THE ESPORT SCENE IN VIETNAM

With hundreds and millions of hardcore gamers, both amateur and professional, and thousands of global tournaments each year, computer games are well on their way to become the world’s biggest sport. Esports, also known as competitive gaming or Electronic Sports, is the name for this particular phenomenon that is currently making giant waves around the world.

Global Statistics

Over the last few years, the global eSports industry has experienced tremendous growth with more and more major tournaments being held around the world along with rocketed number of viewers. According to research, there were approximately 71,500,000 people who watched competitive gaming in 2013[i].

The number of eSports players has also grown drastically over the years, with the total number of monthly players of the world’s most popular online eSports game League of Legends exceeding 67 million in 2014[ii], which to put into perspective, is more than the population of France.

Esports in Vietnam

Esports is a strange term but not a strange concept to Vietnamese gamers. The eSports industry in Vietnam, while being relatively smaller than that of other nations in the area, has shown great potentials and has experienced significant growth over the last 5 years, earning recognition from the International e-Sports Federation (IeSF)[iii]

The origin of eSports in Vietnam can be traced back to around 10 or 20 years ago, but the booming growth of the concept only happened around 7 years ago when multiplayer online games such as Dota and CrossFire (known as Đột Kích in Vietnam) started to gain popularity in the Vietnam gaming community and breathe new life into the gaming industry of the country. From then, many gaming tournaments, both nationally and regionally, have been held annually in the country, along with big money prizes, to encourage Vietnamese gamers to sharp up their skills and compete with other gamers in the region.

Esports Viewership in Vietnam

In recent years, more and more Vietnamese people are starting to pay attention to eSports. The Vietnamese government decided to consider eSports as a form of sports, which will be encouraged to develop and grow like any other form of sports in Vietnam. At the moment, there are many websites and online communities for Vietnamese eSports enthusiasts to stream eSports contents and join discussions. Some of them are gamesk.vn, Vietnam Esports TV, eSportsViet.VN, etc. The country also has a television channel dedicating to eSports called ESPORTS: TV, broadcasting on cable television network HTVC from 7AM to 1AM the next day.

On the other hand, eSports tournaments are being held every year in Vietnam, providing opportunities for Vietnamese gamers to upgrade their skills while aiming to attract even more people to this form of sports and entertainment. In 2014, The Vietnam eSports Champions League, featuring 12 top teams from the Southeast Asia region, managed to attract a huge crowd of approximately 10,000 on-site viewers to cheer for the competing teams. This was rather surprising to the members of foreign eSports teams from Singapore and Taiwan[iv], who admitted that even though in their countries there might be bigger eSports tournaments, the audience is not as enthusiastic and eSports-savvy as the audience in Vietnam[v].

Vietnamese Professional Esports Teams

Is there any professional gaming team in Vietnam? The answers is yes. And not only that, the professional gaming teams of Vietnam have proved that their skills are nothing less than that of professional gamers from other developed countries by winning some notable eSports tournaments in the region.

Even though the number of professional gamers in Vietnam is smaller compare to other Asian countries, and Vietnamese professional video gaming teams are not that well-known in the global eSports scene yet, they have exhibit huge potentials to become massively successful players in official international eSports tournaments.

As of 2014, Vietnam is in the top ten list of the highest-earning eSports countries in Asia[vi] with 69 professional gamers. Some notable Vietnamese eSports teams are GeniusGaming (2nd place at World eSports Master 2010), Freedom (2nd place at WCG 2012), Saigon Jokers, Saigon Fantastic 5, Aces Gaming, etc.

[i] Warr, P 2014, “eSports in numbers: Five mind-clowing stats”, Red Bull, viewed on 17 Jun 2015, <http://www.redbull.com/ca/en/esports/stories/1331644628389/esports-in-numbers-five-mind-blowing-stats>

[ii] Riot Games 2014, “League players reach new heights in 2014”, Riot Games, viewed on 17 Jun 2015, <http://www.riotgames.com/articles/20140711/1322/league-players-reach-new-heights-2014>

