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The government in Vietnam has threatened to shut down Facebook servers in the country if it does not agree on the new local political content terms.
American social media giant Facebook Inc (NASDAQ: FB) risks losing the Vietnam market as pressure from the local government to censor more political content mounts. Over the years, Facebook has received a belligerent reception in Vietnam over political content on its platform. With Vietnam being a major source of revenue for the social media platform, the company cannot take the pressure lightly. This puts more pressure on Facebook shares as the company faces more legal actions in different jurisdictions.
After rallying approximately 32.98% year to date, Facebook shares have been on the losing streak in the past month. They have dropped approximately 4.16% and 1.45% in the past one month and five days respectively.
Notably, Facebook shares closed yesterday trading at $272.94, up 0.36%, and are up approximately 0.21% in Friday’s premarket. The company has a market valuation of $774.65 billion with 2.4 billion outstanding shares.
Although the company has been significantly successful in its ventures in the past years. Different world governments are drafting laws to make international online platforms included in tax brackets. It has been significantly fueled by the ongoing coronavirus pandemic that has dramatically reduced governments’ tax collection avenues. Hereby putting Facebook revenues at risk of declining in the future.
Facebook in Vietnam
According to media outlet Reuters, the Vietnamese government has threatened to shut down Facebook servers in the country if it does not agree on the new local political content terms. Speaking to Reuters, an anonymous Facebook official indicated that the company had complied with the government’s prior request to increase anti-state posts on the platform. This was back in April but the government has come back again requesting the firm to step up the prior censorship or risk closure in the country.
“They have come back to us and sought to get us to increase the volume of content that we’re restricting in Vietnam. We’ve told them no. That request came with some threats about what might happen if we didn’t,” the official indicated.
Facebook is reported to have 60 million active users in Vietnam who fetch the company approximately $1 billion in revenue. This gives Vietnamese lawmakers a bargaining chip.
Apparently, Vietnam has tried to develop new social media platforms to compete with Facebook but to not avail. Hereby leaving them with only one option to mount pressure on Facebook to heighten censorship over anti-state posts.
Facebook on the other hand is facing criticism from rights groups that claim it is so lenient on censorship requests from different governments.
However, the company through the anonymous official said it is doing all in its power to ensure people enjoy their right to express freely.