MediaTek supports our customers with mass production, so they can make cheaper products faster. But Vietnamese companies also need to build up their capability.
|Daniel Lin - Deputy director of Emerging Market Sales, MediaTek |
If companies are unable to build from our chipsets, one solution we often provide is the module maker, so they can build from modules. In other cases, MediaTek will bring in our experienced international partners with a good supply chain to support our Vietnamese customers to build the products and bring them to the international stage.
The same problem exists in countries like Thailand, Australia, and Singapore. The overall standard of living must improve before people become tech-conscious. Currently in Vietnam, if you want to have a smart home, you can maybe have your property developer or smart home service providers do it for you, whereas in countries with a more tech-savvy population, people can do it themselves.
One challenge that arises on the integration and hardware development front is that, Vietnamese product developers would like to go for low costs and try to hit the mass market. They might start with microcontroller units and try to integrate all the chips from different vendors together, until they realise that the cost is too much after about 12 months.
We see this problem with even tier-one brands who attempt to maintain 10-20 models with 30 such units over the years. MediaTek offers one IoT chip that does everything, but often product designers have never heard of our solution and did not find the right people to talk to.
The other aspect to pay attention to is the security and cloud service. IP cameras, which many people are using, are one example. IP cameras are so easily hacked, even with cameras from top brands. Cybersecurity is also a key area which has to be implemented into the chip and into the product.
Currently, as the market is always looking for low costs, so privacy and user experience are often ignored. Last year, the EU issued a warning to all IoT product companies to ensure security is implemented into all products. Otherwise, millions and millions of these products can simply become hacker tools.
IoT is not a one-day investment. Producing high-quality products while ensuring security is not something that any company can easily invest in. If we consider aspects like government or military or maybe for public surveillance, with IP cameras recording 4K videos continuously every day and the amount of storage that it takes, we can see that this is a huge investment and is not something that you can just build from day one and then expect to finish the next month.
That said, I think the phrase “IoT” is overly abused because everybody talks about it, but not much about the people who know what the real applications are. This is a dilemma not just in Vietnam, but worldwide. For me, for any applications where you use simple micro processes, if you can turn that into something smart it gives you more value, then we have a real IoT product. So, the real solution is for people to be more innovative and make real efforts to create.
In the United States, there’s a company called Peloton that makes treadmill systems, with a very simple but innovative idea to display a tablet on their equipment, so they can sell online classes to users. This creates connection: you are not just running by yourself, but with a personal trainer that you can see online and race with other people.
That has been a very successful product. This is one example of the fact that if everybody starts thinking of just improving a little bit and being innovative, they can get the product out. Step by step, simple IoT products can create a powerful ecosystem.
What we have observed about Vietnamese companies is that they are very innovative and often want to build innovative applications themselves. But what we need is to create a playground to support these companies to become bigger and more successful.
The Vietnamese government has done a lot to support the sector. In terms of connectivity, 80 per cent of households have Wi-Fi. That, to me, is already something very valuable for the building of IoT. The pushing of digitalisation is set, and now Vietnam just has to encourage more companies to get involved, whether by giving subsidies or through tax incentives. If innovation is encouraged, we can see things we never would have imagined.
As Vietnam moves towards 5G, now there is a shift to move IoT devices up to 4G connectivity. In terms of the infrastructure costs, this is something that the government can encourage operators to support more.
Operators are also engaging with us on this topic, as we are already supporting and offering them solutions. Now with 5G becoming the next frontier, there are already other countries that are going into the fixed wireless access.
When you have such networks available, people can start to install outdoor units to offer connectivity for farming or agricultural businesses. IoT can now be used to improve productivity in farming. Security is definitely also a standard that should be encouraged as part of this.
Only then can you build an ecosystem, linking up all these companies with relevant products into associations and bringing them outside of Vietnam, where the cake is bigger.