Action.vn – Vietnam social networks can have millions of members, but the turnover is still another story in the future. Profit from social network is not easily to gain; there is only 1 or 2 out of 100 to succeed, according to Mr. Paul Nguyen Hung, General Director of VON, the owner of Social network YuMe.
February 2004, the student Mark Zuckerberg of Harvard University started testing his website called thefacebook.com that simply aims to connect friends who are in the same school. After 6 years (2010), Facebook has 550 million members worldwide, and this number is predicted to come up to 1 billion in 2012.
An interesting thing is that Facebook is a money making machine. The Bloomberg L.P. said that in 2010 Facebook made a profit of 2 billion dollar and this is included a significant contribution from online advertisements of popular brands such as Coca-Cola, JPMorgan Chase, Adidas. These advertisements are in the form of online banners, videos or credit programs in order to encourage customers to buy virtual products from online games.
In Vietnam, the current situation is getting exciting with hundreds of available social network. According to Wikipedia, social networking service is defined as an online service that connects people, who share common interests with many purposes. In that case, the leading social networks in Vietnam are now considered to have achieved the target.
After Zing Me (3 May 2010), the social network Go.vn is a key project of VTC Multimedia Communications Corporation. Go.vn’s strategy is similar to ZingMe, which aims to become an open platform system, a convergence of internet, mobile and TV. Mr. Phan Anh Tuan, Project manager of Go.vn, says that the investment in this social network has come up to over 150 billion dong. Total turnover of this social network in 2010 is about 70 billion and the expected level for 2011 is over 120 billion. Revenues come mainly from the value-added services in telecommunications networks, payment services, online entertainments and e-commerce.
It is not easy to get even and have profit.
Mr. Tuan from VTC says that the break-even point of social network’s investment model depends on the development strategy and its implementation.
Beside, investing in a social network requires many sources such as stable financial, qualified human resources in technology and strong infrastructure. Therefore, for small businesses, investing in social network is not feasible. If the investors have ambition, they should focus on satisfying a certain demand of the society, and then they collaborate with the available social networks to develop rather than decide to invest in a new social network.
Meanwhile, the main goal of social networks in Vietnam is continuously attracting users, creating loyalty from them. Not many businesses can think about breakeven and profit during this time. Many networks had to be closed in silent. Profitability of this sector is the story of the future.