Head Vu Ngoc Son of the Research, Consulting, Technology Development, and International Cooperation Department at the National Cyber Security Association shared insights regarding the current operational landscape of cross-border platforms in Vietnam, ranging from e-commerce to entertainment services and social networks.
This picture reflects three major underlying issues.
- Concerning capacity, building a transnational platform requires massive-scale computing infrastructure, long-term venture capital, the willingness to endure years of financial losses, and a substantial network effect. While Vietnam possesses highly skilled technical personnel, it simply doesn’t have the necessary capital accumulation and global product management experience.
- In terms of data sovereignty, when the data and consumer behavior of Vietnamese citizens reside on foreign infrastructure, the nation faces severe risks regarding personal data security in the event of sudden incidents or fluctuations. There’s an undeniable threat of data being exploited completely outside the jurisdiction of domestic laws.
- Looking at digital economy efficiency, significant value-added resources (such as advertising, commissions, and data) are currently flowing overseas rather than being reinvested domestically. This starkly illustrates that Vietnam remains positioned more as a “technology consumer” rather than a “technology creator.”
Head Vu Ngoc Son then listed the two most alarming factors hindering the growth of domestic platforms.
The first is the sheer asymmetry in law enforcement. Vietnamese enterprises are subjected to direct and immediate supervision and sanctions, whereas cross-border platforms often experience significant delays due to conflicting legal regulations across multiple countries and a lack of local legal presence. Consequently, the compliance costs for Vietnamese businesses are disproportionately inflated compared to their foreign rivals.
Next is the glaring disparity in finance and scale. Domestic revenue isn’t large enough to heavily reinvest in core technologies, while global platforms can easily cross-subsidize using funds from billions of users across various markets, coupled with their abundant venture capital.
Those factors lead to the necessity to apply feasible solutions to develop and operate cross-border digital platforms that are large enough to truly attract users.
From a state management perspective, it’s imperative to tighten the requirements for the legal presence of large-scale foreign platforms, ensuring that compliance obligations are applied uniformly to all entities. Simultaneously, it’s essential to invest in foundational digital infrastructure like cloud computing, data centers, and bandwidth in order to effectively reduce input costs.
Vietnam must also establish a sufficiently robust domestic venture capital fund, which could potentially utilize state seed funding, and design favorable tax policies for early-stage tech startups.
On the tech enterprise side, they shouldn’t hesitate to boldly expand into regional markets early on to scale up, rather than exclusively targeting the domestic market. They should focus on niche segments that leverage indigenous advantages like language, culture, and public service integration, instead of confronting global giants head-on.
Serious investment in security, particularly personal data protection and user trust, is increasingly becoming a critical competitive factor. This is a long-term puzzle spanning 10 to 20 years, so it absolutely requires consistent policies.
Commenting on this matter, Deputy Director Hoang Ninh of the E-commerce and Digital Economy Agency (Ministry of Industry and Trade) noted that as economic activities increasingly migrate online, the massive scale of digital platforms requires updated governance. This inevitably demands stricter data management, consumer protection, tax enforcement, counterfeit control, and cross-border regulation.
To build genuinely competitive e-commerce infrastructure, Vietnam must prioritize perfecting its institutions to create a level playing field. It’s crucial for policies to clearly define stakeholder responsibilities in the platform economy, especially regarding data security, business entity identification, and cross-border trade, while still fostering a supportive space for enterprise innovation.
Alongside this, developing robust infrastructure for data sharing is vital. A key trajectory involves elevating Vietnamese enterprises’ capacity by intensifying their application of AI and emerging technologies. By exploiting their deep understanding of local consumers and domestic retail sectors, these businesses can successfully create products with differentiated value.
CEO Tran Viet Quan of Tanca Co. stated that transnational platforms, spanning social networks to e-commerce, fiercely compete for user screen time. Every swipe, video pause, or product click instantly becomes data, helping systems understand consumers. Consequently, this creates highly addictive content loops for countless individuals. It’s evident that as users dedicate more time to short-form videos, they’ll gradually shift toward online shopping.
Global giants compete using colossal infrastructure, immense capital, big data, plus business models willingly absorbing long-term losses to capture market share. Since domestic firms can’t confront them directly, they must guide the community to produce cleaner, better content.
If Vietnam’s digital output is captivating plus abundant, algorithms will naturally distribute it. Vietnamese tech enterprises should actively build tools alongside business models directly atop these major platforms to co-exploit revenue streams, rather than fruitlessly attempting to replace them.
Tonkin Agency’s Chief Growth Officer and HCMC Branch Director Vo Quoc Hung cited WeAreSocial data highlighting Vietnam’s profound dependence on foreign platforms. With approximately 79 million social media users averaging over seven daily hours online, local sellers are severely disadvantaged. They’ve fallen into a passive position regarding costs, with platform fees sometimes eating up 40 percent of total order values.
Furthermore, platforms effortlessly favor cheap cross-border goods, causing domestic manufacturers to lose their competitive edge. The addictive “Shoppertainment” model, fueled by recommendation algorithms, constantly stimulates purchasing behavior while inevitably leading to personal financial waste. Consequently, Vietnam doesn’t just need robust legal sanctions for tax management as well as cybersecurity; individual consumers must proactively elevate their “digital resistance.”
