VZCZCXRO2513
RR RUEHHM
DE RUEHHI #2477/01 2710220
ZNR UUUUU ZZH
R 280220Z SEP 06
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 3531
INFO RUEHHM/AMCONSUL HO CHI MINH 1881
RUEHGV/USMISSION GENEVA 1123

UNCLAS SECTION 01 OF 02 HANOI 002477 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR E, EAP/MLS and EB/CIP RICH O'BRIEN 
DEPT PASS TO USTR DAVID BISBEE AND JONATHAN MCHALE 
 
E.O. 12958: N/A 
TAGS: ECON ETRD ECPS KPRV WTRO VM
SUBJECT: SIGNAL PIRACY AND COMPETITION PROBLEMS IN VIETNAM'S TELECOM 
SECTOR 
 
SENSITIVE BUT UNCLASSIFIED. DO NOT POST ON THE INTERNET. 
 
REF: A) State 140757 B) Hanoi 827 C) Hanoi 1451 D) Hanoi 2312 
 
¶1. (SBU) Summary: Econ/C met with Director General (DG) Quan Dzuy 
Ngan Ha of the Ministry of Posts and Telematics (MPT) to deliver a 
strong message on USG concerns over signal piracy.  DG Ha replied 
that MPT has urged the state-owned broadcaster, VTC, to discontinue 
its re-broadcasting of pirated satellite signals.  Ms. Ha said the 
MPT also advised VTC to conclude legal licensing agreements with all 
foreign content providers as soon as possible.  MPT will participate 
with U.S. industry representatives in a seminar in December to 
discuss ways to construct a viable business model in the pay-TV 
industry in Vietnam.  Ms. Ha also discussed MPT's efforts to address 
competition issues, including intervening in an interconnectivity 
dispute between VTC and a new competitor, EVN.  End Summary. 
 
MPT's Response on Signal Piracy 
----------------------------------- 
 
¶2. (SBU) Econ/C met with the Director General of the International 
Cooperation Department of the Ministry of Posts and Telematics 
(MPT), Ms. Quan Dzuy Ngan Ha, on September 7 to deliver a strong 
message on USG concerns over signal piracy in Vietnam.  He noted 
particular concern about the unauthorized practices of state-owned 
Vietnam Television Technology Investment and Development Company 
(VTC) which broadcasts pirated content through its digital 
terrestrial network. 
 
¶3.  (SBU) In response, Ms. Ha said that under a directive from the 
Government of Vietnam (GVN), MPT has ordered VTC to report on its 
activities and licensing agreements.  MPT has also urged VTC to 
negotiate legitimate licensing agreements for its broadcast content. 
 According to Ms. Ha, MPT will make a report to the GVN based on 
VTC's submission, but she did not say when the report would be 
ready.  She added that VTC informed the MPT that it is currently in 
discussions with foreign content providers in order to resolve 
licensing issues.  (Note: A private sector contact familiar with 
similar discussions earlier this year characterized VTC's efforts as 
"going through the motions."  End note.) 
 
¶4. (SBU)  Ms. Ha said that VTC claims the growing number of 
contracted distributors for foreign broadcast content (Q-Net, 
NACENCOM, BHD and others) operating in Vietnam has made it difficult 
to "know which are the legal representatives" of U.S. and foreign 
firms.  In response, Econ/C suggested that VTC discuss this issue 
directly with the Cable and Satellite Broadcasting Association of 
Asia (CASBAA) and foreign content providers, and offered the 
Embassy's assistance in facilitating these connections. 
 
¶5.  (SBU) In addition, Ms. Ha indicated the Ministry of Culture and 
Information (MOCI), the Ministry of Science and Technology (MOST) 
and MPT are currently drafting guiding documents to implement the 
recently-passed Intellectual Property Rights Law.  She said these 
guiding documents will help ensure greater accountability and 
strengthen enforcement against violations of broadcast and 
television copyrights. 
 
¶6.  (SBU) Regulatory responsibility for the television and cable 
broadcasting sector in Vietnam is divided between MPT (transmission 
and infrastructure) and MOCI (content management.)  Ms. Ha noted 
that rapidly developing technology has made this delineation more 
ambiguous.  Therefore, she said, MPT and MOCI are drafting a 
circular more clearly outlining each ministry's regulatory 
responsibility. 
 
¶7. (SBU) Econ/C underscored that the Embassy, CASBAA and industry 
representatives want to continue to work with the GVN to strengthen 
copyright protection.  Vietnam must do more to address illicit cable 
and broadcast activities.  Ms. Ha acknowledged the importance of 
these issues.  She responded that in an effort to address them, MPT 
has been coordinating with CASBAA and MOCI to host a seminar on 
December 14 to discuss ways to construct a viable business model in 
the pay-TV industry. 
 
Competition Problems in the Telecom Sector 
------------------------------------------ 
 
¶8. (SBU) Econ/C also raised questions over the state of competition 
within the telecom sector.  For example, the press has reported 
extensively on an interconnectivity dispute between the former 
telecom monopoly VNPT and its rapidly growing competitor EVN.  Since 
the introduction of competition in the telecom sector, competing 
companies, such as EVN, have often accused VNPT of using its 
dominant position as the former monopoly to limit access to the 
national telecom infrastructure. 
 
 
HANOI 00002477  002 OF 002 
 
 
¶9. (SBU) In responding, Ms. Ha referred to the MPT's action in July 
in its role as regulator when it ordered the two firms to resolve 
their long-running interconnectivity dispute by August 1.  She said 
that since the MPT issued its order, neither firm has raised 
additional complaints.  MPT therefore considers the dispute 
resolved.  As for related press reports that EVN's recent 
application to expand its service area was rejected by MPT, Ha 
explained that EVN was operating in violation of its license.  She 
asserted that the MPT denied EVN's latest application on the basis 
of continued noncompliance with the MPT's technical requirements. 
 
¶10. (SBU) Comment:  The Director General's words were mostly 
positive in tone, but MPT's deeds to date have not been sufficient. 
Resolving the issue of signal piracy is a major objective for this 
Mission.  We will continue to press the GVN to protect the rights of 
all affected U.S. stakeholders.  We will also continue to encourage 
the GVN to improve competition in the telecommunications sector, 
which will help Vietnam's economic development.  As Vietnam prepares 
for entry into the WTO, and begins to implement commitments 
providing more opportunities for U.S. firms, MPT will have to do 
more to ensure a level playing field for competitors.  How Vietnam 
deals with the concerns of private Vietnamese companies, e.g., EVN, 
is an indicator of how it might treat foreign companies.  End 
comment. 
 
ALOISI