Econ
YouTube delays termination of Yeah1’s MCN status by 2 weeks
Last year, advertising on YouTube platform contributed 28% of total revenue and 13% of net profit of Yeah1, equivalent to VND23 billion (US$1 million).
Following the failed negotiation with YouTube that led to the termination of Vietnamese media company Yeah1 status as YouTube’s multi-channel network (MCN) partner, the initial termination date of March 31 has now been delayed by two weeks, said Yeah1 in a statement.
“Yeah1 Group and its affiliates have just been officially notified by YouTube this morning that they will delay the effect of the termination which was scheduled for March 31, 2019 by two weeks,” shared Yeah1 on April 2.
“The MCN continues to remain operational. We will update shareholders as and when additional information is received from YouTube,” it added.
Early in March, YouTube claimed SPRINGme Pte, a Thailand-based company, which is indirectly owned by Yeah1 with nearly 17%, had violated its policies regarding YouTube AdSense, the program that allows publishers on the video channel to place advertisements by third parties, which in turn generates revenue for the content provider.
Following the incident, YouTube announced that it would terminate all Content Hosting Services Agreements (CHSA) after March 31 with all Yeah1’s subsidiaries or investment companies with business activities related to YouTube Adsense.
The termination would apply to several of Yeah1’s MCN companies it has control over, such as Thailand-based SPRINGme, US-based ScaleLab, and organic Yeah1 Network.
Last year, advertising on YouTube platform contributed 28% of total revenue and 13% of net profit of Yeah1, equivalent to VND23 billion (US$1 million), stated Viet Dragon Securities Companies (VDSC).
Chairman of Yeah1 Nguyen Anh Nhuong Tong said in a statement that the company has prepared for this termination and “re-aligned its resources to focus on its owned and operated content and channel on YouTube.”
Notably, Yeah1 shares had plunged for 13 consecutive trading sessions following the incident, standing at VND95,700 (US$4.14) on March 20, down 61% from VND245,000 (US$10.60) when the incident occurred on March 1.
On the stock market, the company’s share value has showed sign of recovery recently, reaching VND102,800 (US$4.45) at the close on April 2.
This resulted in a sharp decline in the company’s market capitalization, going down from VND7.6 trillion (US$328.90 million) to current VND3.14 trillion (US$135.88 million), a loss of VND4.46 trillion (US$193.01 million).
On March 11, Yeah1 announced the decision to sell the US-based MCN ScaleLab back to its original owners for US$12 million after having acquired the latter in a deal worth US$20 million two months ago.
According to Yeah1, the divestment in the US company is aimed to protect investment capital and maximize investors’ interest.
By offloading ScaleLab, it would help the company from being affected by the Yeah1’s incident with YouTube, stated Yeah1.
Ho Chi Minh Securities Company (HSC) forecast revenue of Yeah1 in 2019 at VND1.80 trillion (US$77.71 million), down 64% compared to its previous estimation of VND2.83 trillion (US$122.18 million).
Consequently, the group’s pre-tax profit is expected to decrease by 83.3% to over VND26 billion (US$1.12 million).
Illustrative photo.
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“The MCN continues to remain operational. We will update shareholders as and when additional information is received from YouTube,” it added.
Early in March, YouTube claimed SPRINGme Pte, a Thailand-based company, which is indirectly owned by Yeah1 with nearly 17%, had violated its policies regarding YouTube AdSense, the program that allows publishers on the video channel to place advertisements by third parties, which in turn generates revenue for the content provider.
Following the incident, YouTube announced that it would terminate all Content Hosting Services Agreements (CHSA) after March 31 with all Yeah1’s subsidiaries or investment companies with business activities related to YouTube Adsense.
The termination would apply to several of Yeah1’s MCN companies it has control over, such as Thailand-based SPRINGme, US-based ScaleLab, and organic Yeah1 Network.
Last year, advertising on YouTube platform contributed 28% of total revenue and 13% of net profit of Yeah1, equivalent to VND23 billion (US$1 million), stated Viet Dragon Securities Companies (VDSC).
Chairman of Yeah1 Nguyen Anh Nhuong Tong said in a statement that the company has prepared for this termination and “re-aligned its resources to focus on its owned and operated content and channel on YouTube.”
Notably, Yeah1 shares had plunged for 13 consecutive trading sessions following the incident, standing at VND95,700 (US$4.14) on March 20, down 61% from VND245,000 (US$10.60) when the incident occurred on March 1.
On the stock market, the company’s share value has showed sign of recovery recently, reaching VND102,800 (US$4.45) at the close on April 2.
This resulted in a sharp decline in the company’s market capitalization, going down from VND7.6 trillion (US$328.90 million) to current VND3.14 trillion (US$135.88 million), a loss of VND4.46 trillion (US$193.01 million).
On March 11, Yeah1 announced the decision to sell the US-based MCN ScaleLab back to its original owners for US$12 million after having acquired the latter in a deal worth US$20 million two months ago.
According to Yeah1, the divestment in the US company is aimed to protect investment capital and maximize investors’ interest.
By offloading ScaleLab, it would help the company from being affected by the Yeah1’s incident with YouTube, stated Yeah1.
Ho Chi Minh Securities Company (HSC) forecast revenue of Yeah1 in 2019 at VND1.80 trillion (US$77.71 million), down 64% compared to its previous estimation of VND2.83 trillion (US$122.18 million).
Consequently, the group’s pre-tax profit is expected to decrease by 83.3% to over VND26 billion (US$1.12 million).