[iii]Hai, H 2012, “IeSF đánh giá cao sự phát triển của eSport tại Việt Nam”, Game landVN, viewed on 17 Jun 2015, <http://gamelandvn.com/2012/08/21/iesf-danh-gia-cao-su-phat-trien-cua-esport-tai-viet-nam/gameland.vn>

[iv] My, L 2014, “Chúng tôi bất ngờ với khan giả eSport tại Việt Nam”, ICTnews, viewed on 17 Jun 2015, <http://ictnews.vn/game/chung-toi-bat-ngo-voi-khan-gia-esport-tai-viet-nam-115847.ict>

[v] Linh Sim 2013, “eSports ở Việt Nam phát triển mạnh”, VOV online, viewed on 17 Jun 2015, <http://vov.vn/the-thao/ra-mat-kenh-truyen-hinh-esports-tv-140346.vov>

[vi] TT & VH 2010, “Ra mắt kênh truyền hình ESPORTS: TV”, VOV online, viewed on 17 Jun 2015, <http://endgame.vn/tin-tuc/endgame-cafe/tin-10892/viet-nam-vinh-du-nam-trong-top-10-quoc-gia-co-thu-nhap-esports-cao-nhat-chau-a>

A LOOK AT VIETNAM’S TECH ECOSYSTEM

When Vietnam comes up in the conversation, what do you expect to hear?

Contrary to popular beliefs, Vietnam is now far from its day as a war-torn & underdeveloped nation. Nowadays, with a population of over 90 million people, a literacy rate of 94%, and an Internet penetration of over 37 million people, this small Southeast Asian country is quickly on its way to become one of the most significant countries in the region.

Vietnam’s Tech Ecosystem

Despite a huge amount of tech articles and news about tech developments in Vietnam in English, the tech ecosystem of Vietnam is not yet a heated topic for most foreign investors. Nevertheless, the fact is that the tech ecosystem of Vietnam has been growing and expanding rapidly over the last few years. At the moment, the country is full of startups focusing on e-commerce & technology. Every year, there is a galore of conferences & events, along with hackathons, aiming to improve the tech scene in Vietnam by introducing & sharing invaluable ideas and knowledge on programming, coding, mobile, web & education technologies.

The Progress

The progress of the Vietnam’s tech ecosystem has been closely linked with the surge of tech startups of the country, which started almost ten years ago with the first wave of startups comprised of (but not limited to) now-large tech companies such as VNG, VG Corp, Vat Gia[i]. In 2008, the second wave of startups arose, with most of them focused on being e-commerce related such as Tiki.vn. The rise and fall of Nhom Mua in 2012, with its company being investigated by Vietnamese authorities for embezzlement, has “sent shockwaves throughout the [Vietnamese] startup community”[ii], creating a halt in Vietnam’s tech startup scene. However, according to Do (2014), the tech ecosystem in Vietnam at the moment is finally back to its glory days, marked by the worldwide virality of Flappy Bird & Vingroup’s massive investment of over $30 million into e-commerce.

The Potential

The potential of Vietnam’s tech ecosystem is ginormous. The country already has a vibrant innovation community for tech development, and the Vietnamese government is showing great support to technology startups in Vietnam. “Silicon Valley Ecosystem in Vietnam” is an initiative of the Ministry of Science and Technology, combining the Vietnamese entrepreneurial spirit with the U.S.’s most successful practices in startup development & mentoring, accelerators, and venture capital funding and investing[iii], aiming to stimulate the growth of the country’s tech ecosystem of innovations & technology commercialization.

Plus, every year, there are tons of tech events being held to enrich Vietnamese youth and tech enthusiasts to provide more information on the market & the tech country’s tech ecosystem, all the while facilitate & boost investment for Vietnamese tech startups.

Conclusion

Long gone are the days when Vietnam was an underdeveloped country with limited access to Internet and little tech developments. The tech ecosystem of Vietnam has been growing especially fast lately and has shown no sign of stopping. The country is definitely on its way to a brighter future of becoming one of the major players in Asia’s tech scene.

