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Contents China Internet Facts User Characteristics Excursus: BBS in China At a Glance Categories & Examples SNS in China At a Glance The Copy-Cat Issue Foreign Investment Categories & Examples Case Study: SNS n°1: Qzone About U s W eb2 A sia

China Internet Facts

User Characteristics

Excursus: BBS in China

At a Glance

Categories & Examples

SNS in China

At a Glance

The Copy-Cat Issue

Foreign Investment

Categories & Examples

Case Study: SNS n°1: Qzone

About U s

W eb2 A sia

China Internet Facts

User Characteristics 253 million Internet users (in June 2008, reported by CNNIC) 214 million broadband users 73.05 million handset mobile Internet users In 2008, worldwide most netizens are in China (USA: 223 million) Still low penetration rate: 19.1 % (USA: 71%)  High growth potential China Internet Facts

User Characteristics

253 million Internet users (in June 2008, reported by CNNIC)

214 million broadband users

73.05 million handset mobile Internet users

In 2008, worldwide most netizens are in China (USA: 223 million)

Still low penetration rate: 19.1 % (USA: 71%)  High growth potential

China Internet Facts User Characteristics

China Internet Facts  Entertainment comes first! User Characteristics

China Internet Facts Google eBay MSN Messenger YouTube Flickr Facebook Myspace LinkedIn Yahoo! Blogger Baidu Taobao QQ Youku, Tudou Yupoo, Bababian Xiaonei 51.Com, Kaixin Tianji, Wealink Sina, Sohu Blogbus etc. etc. Quiz: Who is market leader in this category? etc. Blog service Portal Business SNS Working Class SNS Student SNS Picture hosting Video hosting Instant messenger C2C eCommerce Search Engine Global player Leading player in China Type

A common excuse … Cat vs. Copy-Cat

But … Copy/Paste is not a Chinese phenomenon only… 

A quick look at Germany… vs. vs. vs.

Rest of Europe… Most popular website and SNS in Poland / 波兰最受欢迎的门户网站，同时也是当地最大的社区网站 Most popular website and Search Engine in Czech Republic 捷克最受欢迎的门户网站及搜索引擎 Largest SNS in Finland 芬兰最大的社区网站 Largest SNS in France 法国最大的社区网站 Largest SNS in Spain 西班牙最大的社区网站 Largest SNS in the Netherlands 荷兰最大的社区网站

Excursus: BBS in China

At a Glance 3,000 million registered BBS users (one netizen can register in more than one BBS) > 60% of users log on at least 3 BBS more than 3 times per week > 1,600 million total daily page view 10 million posts published every day Excursus: BBS in China Anonymity!

At a Glance

3,000 million registered BBS users (one netizen can register in more than one BBS)

> 60% of users log on at least 3 BBS more than 3 times per week

> 1,600 million total daily page view

10 million posts published every day

At a Glance 80% of Chinese sites are running their own BBS  Your company as well? BBS on various topics Discuz! the first ever social platform (BBS system) in China > 400,000 BBS sites built on Discuz! system > 70% Chinese BBS market Excursus: BBS in China

At a Glance

80% of Chinese sites are running their own BBS

 Your company as well?

BBS on various topics

Discuz! the first ever social platform (BBS system) in China

> 400,000 BBS sites built on Discuz! system

> 70% Chinese BBS market

Categories & Examples Excursus: BBS in China Sewing Machine 1.990.228 8.619 bbs.sewinginfo.com Sewing Travelling in Europe 26.378 44.800 www.go2eu.com Qiongyou Diet & Losing Weight 54.444 144.300 www.boohee.com Bohe Furniture 359.391 201.012 www.furniturebbs.com Jiaju Tongji University 28.105 234.646 bbs.tongji.net Tongji Business Forum 9.460 263.027 www.fobshanghai.com Fob Home Decoration 208.890 286.340 bbs.roomage.com Zhuangxiu Administrator Forum 5.245 322.205 www.chinaz.com Chinaz Home Appliances 16.798 508.977 www.jd-bbs.com Jiadian Auto 1.425 700.000 club.autohome.com.cn Qiche Stock Forum 6.691 1.306.691 www.55188.com Lixiang Mobile Phone 3.491 9.329.177 bbs.imobile.com.cn Shouji General 1.052 10.000.000 www.xici.net Xici General 238 20.000.000 www.tianya.cn Tianya Target Group Alexa Ranking User Number Website Name

