, competitive labor costs and growing middle class
Government continued to move forward with market reforms
Only 40% of population are banked
Market reforms could progress at a much slower pace
Renewed maritime dispute with China
Developer Metrics:
Developer Population:
185K
2019 Growth:
6%
Developer Population Summary:
4th highest developer population in ASEAN,
contributing 14% to overall total
Co-#1 (with China) software outsourcer in
Japan
Top 10 countries for software outsourcing
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
Source: We Are Social & Hootsuite, Jan 2018, GMV2H18 @plan, Evans Research,www.coface.com, www.doingbusiness.org, EIU Tech Readiness, ACCA Cloud Readinesss
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Vietnam At a Glance: GMV 2H18 vs. GMV 1H18
§ GDP Growth Forecast: 6.9% (2018), 6.3% (2019), 5.9% (2020)
§ Economic Drivers: Trade liberalization, privatisation of state-owned enterprises (SOEs), plans to boost role of private
sector in economy
§ Vietnam's economy growth remains robust. Driven by industry, construction and services, high inflows of FDI and a thriving
tourism sector. Private consumption growth is expected to remain buoyant on rising incomes and rapid credit expansion.
§ Economic Risks: Inefficient SOEs, reliance on FDI risks spillover effects from US trade tensions with China and the
Eurozone
§ Developer population: 196K (2019), 217 (2023)
Geo
Vietnam
Version
GMV 2H18
GMV 1H18
Delta
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
2017 ($M)
758
771
-13
2018 ($M)
858
873
-16
2019 ($M)
940
966
-26
AGR 18
AGR 19
13.2%
13.2%
0.0%
9.6%
10.6%
-1.0%
(Source : GMV 2H18 , GMV 1H18 @ Plan Rate)
Vietnam IT Opportunities by Industry
US$M
Industry
Growth (%)
Year 2018 Year 2019 Year 2020 Year 2021
Year
2022
AGR 18
AGR 19
AGR 20
AGR 21
AGR 22
CAGR 18-22
Banking
200
220
244
260
281
13%
10%
11%
7%
8%
8%
Insurance
39
43
48
51
56
13%
10%
11%
7%
9%
9%
Manufacturing
83
89
98
104
112
11%
8%
9%
6%
8%
8%
Government
132
140
150
154
161
10%
6%
7%
3%
5%
5%
Healthcare
8
9
10
10
11
15%
11%
11%
7%
9%
9%
Life science
19
21
23
24
26
11%
8%
10%
7%
8%
8%
Retail
40
45
51
55
60
16%
12%
13%
9%
10%
11%
Computer Services
Industry
80
92
105
112
122
24%
15%
14%
7%
9%
11%
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
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Vietnam’s Digital Landscape
Year on Year Growth:
+28%
Global: 55%
Global: 53%
+20%
Global: 42%
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+0.1%
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Global: 68%
Vietnam
+22%
Global: 39%
Source: We Are Social & Hootsuite, “Digital in 2018 in Southeast Asia”, Jan 2018
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
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Vietnam
Vietnam IT Market Overview
IT
OPPORTUNITY
§2019 Served IT Opportunity @ Plan:
$940M growing at 10%
§2022 Served IT Opportunity @ Plan:
$1.2B growing at 8%
§2019 -2022 Incremental Served IT Growth: $243M
§CAGR 2018 -2022:
8%
§2019 CAMSS Market Opportunity: $749M growing at 14%
CAMSS vs.
Non-CAMSS
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SEGMENTS
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
§CAMSS vs. Non-CAMSS:
CAMSS: 80% vs. Non-CAMSS: 20% of served opportunity
§CAMSS Categories:
Cloud the biggest category at $528M and fastest growing at 25%
§2022 CAMSS Market Opportunity: $1.0B growing at 11%, it will make up 87% of the market.
Cloud is the largest category at $0.9B and growing at 15%
§Top Industries: Banking, Government and CSI make up the top 3 industries in Vietnam and
combined contributes 48% to the opportunity. CSI and Retail are fastest growing
§Top Business Units: Services represents 48% of the opportunity
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Vietnam
Vietnam’s 2019 Served IT Market Opportunity
Vietnam will be 4% of ASEAN’s market opportunity in 2019. It is forecasted to reach $940M
VIETNAM MARKET OPPORTUNITY 2019
$940M
Opportunity
VN
ID 4%
11%
+$82M
Incremental
+9.6%
PH
11%
Growth
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VIETNAM MARKET OPPORTUNITY BY INDUSTRY 2019
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ASEAN
$24B
TH
19%
SG
35%
MY
20%
2019 ($M)
15%
11%
10%
9%
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
10%
10%
7%
8%
11%
8%
8%
7%
67
56
53
45
43
37
36
33
22
21
21
16
15
13
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Ind Prdts
Retail
Insurance
Electronic
s
W&CPG
M&E
Auto
C&P
Life
Sciences
Edu
T&T
E&U
Health
3%
Fin Mkts
92
9%
Telcom
Govt.
