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VN companies can now compete fairly with cross-border platforms

Cross-border TV OTT platforms will have to have operating licenses and pay tax, and domestic firms will be subjected to looser censorship, thus creating opportunities for domestic firms to compete with foreign ones.

A report found that the pay-TV market saw a 9.5 percent growth rate in revenue as of the end of Q2 2022 in comparison with the same period last year, while revenue from OTT TV service (film and TV content provided via internet) had increased by 300 percent.

In addition to businesses that have been licensed and operate in accordance with Vietnamese laws, the domestic pay-TV market is also the home of foreign companies providing OTT TV services across borders such as Netflix, AppleTV, WeTV and IQIYI. 

The platforms mostly provide VOD (videos on demand) which are films, cartoons, documentary films and TV series. There are also reality shows and game shows.            

Vietnamese service providers are inferior to foreign platforms in their home market. According to the Pay-TV association, cross-border platforms hold 80 percent of market share.

State management reported that in 2021, the total pay-tv subscribers on the internet of cross-border platforms such as Netflix, Apple TV and WeTV in Vietnam was about 1 million with estimated revenue of VND1 trillion. 

However, cross-border OTT TV operates without licenses and there is still no mechanism for content censorship. 

“The businesses in the TV field have to face stiff challenges and fierce competition with Big Tech, like the challenges telcos met many years ago when telecom revenue was ‘eaten’ by foreign OTT platforms,” a representative of a Vietnamese firm said.

Vietnamese businesses  complain about the unhealthy competition with foreign platforms. The Pay-TV Association has many times asked state management agencies to tighten control over cross-border platforms and put domestic and foreign firms on the same playing field.

Opportunities 

The government has issued Decree 71 that amends and supplements articles of Decree 06 released in 2016 on the management, provision and use of radio and television services.

According to the Authority of Broadcasting and Electronic Information (ABEI) under MIC, the decree affirms the view about foreign companies providing services across borders to users in Vietnam as well. The cross-border service providers must be licensed.

For OTT TV services, businesses can choose either a service with both online channels and VOD, or a service with VOD only.

Those firms that provide only VOD service have to make declarations in accordance with the form set by MIC. 

Foreign firms that want to join the Vietnamese market have to follow the same procedures as Vietnamese firms.

ABEI said the new decree importantly loosens the regulation on editing, classification and translation of VOD content applied to domestic firms.

VOD content is classified into three groups and must comply with specific regulations. For example, in terms of film, businesses now have the right to classify films themselves under criteria set by the Ministry of Culture, Sports and Tourism (MCST) and take responsibility for the classification; or they can authorize the classification if the films have not been granted a classification license or broadcasting decision.

ABEI affirmed that the new regulation is looser than previous regulations as it allows businesses to take the initiative in editing and classifying the VOD content that is not film, sports and entertainment programs if they can satisfy the criteria set by appropriate agencies.

Previously, under Decree 06, all VOD content had to be edited by press agencies with broadcasting licenses before they were provided on the services.

As for the translation of films and programs, it is necessary to ensure the respect and preserve the purity of the Vietnamese language and not violate prohibitions under Vietnamese laws. The regulation is also applied to the translation of foreign channels.

The new regulations aim at creating conditions for domestic and foreign firms to provide services on the same legal ground, thus ensuring fairness between domestic and foreign firms.

Duy Vu

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