[i] Do, M 2014, “A comprehensive look at Vietnam’s startup ecosystem in 2014: 6 investors, 10 incubators, and lots more”, Tech in Asia, viewed on 29 May 2015, <https://www.techinasia.com/comprehensive-on-vietnam-incubator-ecosystem/>

[ii] Do, M 2012, “The Impact of Vietnam’s Fallen Group Buying Star”, Tech in Asia, viewed 29 May 2015, <https://www.techinasia.com/impact-vietnams-fallen-group-buying-star/>

[iii] Vietnam Silicon Valley 2015, “Intro – Overview”, Vietnam Silicon Valley, viewed on 29 May 2015, <http://www.siliconvalley.com.vn/>

VIDEO GAME INDUSTRY IN VIETNAM

When talking about markets for video games in Asia, most will think of China being the biggest player or the main driving force of the whole area.

However, in recent years, other countries in the region, such as Vietnam and Thailand, have seen a huge increase in the number of gamer, and have been making headlines in the video game community. This has proved that China is not the only place where video games can achieve widespread success and generate big revenue[i].

As of 2013, Vietnam has more than 13 million video game players[ii], and the country’s gaming industry is still growing rapidly. The PC online game revenue of Vietnam has been increasing non-stop since 2012 and was around 291 million US dollars in 2014[iii]. The mobile gaming market also sees a substantial amount of growth with gaming apps being the most consumed content, accounting for 48% of more than 350 million total apps downloads[iv]. With a huge increase in the number of PC and Internet users, along with rising incomes and a huge population of youth who are actively seeking for entertainment content, Vietnam is sure on its way to establishing itself as one of the major players in the Asia’s video game market.

The video game industry in Vietnam benefited greatly from the country’s high rate of literacy and a huge pool of young, dynamic & highly motivated engineers & artists. According to the meeting report of IGDA Vietnam in 2009[v], the Vietnamese video game industry employs around 3000 people to work under various positions: Game Producer, Artist, Designer, Programmer, Game Tester, etc. And as the industry still continue to evolve and expand, the demand for skilled staffs working on video game projects are higher than ever.

At the present, Vietnam is still viewed as a not well-known destination and a hidden gem in the world of video game production outsourcing. Nonetheless, the fact is showing that the country holds great potential to become the best choice for video game outsourcing in Asia.

Sources:

[i] Workman, R 2014, “Vietnam, Indonesia Helping Asian Game Market”, Ayzenberg, viewed on 27 May 2014, <http://www.alistdaily.com/news/vietnam-indonesia-helping-asian-game-market>

[ii] Brown, M 2013, “Vietnam: a nation of online gamers dominated by Chinese and Korean games”, Deutsche Welle, viewed on 27 May 2015, <http://www.dw.de/vietnam-a-nation-of-online-gamers-dominated-by-chinese-and-korean-games/a-17175035>

[iii] Statista 2014, “PC online games revenue in Vietnam from 2012 to 2014”, Statista, viewed on 27 May 2015, <http://www.statista.com/statistics/323814/pc-online-games-revenue-vietnam/>

[iv] Appota Corp 2014, “Insights and Guide to Vietnam Online Mobile Game Market”, Slideshare, viewed on 27 May 2015, <http://www.slideshare.net/appota/vietnam-online-mobile-game-market-insights-and-guide>

[v] IGDA Vietnam 2009, Meeting Report – “The Video Game Industry in Vietnam”, IGDA Vietnam, viewed on 27 May 2015, <http://www.ph-enix.com/igda/IGDAVietnam050609_Report.pdf>

OUTSOURCING IN THE VIDEO GAME INDUSTRY

So should all video game companies adopt the practice of Outsourcing? This blog will talk about the less obvious benefits of outsourcing in the world of video games, and explain why the practice is essential for the modern-day video game industry.

Game outsourcing means delegating to external studios, artists, and developers a variety of development tasks, from 2D or 3D animation to character design. With competition rising and the economy slows down at the moment, outsourcing is no longer a strange practice in the video game industry.

According to Brice (2009)[i], 83% of UK video game developers including Blitz Games and Ubisoft Reflections have admitted to outsourcing various aspects and elements of their gaming projects.

Many companies in the industry started using it initially as a short-term cost-saving strategy but later adopted it as an essential business strategy for their firm due to the vast amount of advantages that came with it.

Despite its booming popularity within the gaming industry, many are still skeptical when it comes to outsourcing for their video game production due to its drawbacks being a little more obvious & immediate, for example low-quality art assets.

