A recent decision by Zalo, Vietnam's leading instant messaging app, to collect an account registration fee has sparked discussions among users and industry experts about whether over-the-top (OTT) service providers should charge business-to-consumer (B2C) users and how to best implement such charging.

Unlike other messaging apps such as Telegram, Facebook Messenger, and WhatsApp, which continue to offer free services to B2C users, Zalo has recently taken a ‘bold’ step by introducing a registration fee for new accounts.

This decision comes when Zalo already boasts the largest user base in Vietnam.

Many B2C users have reported to Tuoi Tre (Youth) newspaper that the Zalo platform requires them to obtain a verification code when registering a new account, recovering a password, or switching to a different device.

To do so, they must send a message to a Zalo operator number – incurring a fee of VND1,000-5,000 (US$0.04-0.20) per message, depending on the number used – or call the Zalo hotline at a rate of VND1,000 per minute.

Zalo has cited system congestion as the reason for being unable to automatically send verification codes to users.

Many B2C users have expressed concerns about the fee, such as T. Tuyen, who shared his surprise at the charges, stating that basic messaging services should remain free.

“Businesses need revenue to balance costs, but fees should only apply to premium features with enhanced security and upgraded functionalities. Similar platforms abroad focus on increasing revenue from partners, including businesses and entrepreneurs, instead of individual users,” he explained.

Cris Duy Tran, head of growth at blockchain-based metaverse platform The Sandbox, a subsidiary of Hong Kong-based gaming and metaverse firm Animoca Brands, also noted that “service providers with large ecosystems, like Zalo, usually prefer charging business partners rather than end users to avoid the perception of 'revenue-maximization' among their consumers.”

Meanwhile, some business-to-business (B2B) users are open to the idea of paying more if Zalo improves its offerings.

Tran B. Minh, who operates a business account, said he already pays a monthly fee for Zalo's services.

“I am willing to pay a higher fee if the current features are upgraded to enhance business efficiency,” he noted. 

Minh also suggested that Zalo could introduce additional packages, such as increased storage capacity on Zalo Cloud, expanded friend limits, or larger group chat rooms, similar to those available on other international platforms.

“Zalo is convenient because almost every Vietnamese person uses it now; however, there are many features that this app needs to upgrade to enhance its competitiveness against foreign rivals,” Minh emphasized.

Tuan Ha, founder of Vinalink Academy, a leading digital marketing training in Vietnam, noted that the OTT market is fiercely competitive.

“Zalo dominates the Vietnamese market, while other locally developed apps struggle against major international players like Facebook and Telegram,” Ha said.

Ha highlighted that Zalo has long charged B2B users for premium services and that he pays a monthly fee for his Zalo business account. However, Ha commented that introducing a registration fee for B2C users, even if relatively small, might lead to frustration.

“This move could be aimed at reducing fake accounts and improving service quality. However, it may also be an effort to increase revenue. Either way, user reactions must be carefully considered to prevent a backlash,” he warned.

Many industry experts believe that a ‘freemium’ model – where users access basic features for free but pay for premium upgrades – would be a more effective approach.

Ha suggested that business users would be more willing to pay for additional services, such as larger friend lists and expanded group chat capacities, rather than a small, mandatory registration fee for all users.

Internationally, platforms like Facebook continue to generate significant revenue through advertising rather than direct user fees. According to a report from WARC Media, Facebook's global ad revenue was projected to exceed $100 billion in 2024.

The digital marketing platform Sprout Social revealed that advertisers pay nearly $2 per click on Facebook ads.

Meanwhile, Sensor Tower, a leading data provider on the global digital economy, stated that Facebook accounted for 29 percent of U.S. retail ad spending in the fourth quarter of 2024.

Meta, Facebook's parent company, projected earnings between $45 billion and $48 billion for that period.

Currently, Zalo remains Vietnam’s most popular messaging app.

Late last year, the Ministry of Information and Communications, which was recently merged with the Ministry of Science and Technology to form the Ministry of Science, Technology, and Communications, released a report confirming that Zalo had surpassed global platforms such as Facebook, TikTok, and Google in user numbers, reaching approximately 77.6 million users as of late September 2024.

VNG Corporation, Zalo's parent company, revealed that the platform handles over two billion messages daily and has approximately 68,000 paying business partners. By the end of 2024, 17,273 verified accounts had been created for government agencies and utility service providers. 

Furthermore, Zalo’s B2B service revenue saw a 150 percent growth rate in 2023 compared to 2022, with more than 20,000 paying business clients.

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