The communist government is nurturing Internet entrepreneurs to catch the wave
HO CHI MINH CITY - The steel railings
and concrete walls of the Saigon Software Park
give Truong Dinh Street, an avenue lined with trees
and airy French colonial villas,
an institutional look.
But the scene at Realtimedia on the fourth floor of
this monolithic office building is anything but
institutional.
Tran Van Tuan, the new firm's 29-year-old owner,
puffs on a cigarette while listening to heavy metal
music. Nearby, a dozen computer programmers sip
coffee while creating Web sites and software
programs for clients in Vietnam, California, Ireland,
Denmark and elsewhere.
"We work with the Internet because we love it,"
said Tran. "And we have a flexible work
environment."
Fortunately for Tran, Vietnam's communist
government has finally embraced the Internet. When
the Web first surfaced in Vietnam three years ago,
many party cadres worried it would threaten their
ability to control public information and protect
national security. Police closed down Internet cafes
and carted off computers.
But now the state envisions high technology as an
economic boon that will create employment, and it
is willing to give young entrepreneurs like Tran a
chance to nurture dreams of Silicon Valley-style
fortunes.
Last July, the government inaugurated its $1.8
million Saigon Software Park building with 25
high-tech companies. In December, officials
announced several measures to encourage software
development, including tax breaks and the
introduction of e-commerce and wireless
application protocol (WAP), which permits Internet
connection without a computer.
In January, the state announced the "Ho Chi Minh
Road of the 21st Century" program, which aims to
have 1.6 million Internet users online by 2005.
Currently, there are only 113,000 users in a nation
of 78 million inhabitants, according to the General
Department of Posts and Telecommunications.
Internet cafes booming
But Internet cafes are booming and Vo Viet Thanh,
the mayor of Ho Chi Minh City, just finished
another high-tech park with 30 companies called
Quang Trung Software City. The complex will also
include restaurants and nearby dormitories for
workers.
Some observers say the key to the formation of
these start-ups is the "enterprise law" introduced last
year that makes it easier to obtain a business
license. As a result, 12,000 new companies have
been created.
"Red tape was really choking private enterprise
here," said Frederick Burke,
a lawyer for the international law firm Baker &
McKenzie who has an office in Ho Chi Minh City.
"The enterprise law helped stimulate new businesses
that don't require much capital, like Internet cafes."
A trade pact signed by former President Bill Clinton
in November has aided Vietnam's fledgling
high-tech industry. U.S. companies such as Oracle
Corp. and San Francisco's MeetChina.com have
formed partnerships with local companies.
MeetChina.com and FTP, the Vietnamese Internet
service provider, are creating Vietnam's second
business-to-business Web site. Mekong Sources
launched the nation's first B2B online site during
Clinton's visit.
Notorious security program
To be sure, the government has not loosened many
rigid business regulations that dampen growth, and
censorship exists on Web links Hanoi finds
objectionable, such as pornography and
anti-government sites created by Vietnamese
abroad. The Internet is monitored by a notoriously
slow security program, or "firewall," that can cause
some computers to crash.
Moreover, Internet access is offered by just four
licensed providers -- the leader is the state-owned
Vietnam Data Communication Company -- that
charge exorbitant prices. Foreign software firms, for
example, pay about $2,500 a month for an Internet
connection.
And with only nine computers for every 1,000
Vietnamese and few telephone lines countrywide,
Vietnam is limited by its poor infrastructure.
Yet Ho Chi Minh City is fast becoming a popular
spot for foreign firms that want to contract out such
operations as software programming, Web site
development and graphic design.
Embracing the web
"There is an embracing of the Web that wasn't here
five years ago," said David Appleton, who employs
a staff of 30 at his Silk Road Systems, a software
company he launched two years ago.
Other foreign-owned companies have followed a
similar path. "I see the potential of this place," said
Steve Paris, general director of Sutrix Media, an
Internet and software development firm with offices
in Switzerland and Singapore. "When I first came to
Vietnam I saw the technical aptitude of the
Vietnamese and their enthusiasm."
Local entrepreneurs like Tran are excited about the
announcement that Saigon Software Park will soon
be given a direct satellite connection. If that
happens, it would be the first step in relaxing control
over the Internet and the first Vietnamese operation
to have such access.
Tran studied law but chose to pursue his childhood
computer hobby instead. Seed money came from
friends since it was nearly impossible to get a
government loan, he said. In 1998, he even tried to
open an Internet cafe.
"I applied once and they told me to wait. I waited
forever," he said.
Tran, who has about 50 clients from Vietnam, the
United States, Europe and Australia, hopes his
company can continue to grow.
"I want a staff of 500," he said.
By Daniel Lovering - SF Gate News - March 13, 2001.
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