Time

  • Regardless of the studio size, outsourcing or subcontracting will allow companies to assemble a team of artists relatively quicker than conventional method of recruiting in-house staff. This will give the company a head start in the competition over other firms in the market.
  • The extra time gained can also be used to either make more content or polish the current content for a better gaming experience.
  • Outsourcing also give small developers an opportunity to go into production without any R&D of their own, which is a very effective way to create art assets without a lot of investment. Certainly, cutting-edge content can’t be made via this method, but most studios don’t really try to achieve or need that to develop entertaining & successful games.

Flexibility

  • Outsourcing or subcontracting allows video game companies to temporarily add more resources by recruiting more developers when they are needed, and release them when they aren’t, without any hassle or hard feelings.
  • Companies will not have to worry about replacing or find more suitable projects for developers who can’t keep up with a certain on-going project, as this task will be handled by the outsourcing service provider.
  • Plus, by utilizing external development, internal art managers of video game companies can worry less about the chance of artists and developers being frustrated or depressed because they don’t like the project given to them.
  • This also means that internal teams of video game companies can be utilized more efficiently and effectively as they can now focus and work on more important and interesting tasks of the game since the more mundane and repetitive tasks can be handled by external parties.

Value

  • External development can be utilized to complete time-consuming tasks more quickly, as it is possible to temporarily assign multiple artists or developers to the same task.
  • More assets can be produced in a shorter amount of time (as they are being created or developed in parallel), which ultimately shortened the total time spent of each staff, making it easier for them to meet deadlines and milestones of the developing process.
  • Without outsourcing, this would be rather difficult to accomplish in-house, as the work would have to be split up and distributed among multiple artists, which would take longer & lower the efficiency of the whole studio.

Turnover

  • A high level of employee turnover indicates and adds inconsistency, uncertainty, and even fear within the video game studio or company.
  • The correct use of outsourcing would provide a company with great continuity and stability, as the sight of colleagues join and leave as projects go in and out of production will be eliminated.
  • Outsourcing can help to preserve teams’ social dynamics, decrease chances of conflicts, and maintain their productivity. Plus, subcontracting also enables production to continue while in-house staff is away on holidays and vacations, even during weekends if necessary.

There are many more benefits that can come from outsourcing in the video game industry. While the practice can seem like a threat at first glance, the benefits of outsourcing in the gaming industry are far outweigh the initial perceived risks.

Without outsourcing, games would definitely be much shorter, have less variety or lower quality graphics, or they would have to be much more expensive due to the efforts the studios and companies have to put out to develop it.

Consequently, fewer games would be made and many developers would encounter even more trouble remaining in business. All of this is the reason why gaming companies should adopt outsourcing as one of their most important business strategies as soon as possible.

[i] References:

Brice, K 2009, Outsourcing is fundamental for UK game development, gamesindustry.biz, available from <http://www.gamesindustry.biz/articles/outsourcing-is-fundamental>, 25 May 2015

THE QUALITY OF VIETNAMESE STAFF IN THE GAMING INDUSTRY

Asia has long been the most favorite destination for western game studios to outsource their game production, mainly due to cheap labor costs and the vast talent pool. And while many people still think that only big countries such as China, India or the Philippines can be chosen as trusted partners for game production, Vietnam has shown great progress and potentials in recent years, and has position itself as one of the strongest contenders for video game production outsourcing with its young, highly-educated, and tech-savvy workforce.

Vietnam’s Video Game Development Education in the Past

In the past, video game development was a rather unfamiliar field and was not viewed by the mass public of Vietnam as a prospective job or career path for young people. This had resulted in a lack of interest from families and students, which consequently lead to a serious lack of programs concentrate on video game production offered by Vietnamese universities and institutions.

Some Vietnamese universities did offer video game production-related courses, but most of the times they prove to be rather useless as the lectures mainly deal with old technologies and focus more on the theoretical aspect. Plus, since modern tech used to be super expensive to import to Vietnam, there is a serious lack of equipment and devices for hands-on practices for students, which consequently leads to a lack of practical experience for graduates.

