How Vietnam’s Spectrum Discounts Triggered 5G Rollout

• Vietnam slashes 5G spectrum prices by 90% after failed 2023 auction.
• Deploys 30,000 base stations in 12 months.
• Indonesia, Pakistan, and Bangladesh prepare billion-dollar auctions.

Vietnam’s spectrum discount approach is forcing a reckoning in Asia-Pacific: when Hanoi’s telecom regulator slashed 5G spectrum auction prices by up to 90% after a 2023 bidding failure, industry observers expected chaos. Instead, operators deployed over 30,000 base stations in a year.

While Indonesia and Thailand extracted billions through spectrum auctions – with costs exceeding 10% of operator revenue – Vietnam did the opposite, cutting prices by up to 90% and subsidising network build-out. The result was that Viettel achieved 90% national 5G coverage by December 2025, a timeline that took mature markets three years or more to reach.

The gamble is now attracting attention from regulators preparing spectrum auctions in the region, though whether they’ll abandon revenue maximisation remains uncertain.

How auction failure became policy innovation

The Authority of Radio Frequency Management (ARFM) wasn’t planning a revolution when Vietnam’s first-ever spectrum auction flopped in 2023. The 2.3 GHz band attracted zero bids – reserve prices were simply too high for operators already nursing debt from pandemic-era losses.

What happened next separated Vietnam from its regional peers. Rather than tweaking prices marginally or blaming operators for lack of ambition, ARFM conducted a comprehensive benchmarking exercise in APAC markets. The conclusion was that if Vietnam wanted 5G infrastructure, spectrum pricing had to change fundamentally.

For the 2024 auctions of 2.6 GHz and 3.5 GHz spectrum – the core mid-band frequencies essential for 5G – reserve prices were slashed by up to 90% compared to the 2023 attempt. All three major operators (Viettel, VNPT, MobiFone) each secured 100 MHz. A subsequent 700 MHz auction in May 2025 maintained the affordable pricing approach.

But Hanoi added a second mechanism that distinguished this from simple price reduction: a 15% reimbursement on radio-access equipment costs for any operator deploying 20,000 5G base stations by end-2025. Crucially, the subsidy was capped at auction revenue – meaning spectrum proceeds were recycled into infrastructure not absorbed into general budgets.

The subsidy target was exceeded. Viettel deployed 30,000 base stations by December 2025, achieving 90% population coverage and reporting over five million 5G subscribers in months of commercial launch. VNPT surpassed three million subscribers on a similar deployment trajectory. MobiFone, which launched commercial services in March 2025, is scaling rapidly.

Vietnam’s parliament reinforced the policy direction in June 2025 by passing the Digital Technology Industry Lawwhich is claimed as the world’s first legislation specifically designating telecommunications as a industry. Effective January 2026, it provides tax reductions, duty exemptions and R&D incentives for 5G networks, data centres, and telecom equipment manufacturing.

The spectrum pricing trap

Vietnam’s experiment arrives as Asia-Pacific regulators face mounting evidence that their spectrum pricing strategies are backfiring. GSMA Intelligence data shows regional spectrum costs have tripled as a share of operator revenue over the past decade – from 3% in 2014 to 9% in 2023, well above the 7.4% global average.

Indonesia and Thailand have pushed past 10%. The financial burden isn’t abstract: GSMA analysis demonstrates that every 10 percentage point increase in spectrum costs correlates with 6 percentage points lower network coverage and speeds that are 8% slower. In markets chasing billions in auction revenue, populations are paying the price through inferior connectivity.

The arithmetic is straightforward but politically uncomfortable. Mobile connectivity contributed US$950 billion to Asia-Pacific GDP in 2024 (5.6% of regional output), projected to reach US$1.4 trillion by 2030, according to GSMA Intelligence.

Yet the region faces a US$200 billion infrastructure investment shortfall through the decade’s end – a gap that excessive spectrum costs directly exacerbate by diverting capital from network deployment to government treasuries.

“High spectrum charges heavily influence investment in connectivity,” Gorman noted. “Spectrum should be valued first as an enabler of digital connectivity, not as a short-term revenue stream.”

The statement sounds obvious until you examine upcoming auctions. Bangladesh, India, Indonesia, Pakistan and Thailand are all preparing spectrum assignments or renewals in the next 12-24 months. Indonesia’s repeatedly delayed 700 MHz auction and Thailand’s 3.5 GHz band allocation will signal whether Vietnam’s approach gains traction or remains an outlier celebrated in industry reports but ignored in budget offices.

