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Net being cast wide to capture internet growth
If you want to take a glimpse at the Vietnamese IT industry these days, look no further than your computer screen.
It seems that everything IT is happening in cyberspace, from the fierce competition to the mushrooming of new ideas and services, communities and ways to approach customers to make a profit. Global Internet giants like Yahoo!, Google, and eBay have all been showing strong interest in Vietnam.
eBay just announced a partnership with Vietnam’s ChoDienTu to develop a co-branded online auction site that the two companies expect to go live within three months. Meanwhile, Yahoo! is dominating the instant messaging and blogging communities and Google continues to be Vietnam’s leading search engine. Yahoo! and Google are the two most visited websites in Vietnam, according to web-traffic ranking provider Alexa.
Local domination
But, local online services are still the real dominators of the scene, providing cloned and localised versions of most popular international services, from news to music downloading, video sharing and social networking sites. In the top 10 most popular websites in Vietnam, besides Yahoo! and Google, the rest are all Vietnamese sites.
Most of them are online news services like Vnexpress, Dantri, Thanhnien and Tuoitre, but other less traditional services are gaining ground quickly. Almost all Web 2.0 models have been cloned in Vietnam, from YouTube, MySpace, Facebook, to LinkedIn, Digg, Netvibes and Twitter. Players in the internet ground, especially Web 2.0, range from the largest IT firms like FPT to numerous new and small start-ups.
“The internet is a vital part of FPT’s strategy for the future,” said FPT’s CEO Truong Gia Binh. “We aim to provide an integrated system of various technologies to serve the booming number of Web 2.0 users, who we call ‘E-citizens’. We want to connect them, bring them information, knowledge and services in the most convenient and effective way.”
FPT is trying to establish a bigger presence in cyberspace through various websites and online services. Even Binh recently launched his own blog at truonggiabinh.vn. He explained the move was an “attempt to enrich my life by engaging in this efficient networking tool”, in a bid to satisfy his style as a “highly social person who loves to meet and befriend with interesting people.”
The blog’s content is more personal and less connected to his work. However, some experts have warned that blogging may not be totally personal for an individual like Binh, as not all FPT shareholders would be happy to see the company’s CEO spend time blogging. Blogger Jason Vu wrote: “Almost all top CEOs in the world avoid blogging as it is not easy to control the outcome and time consuming to answer so many comments. A [rare] successful CEO blogger is Jonathan Schwartz of Sun Microsystems, his blog was planned in detail before making public. With clear strategy he added value to the communication with staff, shareholders, clients and developers.”
New opportunities, amid challenges
In fact, most prominent web services in Vietnam today are not from large, traditional IT companies, but rather from recent comers who jumped right on the Web 2.0 bandwagon. The most popular online portal that integrates various services at the moment is not FPT’s Gate.vn, but Zing.vn by VinaGame, a highly successful company that first marked its presence a few years ago by providing hot online games.
“Out of all the developing countries in the world, Vietnam has the highest Internet penetration,” said Bryan Pelz, CEO of VinaGame. The internet boom is creating new opportunities and new markets for entrepreneurs to compete in the already bustling IT industry.
There are countless examples of recent local attempts to catch on this wave, from Tinhvan’s localised search engine Xalo to VC Corp’s online dictionary Baamboo to NaiseCorp’s music service Socbay. The online social networking service is a particularly active area with various players such as Yobanbe, Tamtay, Cyworld and the latest women-focused site PhunuNet. The challenge now for these Web 2.0 players is how to sustain development and make profit, either by revenue streams or through mergers and acquisitions.
“Most Web 2.0 companies in Vietnam do not have a stable revenue model and their hopes are mainly in a buy-off by a foreign giant in the future,” said Nguyen Hung, a Vietnamese entrepreneur. The reason, according to him, is partly that the online advertising sector is not developing in line with the Web 2.0 scene.
Most service providers are still using page views and Alexa rankings as the major measurement, while this has been outdated in the world. Alexa is the favourite web metrics provider in Vietnam, but it does not look at the complete traffic picture for a site since it is mainly based on people who access the site while using the Alexa toolbar.
“There are far more accurate and reliable web metrics services such as Compete, ComScore, Hitwise, Nielsen/NetRatings, Netcraft, Ranking.com and Quantcast, which are used more widely around the world,” said Nguyen Son, an expert from the Ministry of Information and Communications.
Moreover, according to analysts, the Vietnam’s online advertising industry is not getting enough demand for services to make a profit and is not providing enough diversified advertising schemes to attract advertisers. Most websites are still charging a fixed fee for a placement, depending on its size, position and the site’s popularity.
VNN
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