And So It Changed…

Everything’s changed when Vietnam’s tech industry started to experience booming growth. In order to keep the growth going, the country understands that it must cultivate an increasingly skilled workforce. This understanding has prompt Vietnamese educators and many private technology companies to work relentlessly and intensively to produce a better talent pool that would benefit the country’s tech-related industries.

The gaming industry of Vietnam is also included in this massive booming economic growth and has benefited a lot from it. The rise of technology has attracted more and more Vietnamese youth to tech-related industries, which includes video game production and development. The massive success of Flappy Bird has also breathe new life and reinvigorate the interest and desire to develop video games of the young Vietnamese population. This has consequently led to lots of changes in the education system of Vietnam, with many universities and private institutions offering courses focus on video game development, which will provide aspiring game developers or designers with necessary skills on programming, 2D and 3D design for games, mobile games development, etc. Some of the most notable universities and institutions that offer courses on video game production are NIIT, FPT Arena, Posts & Telecommunications Institute of Technology Vietnam, VTC Academy, Hoa Sen University, and Vietnam University of Science[i].

Aside from education, Vietnamese staffs working in tech-related industry also possess the ability to learn things and apply them correctly quickly[ii]. They also have the reputation for working ward, which has impresses foreign investors one too many times. Most of the people working in the gaming industry of Vietnam nowadays are deeply passionate about what they do, and always striving to become better, more creative and innovative.

Conclusion

It’s true that Vietnam still has a long way to go before they can proclaim themselves as one of the powerhouses for video game production. However, with the staffs working in the country’s gaming industry always trying to upgrade their skills and reaching for new heights, foreign video game studios can be sure that they will not be disappointed when outsourcing their game production to Vietnam.

[i] Nút Chuối 2014, “Điểm danh những cơ sở học làm game tại Việt Nam”, GameK.vn, viewed on 18 Jun 2015, <http://gamek.vn/game-online/diem-danh-nhung-co-so-hoc-lam-game-tai-viet-nam-20140908160034567.chn>

COMPUTER SCIENCE IN VIETNAM: A DIFFERENT APPROACH

Far from the days when Vietnam was considered an underdeveloped country. The country now holds a place in Goldman Sachs’s Next Eleven list of 11 countries that have a high potential of becoming the world’s largest economies in the 21st century (Martin 2012). Many foreign investors are choosing Vietnam as the golden destination for their investments based on the country’s great advancements in various study fields. One of those study fields that has gathered a lot of attention of the Vietnamese public & government over these recent years is Computer Science.

Computer Science is the “IT” subject in Vietnam at the moment, and the demand for computer science grads is higher than ever. Not only businesses operating in software development industry but also companies operating in electronics manufacturing industry who invested billions into their Vietnamese counterparts and factories such as Intel, Samsung, and LG, are seeking for top engineering grads who know their ways in Computer Science world.

Noticing this trend of demand and knowing that there is currently a lack in the supply of computer science grads in the country, the Vietnamese government had started to introduce Computer Science into the curriculum of public schools in Vietnam to encourage the growth of the talent pool for Vietnamese Computer Science grads.

Neil Fraser, a six-year veteran software engineer of Google, had spent some time visiting Vietnamese public schools on his trip to Vietnam in 2013. He came away pretty impressed with the way Computer Science is taught in Vietnamese public schools, and how proficient Vietnamese students are with programming, coding, and Computer Science-related subjects.

According to Fraser (2013), computer classes start in grade 2 and begin with all the basics, including how to take care of your CDs, DVDs, and of course, your 5.25” floppy disks. Things will get more complicated as the kids grow older. By grade 3, the children will have to know how to use Microsoft Windows proficiently. In grade 4, they will start to learn about and practicing with sequences and loops programming in Logo, and by the end of fifth grade, they are fully capable of writing procedures containing loops.

The decision to start teaching Computer Science at an early age is still relatively recent in Vietnam. Nonetheless, it already helps create meaningful changes and put Vietnamese school children way ahead of the average children in other countries. Fraser compared the Computer Science proficiency level of Vietnamese fifth graders to that of a US eleventh graders. What impressed him even more is the proficiency level of Vietnamese eleventh graders after witnessing them successfully solved a programming assignment that is on par with a question on a Google interview. That means an average 17-year-old Vietnamese can get into Google and work efficiently there – imagine what they could do as graduates majoring in Computer Science.

