Content providers (CP), who always complain that they are put at a great disadvantage in the business cooperation affairs with mobile network operators, now tend to join hands with retailers instead of network operators, because they can seek higher profits with the cooperation.
Content providers (CP), who always complain that they are put at a great disadvantage in the business cooperation affairs with mobile network operators, now tend to join hands with retailers instead of network operators, because they can seek higher profits with the cooperation.
With the boom of 3G networks, the availability of Wi-Fi in many places and the increasing popularity of smart phones as the products are getting cheaper, the opportunities for CPs to earn money are improving.
However, CPs keep complaining that they have been put at a disadvantage in doing business with network operators. The CPs, once again, complained at Mobile Monday even which was held recently, that they could not reach a common voice with network operators.
The problem is that in most of the cases, the 70-30 percent principle is still applied, which means that in profit sharing, network operators earn 70 percent of the total revenues, while CPs just can earn the modest 30 percent.
CPs have been complaining that the principle is unreasonable, asking network operators to rethink. However, network operators still turn a deaf ear to the complaints.
Therefore, a lot of CPs have decided to cooperate with retailers to obtain higher profits. It is now a growing tendency that CPs and retailers join hands to seek business opportunities, because the cooperation can bring benefits to both the parties.
Since the beginning of 2011, Vien Thong A, one of the biggest information technology product distributors, has been cooperating with domestic CPs to develop the content services to be provided to clients.
“We are now cooperating with 10 CPs and providing some 50 apps, including dictionary, or anti-virus software for smart phones,” said Huynh Minh Tuan, a senior executive of Vien Thong A.
“A lot of CPs have contacted us and asked for cooperation in their efforts to expand business,” Tuan added.
Also according to Tuan, a more reasonable profit sharing formula has been set up, with which Vien Thong A enjoys 40 percent of profits, while CPs can earn up to 60 percent.
Besides, the cooperation with “app stores” of mobile phone suppliers has also promised to become an attractive channel. Buu dien Vietnam has quoted Fabien Lotz – Chief Executive Officer of Nokia Ovi Vietnam as saying that the profit sharing principle being applied is 30-70, which means that Nokia gets 30 percent, while CPs earn 70 percent of profits.
Commenting about the new tendency, analysts believe that the model of cooperation between CPs and retailers would develop well, because retailers have many advantages which mobile network operators do not have.
For example, mobile network operators can only provide the keys for installing copyrighted software to clients through SMS messages. Meanwhile, retailers can send staff to directly help clients install the software pieces, give necessary details and consultancy about what applications fit their mobile phones. As such, clients can get support directly from technicians instead of trying to manage themselves.
“If CPs find it too difficult to “play” with mobile network operators”, they can think of joining hands with retailers in order to ease the reliance on network operators,” an expert commented.
The analysts went on to say that though Vietnam now has only three big mobile phone retailers, namely The gioi di dong, Vien Thong A and Veittel, the first cooperation affairs show positive signs of cooperation.
Fabien Lotz from Nokia Ovi Vietnam also said that if CPs do not feel satisfactory in the profit sharing, they should seek more partners in order to optimize their business.
According to Nguyen Xuan Tai, General Director of Nairscorp, the enterprise which has a domestic app – Socbay iMedia – on Nokia Ovi, thinks that CPs should develop apps for touch-screen mobile phones, smart phones, positioning apps and the apps allowing to make payment via mobile phones.
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However, CPs keep complaining that they have been put at a disadvantage in doing business with network operators. The CPs, once again, complained at Mobile Monday even which was held recently, that they could not reach a common voice with network operators.
The problem is that in most of the cases, the 70-30 percent principle is still applied, which means that in profit sharing, network operators earn 70 percent of the total revenues, while CPs just can earn the modest 30 percent.
CPs have been complaining that the principle is unreasonable, asking network operators to rethink. However, network operators still turn a deaf ear to the complaints.
Therefore, a lot of CPs have decided to cooperate with retailers to obtain higher profits. It is now a growing tendency that CPs and retailers join hands to seek business opportunities, because the cooperation can bring benefits to both the parties.
Since the beginning of 2011, Vien Thong A, one of the biggest information technology product distributors, has been cooperating with domestic CPs to develop the content services to be provided to clients.
“We are now cooperating with 10 CPs and providing some 50 apps, including dictionary, or anti-virus software for smart phones,” said Huynh Minh Tuan, a senior executive of Vien Thong A.
“A lot of CPs have contacted us and asked for cooperation in their efforts to expand business,” Tuan added.
Also according to Tuan, a more reasonable profit sharing formula has been set up, with which Vien Thong A enjoys 40 percent of profits, while CPs can earn up to 60 percent.
Besides, the cooperation with “app stores” of mobile phone suppliers has also promised to become an attractive channel. Buu dien Vietnam has quoted Fabien Lotz – Chief Executive Officer of Nokia Ovi Vietnam as saying that the profit sharing principle being applied is 30-70, which means that Nokia gets 30 percent, while CPs earn 70 percent of profits.
Commenting about the new tendency, analysts believe that the model of cooperation between CPs and retailers would develop well, because retailers have many advantages which mobile network operators do not have.
For example, mobile network operators can only provide the keys for installing copyrighted software to clients through SMS messages. Meanwhile, retailers can send staff to directly help clients install the software pieces, give necessary details and consultancy about what applications fit their mobile phones. As such, clients can get support directly from technicians instead of trying to manage themselves.
“If CPs find it too difficult to “play” with mobile network operators”, they can think of joining hands with retailers in order to ease the reliance on network operators,” an expert commented.
The analysts went on to say that though Vietnam now has only three big mobile phone retailers, namely The gioi di dong, Vien Thong A and Veittel, the first cooperation affairs show positive signs of cooperation.
Fabien Lotz from Nokia Ovi Vietnam also said that if CPs do not feel satisfactory in the profit sharing, they should seek more partners in order to optimize their business.
According to Nguyen Xuan Tai, General Director of Nairscorp, the enterprise which has a domestic app – Socbay iMedia – on Nokia Ovi, thinks that CPs should develop apps for touch-screen mobile phones, smart phones, positioning apps and the apps allowing to make payment via mobile phones.
(Source: Vietnamnet)
