New business models
in online communities
Benjamin Joffe
Managing Director | Plus Eight Star Ltd
Innovation in Asia?
General assumption #1

Everything from USA is   great
General assumption #2

Everything from Asia is      weird
          (and sometimes funny)
Japanese like texting on mobile




                   Because they have small fingers



Anonymous manager at a telecom c...
Asians like avatars




Because they read mangas and watch animes



              Anonymous manager at an Internet compan...
Chinese like ring-back tones




                   Because they go to karaoke a lot



Anonymous manager at a foreign med...
Giving the

wrong explanation
       to the

right question
Not-invented-here

  spiral
   of oblivion
Make fun


Oblivion               Stereo
                        type




 Self-
                      Re-invent
evident

...
Why look at Asia?
1
Because some Asian markets
are strategically important
#2 economy
#1 population
#1 digital society
Broadband connections in Japan and Korea are up to
      10 times faster than the OECD average.




                    Ja...
Consequence #1
Internet penetration and
         speed
Consequence #2
Internet literacy
2
Because some great ideas
   have already been

    proven there
2002

2005

2005
1999   2003+
How about those concepts?
           Meta-blogging
         Content scrapping
  Trust-based information sharing
 Personal ...
Alexa School of Investment



                Quiz
Global   China   Japan   South Korea
1    Yahoo!
2    Google
3    YouTube
4    MSN
5    Windows Live
6    MySpace
7    Fac...
Global       China        Japan      South Korea
1    Yahoo!                     Yahoo Japan
2    Google                  ...
Global           China          Japan    South Korea
1    Yahoo!         Baidu           Yahoo Japan    Naver
2    Google ...
Global           China          Japan    South Korea
1    Yahoo!         Baidu           Yahoo Japan    Naver
2    Google ...
SNS are a   new media
Genetics of SNS
Parameters
                Visitors                                       Personal URL
                                   ...
Q Bi: cyber $
       Secretary
           E-mail                 Multi-person chat
   Online status                       ...
Metrics
  Pageviews
Number of users
  Revenues
Social
Network
 DNA
Starting date



2004   1999   2004     1997
Active accounts




60 mln   20 mln   14 mln 300 mln
Reach (Internet users)




200 mln? 35 mln   90 mln 200 mln!
Revenues 2007 (USD)




150 mln {200 mln} 100 mln 520 mln
Operating Profit 2007 (USD)




(50 mln) {100 mln} 35 mln 224 mln
Valuation (USD)


            ?

MSSE               TSE      HKSE
15 bln?    n.a.   1.8 bln   11 bln
Main business models

     Ads             (Ads)        Ads       (Ads)

(Digital goods)   Digital goods          Digital ...
Ads or Digital goods?

1. Who is the client?

 2. Not incompatible

  3. There is more!
Other business models

        Targeted Ads
        Storage
        Monthly fee
        Personalization
        Alerts…
Key features

Invitation system
Closed/Open/Semi-closed
Sticky features
Payment solutions
Mobile
Online/Offline connection
Social design

   Focus
   Values
 Atmosphere
Demographics
Psychological design

 Identity / Identities
        Trust
The missing blocks
1
Payment infrastructure
2
Trust system
3
New value chains
To remember
1
Are you the target?
2
Resist the temptation
 to stereotype
3
Look for concepts
   Adapt the rest
Thanks!
 benjamin@plus8star.com
      Published research

              Inside Cyworld
              Inside QQ
Free sample...
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
Comparison of leading SNS
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Comparison of leading SNS

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Our presentation at Media'08 event in Sydney in March 2008. A world premiere comparing Facebook with Cyworld, Mixi and QQ. Result: Facebook is #4.