The education policy to start teaching Computer Science at an early age of Vietnamese government is not going anywhere anytime soon. Plus, Vietnamese universities also organised programs promoting STEM education, coding and programming. If you’re a foreign investor seeking for professional and high-skilled programmers, developers or coders, Vietnam is the best destination for your investment.

Fraser, N 2013, “CS in VN”, Neil’s News, viewed on 29 May 2013, <https://neil.fraser.name/news/2013/03/16/>

Martin, E 2012, “Goldman Sachs’s MIST Topping BRICs as Smaller Markets Outperform”, Bloomberg Business, viewed on 29 May 2015, <http://www.bloomberg.com/news/articles/2012-08-07/goldman-sachs-s-mist-topping-brics-as-smaller-markets-outperform>

VIDEO GAME CULTURE IN VIETNAM

When talking about gaming in the East, most people would pay more attention to Japan’s massively successful gaming culture or China’s rapid growth in the market, and end up overlooking some other important markets in the region.

Vietnam is one of those markets that has great potential for big developments regarding video games but is still under the radar to most foreign investors.

Video gaming is one of the most popular cultural aspects in Vietnam. It’s not unusual to see rows of Vietnamese youngsters cramping inside internet cafes & spend hours playing online games every day.

When video games first become popular in the country, most Vietnamese gamers were teenagers (13-19 years old); however, these days, it’s not that weird to see several twenty-somethings, or even primary school kids, sitting alongside the teenagers and competing against them.

Vietnamese people love to play games. The country is known as the largest online game market by value in Southeast Asia, boasting sales of around $200 million in 2012 (Brown 2013).

A survey done by Viettrack (2010) on Vietnamese kids behaviours revealed that “playing online games” is the main source of entertainment for most Vietnamese children.

In 2013, it’s estimated that the country had more than 13 million video game players (Brown 2013). Grubb (2014) predicted that Vietnam will experience the largest growth in the number of gamers in Southeast Asia over the next five years.

Despite how busy life can be for most of them, Vietnamese gamers are still able to find some spare time to satisfy their thirst for gaming. Some choose to play at home with offline games, but most gamers find it’s more exhilarating playing with others at Internet cafes.

In 2010, it was estimated that were 4000 internet cafes in Vietnam’s capital city, Hanoi (Ives 2010). According to Ives (2010), most patrons of internet cafes in Vietnam visit four or five times per week, and spend up to 10 hours a session playing online role-play games.

Online gaming has become so big in Vietnam that in 2010, the Vietnamese government had to announced new Internet restrictions for cyber cafes, in fear of online games and their bad influence on Vietnamese youth. They also order Vietnamese internet companies to shut down online-gaming servers after 10PM, and develop software to monitor computer usage at these Internet cafes to limit the time people spend on online gaming. Despite all that restrictions, Vietnamese gamers still find ways to bypass it and enjoy their online gaming experience.

The Vietnamese’s gaming scene is comprised of an assortment of games distributed or developed by local and international companies. Favourite gaming genres for the country’s gamers are free-to-play massive online battle arena (MOBA) & player kill (PK). Some of the favourite gaming choices of Vietnamese gamers are League of Legends, DOTA 2, World of Warcraft, etc.

Mobile gaming is also growing at a blazing speed in the Vietnamese gaming community after the massive success of Vietnam-made games “Flappy Bird” & “Swing Copters”.

In the past, one of the interesting things about Vietnamese gamers is that, while they played a lot of games, they usually avoided Vietnam-originated games. At that time most of the games played by gamers in Vietnam belonged to either China or South Korea. Now, after the success of “Flappy Bird” & “Swing Copters”, more and more Vietnamese gamers are showing more support for games made by Vietnamese developers.

There is no doubt that video games are super popular in Vietnam, and Vietnamese gamers’ skills are now as good as those of players in any other countries.

Now and in the future there will definitely be a lot of changes & developments regarding the gaming culture. One thing is for sure: Video game culture in Vietnam is growing strong and not fading away anytime soon.