140
Banking
9%
10%
6%
CSI
220
12%
2019 AGR
Sum of all the BU's may exceed the Total Served, as ‘‘GTS (Dual)’ includes overlaps with Security (Security Services). Solutions
(Dual) includes overlaps with System (Transaction Processing Software).
Source: GMV 2H18 @ Plan Rate
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Vietnam
Vietnam 2019 Strategic Imperatives: CAMSS vs. Non-CAMSS View
Vietnam’s CAMSS opportunity is forecasted to reach $749M growing at 14%
Cloud will be the biggest category at $528M and
fastest growing at 25%.
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CAMSS will be 80% of the opportunity in 2019, growing to 87%
of the market by 2022
NOTE: AP Average is 75% in 2019, 83% in 2022
76%
Total Cloud
$528M
25% Growth
Total
Analytics
$335M
12% Growth
Total Security
$92M
9% Growth
24%
Total Mobility
$186M
25% Growth
2018
80%
87%
85%
83%
Non-CAMSS
20%
17%
15%
2019
2020
2021
13%
2022
CAMSS will grow at 14% in 2019. Non-CAMSS will decline at -5%
Total Social
$141M
14% Growth
18%
14%
14%
-1%
0.7
0.9
-6%
0.7
-5%
10%
11%
0.9
1.0
-10%
-8%
0.2
0.2
0.2
0.2
0.1
2018
2019
2020
2021
2022
Non CAMSS
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
CAMSS
CAMSS
Source: GMV2H18 CAMSS Overlapped / NonOverlapped @ Plan Rate (Apr 2018)
Non CAMSS AGR
CAMMS AGR
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Vietnam: Among XaaS services, IaaS:Compute is the largest segment,
both in terms of 2019 opportunity and incremental opportunity from 201922, while PaaS is fastest growing
XaaS – Public, Hosted Pvt On Demand, Hosted Pvt Dedicated
Incremental Oppty 2019-22, Market Oppty 2019 & CAGR 2019-22
$120
Bubble Size:
Incremental Oppty 2019-22 ($M)
Market Oppty 2019 ($M)
$100
By Market Opportunity 2019:
• IaaS:Compute is largest by far,
followed by SaaS then PaaS
•
By Incremental Opportunity 2019-22:
• IaaS:Compute is the largest, followed
by PaaS and SaaS as the next cluster
•
By CAGR 2019-22:
IaaS: Compute
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$80
$60
$40
•
SaaS
PaaS expected to be fastest growing,
followed by IaaS:Compute
PaaS
$20
$0
0.0%
•
SaaS: SIS
BPaaS
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
CAGR 2019-22
IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
Note: Measurement View=All; Cloud as Category View (Cross BU)
Source: GMV2H18 Cross BU Cloud @ Plan Rate (27 Sep 2018)
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Public Cloud in Vietnam: Market in 1H17 and 2H17 saw FPT, Microsoft,
Salesforce, SAP, and Oracle forming the Top 5
Oracle has been leveraging its existing partnerships with SIs to
expand its market share in SaaS and PaaS, focusing on SCM,
ERP, CRM, and HCM.
Microsoft experienced impressive growth in the public cloud
services market, thanks to its collaboration with partners in
developing cloud-based solutions for regulated industries.
Vendors categorized in “Others” are mostly SaaS vendors.
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IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
Source: IDC, 2H17 Cloud Services Country Report — Vietnam; IDC, Cloud Services Country Report — Southeast Asia, 1H17
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IaaS in Vietnam: Market in 1H17 and 2H17 clearly led by FPT, followed by
Microsoft, AWS, and IBM
FPT, with Tier-III datacenters and a partnership with Internet
Initiative Japan, has achieved strong growth thanks to its existing
large client base and affordable pricing structure.
With its local datacenter presence and large team, FPT continued
to gain from large enterprises and the public sector. AWS is
catching up in the Vietnamese market as it expanded its local
technical and sales team to strengthen local support services.
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IBM MD&I | 2018 | © IBM Corporation | IBM Confidential
Source: IDC, 2H17 Cloud Services Country Report — Vietnam; IDC, Cloud Services Country Report — Southeast Asia, 1H17
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