SNS in China

At a Glance: F amous SNS in China (Quiz: Spot the „error“) SNS in China Active users! 1.564 3.000.000 www.dianping.com Dianping 13 2.493 4.000.000 www.360quan.com 360quan 12 3.421 10.000.000 www.wangyou.com Wangyou 7 9.009 9.000.000 www.baihe.com Baihe 8 6.467 22.000.000 www.ipart.cn ipartment 6 11 27.500.000 hi.baidu.com Baidu Kongjian 4 Global Alexa ranking Users in China Webpage Name 14.381 1.000.000 www.hainei.com Hainei 20 216 1.026.000 www.linkedin.com Linkedin 19 39 1.100.000 www.friendster.com Friendster 18 5 1.452.000 www.facebook.com Facebook 17 21.507 1.500.000 www.wealink.com Wealink 16 17.556 1.500.000 www.tianji.com Tianji 15 767 2.000.000 www.douban.com Douban 14 7 4.000.000 www.myspace.com Myspace 11 14.459 7.000.000 www.zhanzuo.com Zhanzuo 10 268 7.500.000 www.kaixin001.com Kaixin 9 185 25.000.000 www.xiaonei.com Xiaonei 5 539 100.000.000 www.51.com 51 3 11 110.000.000 tieba.baidu.com Baidu 2 17 341.900.000 Qzone.com.cn QQ 1

www.facebook.com www.xiaonei.com 1.45 million users in China 25 million users in China SNS in China The Copy-Cat Issue

SNS in China The Copy-Cat Issue:

SNS in China The Copy-Cat Issue: Also among Chinese SNS Recent example: www.xiaonei.com www.xiaonei001.com www.kaixin001.com www.kaixin.com “ Happy” : white collar workers “ On campus” : students

SNS in China Foreign Capital Investment in Chinese SNS: Selected Examples United Capital Investment/SIG United Capital Investment 4 n/a 2006 2004 Wealink Giant Interactive Intel/Sequoia/Redpoint Ventures/SIG Asia Investment Sequoia SIG 51 12 4 2 2008 2007 2006 2006 51 Softbank/SBI Holding/JOHO Capital General Atlantic Partners/DCM-Doll Capital Management 430 48.1 2008 2006 OPI (Xiaonei) Investors Value (USD million) Year Name

SNS in China The Copy-Cat Issue: The Difference Sales of virtual items: avatars (personalized figures) background music decorations for personal space Targeted advertising Main source of revenue Multiplayer gaming Virtual items Interactive services Special applications Entertainment Killing time Building up networks based on shared interests Objective n°1 for users Chinese SNS Western SNS

Sales of virtual items:

avatars (personalized figures)

background music

decorations for personal space

SNS in China Categories & Examples: Casual SNS: Kids/Teenagers 2.493 4.000.000 www.360quan.com 360quan 12 Global Alexa ranking Users in China Webpage Name 17 341.900.000 Qzone.com.cn QQ 1

SNS in China Categories & Examples: Vertical SNS: Students 5 1.452.000 www.facebook.com Facebook 17 Global Alexa ranking Users in China Webpage Name 14.381 1.000.000 www.hainei.com Hainei 20 14.459 7.000.000 www.zhanzuo.com Zhanzuo 10 185 25.000.000 www.xiaonei.com Xiaonei 5

SNS in China Categories & Examples: Casual SNS: Working Class /general interest 11 27.500.000 hi.baidu.com Baidu Kongjian 4 11 110.000.000 tieba.baidu.com Baidu 2 539 100.000.000 www.51.com 51 3 Global Alexa ranking Users in China Webpage Name 39 1.100.000 www.friendster.com Friendster 18 7 4.000.000 www.myspace.com Myspace 11 268 7.500.000 www.kaixin001.com Kaixin 9

