Computers Costlier in 2007

 

The trend of the Vietnamese computer market following the penetration into the WTO is completely bisected: the price of hardwares will be lower and the price of softwares will be considerably higher. The very rise in computer software programmes will lead to the costlier ownership of a computer.

 

According to statistics, Vietnam now has some 3,000 IT firms, most of which are engaged in computer and computer parts trading. More and more companies entered the computer assembling and supplying fields after Vietnam joined the WTO. Experts forecast lower price rates for computer hardware. 

 

Computer manufacturing companies in Vietnam have turned out many cheap models. Mekong Green Computer Co. launched a computer set sold at VND4.4 million on the market for a short period of time before its rival VietnamPC introduced another computer set valued VND3.8 million.

 

The price of laptops is also on the downtrend. CMS Computer Co. has said that it is considering another reduction to its laptop models to compete with well-known rivals like Acer and HP.

 

Moreover, the low-priced hardwares made in China are now flooding the Vietnamese market. Low-priced models mainly use Chinese parts, especially Biostar and Assock mainboards.

 

The price of hardwares is hardly on the further fall, especially hardwares for desktops, as the import tax on computer parts hasn’t changed, the tax on softwares is 0 per cent while the price of services is also minimised to beat rivals. At present, the import tariff on computer parts stands between 0 per cent and 10 per cent, mainboards 5 per cent while CPU and RAM are free from tax. By 2010, the import duties on computer parts will be 0-5 per cent. This means that the tax on computer components will drop immediately after Vietnam becomes the WTO member.

The computer price will be higher when genuine software programmes are installed, a market expert said, shattering hopes of domestic consumers. Previously, more than half of computer suppliers used counterfeited softwares for their sold computers. Meanwhile, consumers found it too easy to buy a CD full of software programmes priced at approximately VND5,000-15,000. After the WTO entry, the intellectual property will be protected; hence, computers must be installed with several popular software programmes manufactured by Microsoft, etc at a cost of some US$100. A computer with basic genuine software will be 20-30 per cent more expensive.

The WTO entry exposes both major challenges and opportunities to software solutions suppliers. However, Vietnamese computer assembling firms are worried about the competitiveness against the flooding of foreign firms’ softwares.

80 per cent of desktop market share is of Vietnamese computer firms but 70 per cent of the laptop market belongs to foreign companies.

 

According to the Vietnam Association of Information Processing (VAIP), Vietnam has some 4-5 million computers in use. An Intel report showed that 1.2 million computers were consumed in Vietnam in 2005. With an average annual growth of 25 per cent, Vietnam will have an additional 6 million computers in the next five years.