Zalo subscription fees to add little benefit, alienate free account holders

The new policy, announced in late June and supposedly entering effect Monday, would introduce several changes to accounts belonging to free users of the app. They cannot have more than 1,000 users on their contact list, cannot use usernames, can only respond to up to 40 strangers’ messages a month and are limited to five quick messaging templates. If users outside of their contact list search for their phone numbers, their accounts would only show up about 40 times a month.

Previously, a free Zalo user could have up to 3,000 accounts on their friend list and there were no limitations regarding searches using phone numbers or responses to strangers’ message requests.

Zalo has introduced three pricing packages to upgrade a free account to a Zalo Business account, ranging from VND84,000 ($3.60) to VND1.65 million a month. The highest priced Elite package would allow users to have up to 5,000 friends on their contact list, allow strangers to search for users’ phone numbers up to 2,000 times a month, and allow users to respond to strangers’ message requests up to 2,000 times a month, among other functionalities.

Zalo said the new pricing schemes would help users “manage their privacy rights better.” But several users claim this is how Zalo directs users towards paid accounts under a monthly subscription model.

Some businesses say the new changes would interfere with their ability to operate.

“Because our customers cannot add us to their friend lists, we both have difficulties when one of us requires help. Customers would also not be able to access our social media posts on Zalo,” said Nguyen Hanh, owner of an online food business.

Hanh said she is willing to pay several hundreds of thousands of Vietnamese dong a month if that would allow the social media platform to help her business. However, limitations set for even paid accounts make business owners like her worried, as their operations could still be interrupted once they reach those limits.

“Imagine if a new customer messages us and we cannot respond. What will happen then?” she asked, adding she would expand operations to other platforms to reduce her dependence on Zalo.

Tuan Ha, president of Vinalink, said Zalo’s decision is “understandable.”

“Due to their large user base, even if they decide to introduce subscriptions, some are still willing to use the app,” he said. However, he believes Zalo’s approach of limiting functionalities could lose points with users.

For example, the lowest Standard pricing package that requires users to pay VND1 million a year, has no added benefits, while some existing functionalities like the ability to add people to contact lists is cut down by half compared to before the subscription model was introduced. In order to regain prior usage capabilities users would need to pay for a Pro pricing package, double the price of the Standard option.

“Many will think this is absurd. Not everyone is willing to pay that amount of money,” Tuan said.

Some of the most popular instant messaging apps in Vietnam like Messenger, Viber, Telegram and Skype are either totally free to use or provide extra functionalities with a fee. None of them limit existing functionalities for users who don’t pay.

Ha said Zalo should have used its subscription model to fix some existing app issues instead of cutting users off from the functionalities they had previously enjoyed.

“Free accounts should stay as they were. Zalo should allow subscription so users can enjoy added benefits, like permanent data storage,” he said.