A friend recently talked to me about his plan to launch a B2C Web site. He said he carefully studied strengths and weaknesses of prevailing business models as well as investment preferences of venture capitals (VCs). After hearing his ambitious plan and knowing his solid confidence on success, I wonder ...
Internet-related businesses are a fad in China. One shortcut, at least for the time being, to flirt with VCs is to tailor successful overseas models to the huge Chinese market. Many VCs are duped into believing transplants of Westernized business models might have high chance to win in China.
However, faddish businesses usually die quickly. Knowing about the Chinese market, such as Chinese philosophy and culture, is significant to overseas players. Consumers, competitors and potential partners are all statistical and behavioral surfaces of something deeper.
Facebook, the world's second-most used social networking Web site, which was founded in 2004 by Mark Zuckerberg, entered China in June last year with its Chinese version, zh-cn.facebook.com. Compared with its global users of 250 million, registrants to the Chinese-version Web site has been insignificant, at roughly 280,000.
Before trying Facebook in 2006 when I was in the United States, the only social networking Web site I ever used, almost a decade ago, was the domestic ChinaRen.com, which, still alive, was primitive in both Web page look and functions. I forgot my ChinaRen.com account name and password long since.
The introduction of a Chinese-language Web site was a logical step for Facebook after it had been expanded in French, German, Spanish, Italian, Japanese and even Catalan. But the Chinese-edition Facebook was to compete with a swath of domestic social networking services: Xiaonei.com, 51.com, Hainei.com and the also Chinese-version of MySpace.
Almost copying Facebook's Web page design, Xiaonei.com followed the exact growth path of the U.S. online social networking community. With no relation to Facebook, Xiaonei.com created a stronghold among more than 20 million college students in China. It tries to extend itself to 85 million people with a college education or higher, 90 percent of whom are linked to the Internet, according to a China Internet Network Information Center (CNNIC) survey.
The CNNIC last week said China had 338 million Internet users by July, overtaking the U.S. as the world's most netizen-populated country. The Internet popularity in China was 25.5 percent over the world's average. The International Telecommunication Union (ITU) defines an Internet user as someone aged at least two years old who went online in the past 30 days. The U.S. definition of Internet users is people three years or older who use at least one Internet application other than e-mail. The CNNIC, meanwhile, includes people aged older than five who use Internet in the past six months as Internet users.
Why do I think Facebook and its foreign-born likes would have gloomy prospects in China? It's not because Facebook is faced with fierce competition. It's because the primary purpose of the majority of Chinese Internet users is to find entertainment from the Web. The Internet in China has not yet seen an expansion of real social networks.
People play games, see movies, write blogs and chat for fun. The entertainment function of the Internet is first and foremost while the social networking is largely ignored. Chinese Internet users usually find no fun in just connecting with their friends, colleagues and classmates.
Unlike Americans and Europeans, most Chinese prefer mobile text exchange for real networking due to the long profits-seeking policy of state-run service providers that charged two-way telecommunications. If compared with expensive rates for calling or receiving calls, expense for each mobile text was by and large nominal, at ten cents (1.5 U.S.cents). The Chinese culture of heavy use of mobile text messaging has been carried on to the Internet.
Instant messaging tools such as Tencent QQ (ICQ), MSN and now Fetion, a new service provided by the country's mobile telecommunication giant China Mobile, can satisfy most of social networking needs. A comparative successful social networking Web site Q-zone, deriving from QQ, announced to have 170 million active members by March 2008. QQ is known for its expansive lists of contacts, not necessarily people known to each other before.
No Web sites could remain attractive to users without constantly offering new features. Both Google and Facebook are adept at it. But new features warmly welcome in overseas markets might not get similar feedback in China. Web sites in the Chinese market need tools and software developers who really understand this market and consumers' behavior. No such support groups are at hand.
One key merit of Facebook is the use of real names. You can choose to use fake names, but in that way, you help disable the powerful search function of Facebook. One incentive to using a real name is a person's assumption that the online social networking is essential and useful, the same as what the person gets from real life networking.
Few in China feel online social networking something serious. For people who expect to date others or have casual encounters, don't bother to log on Facebook, which is now rumored to look for indigenous business partners.
(Xinhua News Agency July 25, 2009)
