"Trap" of dependence on cross-border platforms

The boom in cross-border digital content platforms such as YouTube, Facebook and TikTok, as well as e-commerce platforms including Shopee, Lazada and TikTok Shop, has expanded trade opportunities and global connections in Vietnam. However, it’s also pushing content creators and millions of retailers into a difficult position: complete dependence on foreign platforms.

Following repeated adjustments to fees, advertising and operating policies, e-commerce sellers now face costs of up to 25 percent of revenue. Hoang Minh Thanh, an online seller, said: “Although policies on cross-border e-commerce platforms are eroding profits, sellers have to accept them because there’s still no domestic platform strong enough to replace them.” Thanh’s experience reflects the reality faced by millions of e-commerce sellers.

Previously, on April 1, 2025, Shopee unexpectedly raised fixed fees for some product categories by as much as 10 percent. Notably, commissions on electronic accessories, watches and luggage rose to 9 percent of revenue, three times the previous rate. TikTok Shop and Lazada also changed their revenue-sharing policies, with TikTok Shop raising its commission by another 1 percent. At the time, most online sellers protested vigorously on forums but ultimately had to accept the changes.

Phan Huu Thai, who specializes in selling accessories through Shopee and TikTok Shop, said: “The platform’s policies change every few months. Sometimes fees go up, sometimes benefits are reduced. Often, it’s clear that the platform is squeezing sellers, but we can’t leave because this is our main source of income.”

E-commerce platforms are not the only ones dominating the domestic market. Digital content platforms such as YouTube and Facebook are also taking a leading position. Facebook has 79 million users, while YouTube has 62.1 million. Their broad reach and ability to build communities make Facebook an important platform in the marketing strategies of many businesses. Changes in its policies can therefore significantly affect users.

In early January 2026, Vietnam’s online community was unsettled when several fan pages with large followings were suddenly hidden, had their visibility restricted or could no longer be found on Facebook. Moreover, when social media platforms change their policies or algorithms, numerous content channels can immediately collapse.

The case of Yeah1 Group in March 2019 was a costly lesson. At its peak, Yeah1 owned Asia’s leading multichannel network, with more than 3,000 channels and 610 million subscribers, accounting for about 25 percent of YouTube views in Vietnam. However, after a partner violated copyright rules, YouTube terminated its Content Hosting Services Agreement (CHSA). The decision wiped out thousands of Yeah1’s channels, sent its stock plunging, caused losses of trillions of Vietnamese dong and left the company in prolonged losses for years.

Co-founder and CEO Nguyen The Vinh of Ninety Eight said Vietnam’s digital cultural industry remains heavily dependent on foreign social media platforms such as YouTube, Facebook and TikTok. Not only is user data stored on international infrastructure, but content on these platforms is also governed by algorithms that prioritize views over actual value. “We want to build a digital platform based on trust, connecting people with people, rather than chasing view counts or placing too much emphasis on commercial activities. In other words, we need technology infrastructure built by Vietnamese people,” Nguyen The Vinh said.

According to Phan Vu Tuan, Vice Chairman of the HCMC Intellectual Property Association, the goal of the strategy to accelerate the development of the cultural industry is to increase the sector’s contribution to the economy. The cultural industry currently contributes about 4 percent of GDP, which remains modest compared with 12 percent and 11 percent, respectively, in South Korea and the United States. A major problem facing Vietnam is the lack of digital content distribution platforms, leaving the country entirely dependent on several foreign platforms.

For example, Vietnam’s entire music system and industry must rely on YouTube, a platform that operates through multichannel networks (MCNs), with no mechanism for regulatory or judicial agencies to access information when copyright disputes arise. The Vice Chairman of the HCMC Intellectual Property Association said that Vietnam has implemented controlled pilot mechanisms, or sandboxes, in many fields, but in the cultural industry, this remains a gap. The country can learn from South Korea’s experience in building sandboxes at the city or local level to test new models.

Meanwhile, LinkedIn recorded about 10 million members and is one of the fastest-growing platforms with an increase of over 16 percent, reflecting the growing demand for personal branding and professional networking in Vietnam.

The year 2019 witnessed a robust surge of "made in Vietnam" social networks aimed at forging an independent digital infrastructure ecosystem. Back then, the Ministry of Information and Communications issued fierce directives, heavily pushing domestic enterprises to bravely tackle this uphill battle. They were explicitly urged to architect breakthrough products capable of competing fairly against foreign platforms.

A prime example is the Lotus social network, officially launched by VCCorp on September 9, 2019, boasting a staggering committed capital of up to VND1.2 trillion (US$48 million) alongside the cooperation of over 500 content creators across 20 distinct fields. Ultimately, however, Lotus gradually faded into oblivion after a brief operational period. It hasn’t been the only casualty; similar platforms like Tamtay.vn, Yume.vn, Zing Me, or Go.vn, Vietnamese social networks that once held sky-high expectations have all quietly withdrawn from the market one after another.

The simultaneous collapse of domestic platforms blew the doors wide open for multinational giants to dominate. This failure doesn’t just stem from capital shortages, but a blatant lack of captivating service ecosystems. Against this backdrop, Zalo remains the only domestic platform operating efficiently, boasting 81.3 million monthly users and evolving into foundational digital infrastructure.

To dodge total dependence on foreign entities, Vietnam must develop robust domestic alternatives across core sectors like e-commerce, cloud computing, and AI. With over 85 million internet users and a remarkably young demographic, the nation possesses a robust consumer force exhibiting high purchasing power and technological adaptability.

This landscape is a literal gold mine for local tech enterprises. Capitalizing on these resources with robust local platforms prevents market shares from being devoured and curbs external reliance. Furthermore, leaving the home turf wide open invites severe data leaks, ultimately threatening broader national security.

Head Vu Ngoc Son of the Research, Consulting, Technology Development, and International Cooperation Department at the National Cyber Security Association shared insights with SGGP Newspaper 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.

1. 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.
2. 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.
3. 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 under the 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 immunity.”

Content: Ba Tan, Tran Luu
Design: Huu Vi
Translation: Thanh Tam