Pakistan’s situation is particularly instructive: the country has among the lowest assigned IMT spectrum in Asia-Pacific, with a multi-band 5G auction framework finalised in May 2025 but delayed due to operator merger issues and licensing litigation. When it proceeds, reserve pricing decisions will directly determine whether Pakistan follows Vietnam’s infrastructure-first model or doubles down on revenue extraction.

What Vietnam’s model requires

Gorman outlined three policy mechanisms that Vietnam demonstrates and upcoming auctions should consider: rational spectrum pricing that prioritises sustainable network investment over revenue maximisation; long-term spectrum road-maps in frequency bands to provide investment certainty; and coverage targets paired with fiscal incentives to ensure spectrum translates into actual deployment.

The third element is where Vietnam’s subsidy model diverges from conventional infrastructure mandates. Rather than imposing coverage obligations as license conditions – a common approach that operators sometimes game through minimal compliance – Vietnam tied financial reimbursement to verifiable deployment milestones.

The 20,000 base station threshold wasn’t symbolic; it represented the infrastructure density needed for meaningful national coverage. Whether that model translates beyond Vietnam’s specific context is open to debate. The country’s centralised regulatory system enabled ARFM to pivot quickly from auction failure to policy redesign – a luxury that markets with fragmented authority structures or entrenched ministerial revenue expectations may not possess.

There’s also the fiscal reality: Vietnam’s government accepted lower upfront auction revenue in exchange for faster infrastructure deployment. That calculus works when economic planners value digital infrastructure’s contribution to GDP growth over immediate budget injections. Not all finance ministries share that perspective, particularly those facing short-term fiscal pressures.

Beyond spectrum: monetisation follows deployment

Vietnam’s rapid 5G rollout is already enabling operator revenue diversification. All three Vietnamese operators joined the GSMA Open Gateway initiative in April 2025, deploying network APIs including SIM-Swap and Number-Verification abilities that let banks and e-commerce platforms conduct real-time authentication.

The security focus addresses a genuine market need – GSMA-commissioned research shows 89% of Vietnamese consumers are concerned about account hacking and data breaches. Network-level security APIs add a layer of protection that complements consumer education and law enforcement, offering operators a revenue stream beyond basic connectivity.

Fixed wireless access (FWA) for home broadband, private enterprise networks for manufacturing and logistics, and edge-cloud services for low-latency applications are also gaining traction. The common thread is that monetisation models require robust, widespread 5G infrastructure as a foundation – precisely what Vietnam’s spectrum pricing policy enabled.

Vietnam is also positioning for the next technology cycle. The country has included additional 3.5 GHz, 4.8 GHz and upper 6 GHz spectrum in its national roadmap ahead of World Radiocommunication Conference 2027 (WRC-27), which will evaluate 4.5 GHz and 6-8 GHz ranges for mobile identification.

GSMA analysis suggests countries will need 2-3 GHz of mid-band spectrum per operator for 6G-era capacity demands.

The replication question

Whether Indonesia, Pakistan or Bangladesh follow Vietnam’s lead when their auctions proceed will reveal how serious governments are about digital infrastructure versus budget revenue. The policy trade-off is real: Vietnam’s government accepted lower immediate auction proceeds in exchange for faster network deployment and the economic multiplier effects that follow.

That calculation requires finance ministries to value infrastructure’s long-term GDP contribution over short-term cash extraction – a perspective that budget pressures and political cycles often overwhelm. Vietnam’s centralised decision-making also enabled rapid policy pivots that fragmented regulatory systems might struggle to replicate.

But the deployment results are difficult to dismiss. Thirty thousand 5G base stations and 90% population coverage in 12 months represent infrastructure velocity that revenue-maximising approaches have failed to achieve elsewhere in the region.

As mobile connectivity’s contribution to APAC GDP heads toward US$1.4 trillion by 2030, the cost of getting spectrum policy wrong – measured in coverage gaps, slower speeds and foregone economic activity – compounds annually.

Vietnam’s 90% spectrum discount wasn’t a conventional telecom policy. The speed at which operators responded with actual infrastructure deployment suggests it might have been an effective policy nonetheless.

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