References:

Brown, M 2013, “Vietnam: a nation of online gamers dominated by Chinese and Korean games”, Deutsche Welle, viewed on 27 May 2015, <http://www.dw.de/vietnam-a-nation-of-online-gamers-dominated-by-chinese-and-korean-games/a-17175035>

Grubb, J 2014, “It’s not all China: Vietnam, Indonesia lead a booming Southeast Asia games market”, Venture Beat, viewed on 27 May 2015, <http://venturebeat.com/2014/12/04/its-not-all-china-vietnam-indonesia-lead-a-booming-southeast-asian-games-market/>

Ives, M 2010, “Vietnam: Online gamers elude crackdown”, GlobalPost, viewed on 27 May 2015, <http://www.globalpost.com/dispatch/vietnam/101222/online-gaming-internet-restrictions>

Viettrack 2010, “Vietnamese Kids’ Behaviors”, Slideshare, viewed on 27 May 2014, <http://www.slideshare.net/anhlebksp/vietnamese-kids-behaviors-2010>

VIETNAM – YOUR DESTINATION FOR IT OUTSOURCING OPPORTUNITIES

As businesses grow bigger and more competitive day by day, the search to find an effective solution to cut down costs and expenses has never been more urgent. These days, offshore outsourcing has been chosen as the to-go cost-saving strategy for businesses of all-sizes as it allows them to cut down a huge part of expenditures on wages and management costs but still able to benefit from high-quality talents from all around the world.

Many Asian countries have been taken part as significant players in the outsourcing industry since it has just been made popular by big business owners. Due to rising costs and alarming attrition rates in popular offshoring countries like India & China these past few years, Vietnam has been selected as the new most attractive alternative destination for overseas investors, especially for businesses operating in IT-related industries at the moment. Vietnam’s reputation for outsourcing potentials is not that new – the country already received a “good” rating from American information tech Gartner in 2010 and secured a place in their list of top 30 countries for offshore services.

So what has made Vietnam’s outsourcing industry so special and appealing to foreign investors compared to other countries in the area? Let’s take a look at some reasons why it will pay for your business to invest in Vietnam:

Cost-effective

According to statistics, the labor costs in Vietnam are 90% less than those in the U.S., which equals to significant cost savings for your business. The costs of hiring labour in Vietnam remains notable when comparing to other outsourcing destinations. China & India used to dominate in the cost-savings aspect when it comes to offshoring outsourcing; however, the top spot has been taken by Vietnam in these recent years.

Skilled labour force

Each year, Vietnam produces more than 15,000 university graduates, 10,000 college graduates (1), and a vast amount of talents and skilled experts from various vocational institutions across the country. These graduates are more than capable of keeping up with the demand for professionals from foreign organisations, especially in IT-related fields as 80% of them hold science degrees or degrees related to science. Plus, many businesses that are operating in Vietnam have commented on the workforce of Vietnam as being very “keen on learning”. Moreover, the turnover rate in Vietnam is surprising low at less than 5% as compared to other Asian countries where turnover rates ranges from 10% to 20%.

Languages

English is taught in Vietnamese educational system since first grade, and most university and college graduates can use English with professional proficiency. Businesses who want to outsource their projects offshore but afraid of language barriers can feel safe when choosing Vietnam as their destination.

Investor-friendly business environment

Vietnamese’s government try their best to make tax policies & laws for encouraged sectors such as health, education, high-tech, infrastructure development, etc. beneficial to foreign investors to attract more FDI. For example, businesses operating in encouraged sectors can be benefited from an exemption of income tax for the first 4 years of operations.

Socio-economic stability

Vietnam’s stability in terms of politics, social, and economics is rated really high compare to other countries in the area such as Thailand or Cambodia. The economy of Vietnam is centrally-planned, which helps secure its stability. The country also has a protection law for intellectual-property rights.

It may still be early days for Vietnam’s offshore outsourcing industry. However, with the country making great changes to improve the quality of their labour force and upgrade their infrastructure, businesses that choose Vietnam as their destination for outsourcing can be rest assure that their investments will definitely pay off in the near future.

Vietnamoutsourcing.org n.d., Why Vietnam,http://www.vietnamoutsourcing.org/why-vietnam/ , accessed 19 May 2015.