SNS in China Categories & Examples: Vertical SNS: Business 104.187 1000000 www.renhe.cn Renhe 22 Global Alexa ranking Users in China Webpage Name 1.469 34.000 www.xing.com Xing 24 165.534 300.000 www.linkist.com Linkist 23 216 1.026.000 www.linkedin.com Linkedin 19 21.507 1.500.000 www.wealink.com Wealink 16 17.556 1.500.000 www.tianji.com Tianji 15

SNS in China Categories & Examples: Vertical SNS: misc. 767 2.000.000 www.douban.com Douban 14 22.456 1.000.000 www.yiqi.com Yiqi 21 etc. etc. etc. etc. 1.564 3 .000.000 www.dianping.com Dianping 13 6.467 22.000.000 www.ipart.cn ipartment 6 3.421 10.000.000 www.wangyou.com Wangyou 7 9.009 9.000.000 www.baihe.com Baihe 8 Global Alexa ranking Users in China Webpage Name

SNS in China Categories & Examples: The Future: 30 Mio. registered users Worlds largest mobile SNS HQ in Shanghai, offices in Beijing & Guangzhou Demographics: 16-25 year olds students & young professionals located in major cities Mobile SNS!

30 Mio. registered users

Worlds largest mobile SNS

HQ in Shanghai, offices in Beijing & Guangzhou

Demographics:

16-25 year olds

students & young professionals

located in major cities

SNS in China Case Study: SNS n°1: Qzone Operated by Tencent Launched in June 2005 Basic application: Personal space incl. blog, album, mini home Figures for the first half of 2008: Registered accounts: 822.2 million Active accounts: 341.9 million Total revenue: USD 442 million (estimates for end 2008: USD 1 billion) Revenue from advertising: USD 53.6 million (12% of total) Revenue from users: USD 388.4 (88% of total) Paying Internet users: 26.1 million Paying mobile users: 13.4 million Operating profit: USD 219.1 million (estimates for end 2008: USD 500 million)

Case Study: SNS n°1: Qzone

Operated by Tencent

Launched in June 2005

Basic application: Personal space incl. blog, album, mini home

Figures for the first half of 2008:

Registered accounts: 822.2 million

Active accounts: 341.9 million

Total revenue: USD 442 million (estimates for end 2008: USD 1 billion)

Revenue from advertising: USD 53.6 million (12% of total)

Revenue from users: USD 388.4 (88% of total)

Paying Internet users: 26.1 million

Paying mobile users: 13.4 million

Operating profit: USD 219.1 million (estimates for end 2008: USD 500 million)

SNS in China Case Study: SNS n°1: Qzone: Sources of Revenue Charged services: Music box, virtual items (priced RMB 1 to RMB 10) Paying Internet users: 26.1 million ARPU for paying users: > RMB 6 per month Subscription scheme: RMB 10/month for purchase of virtual items free of charge or at discount rates, premium services (large capacity online albums) > 5.2 million subscribers (i.e. 20% of paying accounts) “ Brand Qzone”: interactive marketing Qzone space for company Users can add Brand Qzone brands as online friends > 50 well known brands, including: Disney, Pepsi, KFC, Nike, Nokia, Intel

Case Study: SNS n°1: Qzone: Sources of Revenue

Charged services:

Music box, virtual items (priced RMB 1 to RMB 10)

Paying Internet users: 26.1 million

ARPU for paying users: > RMB 6 per month

Subscription scheme:

RMB 10/month for purchase of virtual items free of charge or at discount rates, premium services (large capacity online albums)

> 5.2 million subscribers (i.e. 20% of paying accounts)

“ Brand Qzone”: interactive marketing

Qzone space for company

Users can add Brand Qzone brands as online friends

> 50 well known brands, including: Disney, Pepsi, KFC, Nike, Nokia, Intel

1 Q coin = RMB 1 Case Study: SNS n°1: Qzone: Virtual items SNS in China

1 Q coin = RMB 1

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