Protections up ahead for livestreamers

Livestream numbers have skyrocketed in recent years. Photo: Le Toan

The Ministry of Information and Communications (MIC) is gathering opinions for the draft amendment of Decree No.72/2013/ND-CP released in 2013 on management, supply, and use of internet services and network information. Only accounts, community pages, and content channels that have updated their contact information with the MIC are allowed to livestream and participate in revenue-gathering services in any form via social networking sites.

If the draft amendment is passed, it will have a great impact on livestream activities in Vietnam.

“My only concern is whether I will immediately be allowed to run my business as soon as we send notices to the ministry,” Nguyen Xuan Nga, a 25-year-old owner of a clothes shop on Facebook, told VIR. “Just a small delay in operations would significantly disrupt my shop’s performance.”

Meanwhile, Do Thi Nga, a 30-year-old officer selling cosmetic items through the social networking site, said that the regulation will not cause any serious impact on her business. Instead, she expects boons because “it will help to increase our shop’s prestige amidst the rampage of fraud and trade of low-quality goods on social networks.”

Since early last year, market regulators have tightened supervision over online business activities. To date, the authority inspected dozens of traders of fake, counterfeit, and smuggled goods through livestreaming. They discovered a warehouse selling smuggled items in the northern province of Lao Cai where five people earned around $28 million within two years.

After the case, the Market Surveillance Agency recommended people should be careful when buying goods from livestreams. In comparison with websites or vendors displayed on e-commerce sites, the potential risk of getting low-quality items through livestreams is much larger.

“Therefore, the adjustments in the decree are expected to restrict the spree of violations and also benefit genuine businesses operating online,” explained lawyer Truong Thanh Hao representing the Hanoi Bar Association.

Filippo Giachi, managing director for Asia-Pacific at DOCOMO Digital, the international mobile commerce platform of Japan’s NTT DOCOMO, said that social media livestreams have been growing rapidly in Vietnam over the last two years. Facebook with over 70 million monthly active users has also served as a boon for social commerce, especially amidst COVID-19.

“The proposal to regulate content on the large platforms in Vietnam mirrors similar moves by governments and regulators in other parts of the world, including the United States, the European Union, and India,” said Giachi. “The move may spur the rise of smaller players in the ecosystem and prove to be a win for Vietnamese consumers.”

Moreover, the government should build incentives for the evolvement of livestreams because these will likely occupy a significant chunk of Vietnamese e-commerce, according to Nguyen Hoa Binh, chairman of Nextech Group, which runs a livestream training institution named NextOn.

In China, where livestreams occupy 10 per cent of the country’s e-commerce market, people are encouraged to livestream by providing identity numbers and social credit codes, while also being responsible for all content published on online platforms.

As of the end of 2020, China saw about 600 million people purchasing goods after watching livestreams, and 250 million vendors (16 per cent) of the country’s population were running their business like that.

Similarly, Brands Vietnam also estimated that the country’s livestream market hit about $20 million in 2018. As the number of livestreamers has kept growing since then, the scale has enlarged greatly, and now a billion-dollar sector like China in the next few years is forecast.

According to Germany’s market researcher Statista, Vietnam’s e-commerce market value reached around $12 billion in 2020. In Vietnam, the present digital population and rising internet penetration provide suitable conditions for e-commerce businesses to grow. Consequently, the e-commerce share of total retail sales has been increasing fast in the country, while online channels have surpassed modern retail channels in terms of growth within the fast-moving consumer goods market.

International e-marketplaces such as Singapore’s Shopee and Alibaba-owned Lazada currently hold the leading positions within the Vietnamese e-commerce market. Meanwhile, there has been an increasing number of newly registered local e-commerce sites, especially e-marketplaces.

Local brand thegioididong.com has emerged as one of the most popular e-commerce sites in recent years in Vietnam, specialising in consumer electronics and IT devices. Overall, the business-to-consumer revenues of the e-commerce sector have grown from under $1 billion in 2012 to over $10 billion in 2019.