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Comparison of leading SNS

  1. 1. New business models in online communities Benjamin Joffe Managing Director | Plus Eight Star Ltd
  2. 2. Innovation in Asia?
  3. 3. General assumption #1 Everything from USA is great
  4. 4. General assumption #2 Everything from Asia is weird (and sometimes funny)
  5. 5. Japanese like texting on mobile Because they have small fingers Anonymous manager at a telecom company in 2000
  6. 6. Asians like avatars Because they read mangas and watch animes Anonymous manager at an Internet company in 2005
  7. 7. Chinese like ring-back tones Because they go to karaoke a lot Anonymous manager at a foreign media company in 2006
  8. 8. Giving the wrong explanation to the right question
  9. 9. Not-invented-here spiral of oblivion
  10. 10. Make fun Oblivion Stereo type Self- Re-invent evident Adopt
  11. 11. Why look at Asia?
  12. 12. 1 Because some Asian markets are strategically important
  13. 13. #2 economy #1 population #1 digital society
  14. 14. Broadband connections in Japan and Korea are up to 10 times faster than the OECD average. Japan also had the lowest relative monthly broadband charges/Mbps OECD Report, July 2007
  15. 15. Consequence #1 Internet penetration and speed
  16. 16. Consequence #2 Internet literacy
  17. 17. 2 Because some great ideas have already been proven there
  18. 18. 2002 2005 2005
  19. 19. 1999 2003+
  20. 20. How about those concepts? Meta-blogging Content scrapping Trust-based information sharing Personal Resource Planning (PRP)
  21. 21. Alexa School of Investment Quiz
  22. 22. Global China Japan South Korea 1 Yahoo! 2 Google 3 YouTube 4 MSN 5 Windows Live 6 MySpace 7 Facebook 8 Wikipedia 9 Hi5 10 Orkut
  23. 23. Global China Japan South Korea 1 Yahoo! Yahoo Japan 2 Google Yahoo 3 YouTube Google Japan 4 MSN Google YouTube 5 Windows Live 6 MySpace Google 7 Facebook YouTube 8 Wikipedia 9 Hi5 Yahoo Wikipedia 10 Orkut
  24. 24. Global China Japan South Korea 1 Yahoo! Baidu Yahoo Japan Naver 2 Google QQ FC2 Yahoo 3 YouTube Sina Google Japan Daum 4 MSN Google YouTube Cyworld 5 Windows Live Netease Mixi Nate 6 MySpace Taobao Rakuten Google 7 Facebook Sohu Nicovideo YouTube 8 Wikipedia Tom Livedoor Empas 9 Hi5 Yahoo Wikipedia Gmarket 10 Orkut 56.com Goo Auction
  25. 25. Global China Japan South Korea 1 Yahoo! Baidu Yahoo Japan Naver 2 Google QQ FC2 Yahoo 3 YouTube Sina Google Japan Daum 4 MSN Google YouTube Cyworld 5 Windows Live Netease Mixi Nate 6 MySpace Taobao Rakuten Google 7 Facebook Sohu Nicovideo YouTube 8 Wikipedia Tom Livedoor Empas 9 Hi5 Yahoo Wikipedia Gmarket 10 Orkut 56.com Goo Auction
  26. 26. SNS are a new media
  27. 27. Genetics of SNS
  28. 28. Parameters Visitors Personal URL These figures reflect / Add to my favorite Today / Total user’s various statistics Updated contents - Content copies Emotional (scrapping) status - Registered number as a My photo favorite Music Player Bought by user Comment Name & [Main menu] Gender Configured by user [Neighbors] View this person’s neighbors Skin [Mini-room] Comment by Purchase new skins for a Cyber residence of user neighbors coordinated background, icons, etc.
  29. 29. Q Bi: cyber $ Secretary E-mail Multi-person chat Online status Game/Music QQ buddy list SMS/MMS Weather File transfer Online disk Voice/Video Friend name: Wireless service Cathy Mini portal Ad Music Chatting with Cathy Game Cathy’s QQ Show Interaction Take a group photo with Panel admin Cathy’s QQ Show Making friends Cathy’s QQ Zone E-magazine Background Screen shoot C2C e-commerce Send pic Stock info Active emotion Address list Emotion Group list Font Last contacts My QQ Show Input area SMS Main menu Tencent browser History IPTV Chat rooms Search QQ Pet
  30. 30. Metrics Pageviews Number of users Revenues
  31. 31. Social Network DNA
  32. 32. Starting date 2004 1999 2004 1997
  33. 33. Active accounts 60 mln 20 mln 14 mln 300 mln
  34. 34. Reach (Internet users) 200 mln? 35 mln 90 mln 200 mln!
  35. 35. Revenues 2007 (USD) 150 mln {200 mln} 100 mln 520 mln
  36. 36. Operating Profit 2007 (USD) (50 mln) {100 mln} 35 mln 224 mln
  37. 37. Valuation (USD) ? MSSE TSE HKSE 15 bln? n.a. 1.8 bln 11 bln
  38. 38. Main business models Ads (Ads) Ads (Ads) (Digital goods) Digital goods Digital goods Games Mobile VAS Mobile VAS Jobs
  39. 39. Ads or Digital goods? 1. Who is the client? 2. Not incompatible 3. There is more!
  40. 40. Other business models Targeted Ads Storage Monthly fee Personalization Alerts…
  41. 41. Key features Invitation system Closed/Open/Semi-closed Sticky features Payment solutions Mobile Online/Offline connection
  42. 42. Social design Focus Values Atmosphere Demographics
  43. 43. Psychological design Identity / Identities Trust
  44. 44. The missing blocks
  45. 45. 1 Payment infrastructure
  46. 46. 2 Trust system
  47. 47. 3 New value chains
  48. 48. To remember
  49. 49. 1 Are you the target?
  50. 50. 2 Resist the temptation to stereotype
  51. 51. 3 Look for concepts Adapt the rest
  52. 52. Thanks! benjamin@plus8star.com Published research Inside Cyworld Inside QQ Free sample | www.plus8star.com
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