Social Networking(s)




 Benjamin Joffe | CEO, Plus Eight Star
China Internet Forum, Beijing | 2009.11
Introduction
Benjamin Joffe
   本杰明
 ベンジャミン
   벤자민
4 years

          1 year
                   4 years
Consulting | Startups | Community
| Plus Eight Star
• “Innovation Arbitrage”
     • Internet & Mobile Digital strategy
     • Best practices from China, Japan & Korea


• Published reports
     • Inside Cyworld (2007)
     • Inside Tencent (2009)
     • Inside Alibaba (upcoming)


• Contact
  • info@plus8star.com
References

EUROPE                  USA




                 ASIA
References

EUROPE                  USA




                 ASIA
Work With Startups: Cmune

• Making the 3D Web happen

  –   fbFund winner
  –   First 3D FPS game on Facebook
  –   #1 Widget on Apple.com
  –   Virtual Goods

• Check it out!
  – www.cmune.com
Most Advanced 3D Game on Facebook
        Paradise Paintball by Cmune
     http://apps.facebook.com/paradisepaintball/




    Disclosure: I am an investor & partner of Cmune
Mobile Monday Beijing


   31 events
  111 speakers
3,500 members
1,500 companies
Mobile Monday Beijing


   31 events
  111 speakers
3,500 members
1,500 companies
Social Networking(s)
Quiz! Who is on…

•   Facebook
•   QQ / Q Zone
•   RenRen / Xiaonei
•   Kaixin001
•   Twitter
•   A matchmaking site?
What is a social network?
Social Networking(s)

•   Users         Demographics / Geography
•   Identity      Real-name / Nickname
•   Openness      Closed / Walled Garden / Open
•   Platform      Web / Mobile / Cross-platform
•   Revenue mix   Ads / Virtual Goods / Games
•   Results       Profitability
Confused? It’s ok!
• Everything is converging!

  – Social Networks
  – Blogs
  – Online Media
  – Games
  – Virtual Worlds
I don’t know what is a SNS but…

• There are numerous best practices to leverage
  – From each service category
  – From each specific service


• Who do you benchmark?
Ideas from Japan
Revenue vs. Profit (2008)
                70%
                60%
                50%
Profit Margin




                40%
                30%
                20%
                10%
                0%
                      0   200   400       600       800   1,000   1,200
                                      Million USD
Mobile Game Town
Source: DeNA
Gree
Advertising

Gree Home                     Advertising &
                              Affiliates | 25%

            Avatars & items



                              B2C virtual
            Games             goods | 75%
                              60% avatars
                              40% games
Mixi
Mobile Open Platforms
                       Mixi: Oct 27, 2009

   – 39 mobile applications released – mostly games




City Building     Harvest Moon      Shopkeeper       Furauni
By Liveware        By Liveware    By Geisha Tokyo   By Konami
Some Numbers
Sharks with Laser Beams vs. Irritated Sea Bass
              Asia’s Virtual Goods Market Estimate for 2009




Asia: 7 Billion Dollars!
USA: $1 bln (Source: Inside Virtual Goods, Oct 2009)
Chinese Online Games Companies
• Listed on NASDAQ
     •   NETEASE             NTES   $4.82B
     •   SHANDA              SNDA   $3.11B
     •   SHANDA GAMES        GAME   $2.75B
     •   PERFECT WORLD       PWRD   $2.25B
     •   CHANGYOU            CYOU   $1.65B
     •   GIANT INTERACTIVE   GA     $1.71B


• Listed on HKSE
     • TENCENT               3888   $34.3B
     • NET DRAGON            0777   $0.34B
     • KINGSOFT              0700   $1.07B
Chinese Online Games vs. ROW
• And the total is…
     • 8 Gaming Companies      $17.7 B
     • Tencent                 $34.3B
     • TOTAL                   $52.0B


• Comparables
     •   Activision Blizzard   $14.1B
     •   Electronic Arts       $6.05B
     •   Ubisoft               $1.56B
     •   Take Two              $0.94B
     •   TOTAL                 $22.6B
Chinese Online Games vs. ROW
• And the total is…
     • 8 Gaming Companies      $17.7 B
     • Tencent                 $34.3B
     • TOTAL                   $52.0B


• Comparables
     •   Activision Blizzard   $14.1B
     •   Electronic Arts       $6.05B
     •   Ubisoft               $1.56B
     •   Take Two              $0.94B
     •   TOTAL                 $22.6B
Chinese Online Games vs. ROW
• And the total is…
     • 8 Gaming Companies           $17.7 B
     • Tencent                      $34.3B
     • TOTAL                        $52.0B


• Comparables

      eBay            Time-Warner             Yahoo
      $31B               $38B                 $23B
Japanese SNS

• Mixi       $1.1 billion

• DeNA       $2.0 billion

• GREE       $2.2 billion
EA acquires Playfish
($300 mln + $100 mln option)
Social Games Going West
• Facebook Developers: Low Entry Barrier!

  Rank     Company          Apps       Location

  #7       6 Waves          104 apps   Hong Kong
  #30      Rekoo            2 apps     Beijing
  #36      Elex             7 apps     Beijing
  #229     Tyler Projects   1 app      Singapore


• Strong in China & entering Russia, Japan, etc.
Social Games Going East Too?
Quotes from Elex

• High productivity
  – “Anyone is able to develop social games at
    Playfish level”


• 12 languages versions
  – “We can localize our game in different language
    versions in 1 day”
Evolutions?
Evolutions
3D Social Games? Cross-Platform Games?




                              Artist’s view of
                             3D Farming Game
Virtual Currencies in any
              Online Media
• HoopChina
                           PORTAL       ONLINE STORE

  – Basket-Ball vertical
  – 90% UGC
  – E-commerce
  – Virtual currency
    “CA” (for “calorie”)            WEB GAMES
    earned via activity
  – Web games
Panel Discussion
Panel Discussion
• Panelists

  –   Allen WANG     CEO         BabyTree
  –   Yu Wang        Founder     P1.CN
  –   Allen ZHU      Partner     GSR Ventures
  –   Qian LIU       VP of BD    KaiXin001
  –   Felix YANG     President   Beijing IWOM
                                 Marketing & Planning

• Moderator

  – Benjamin Joffe   CEO         Plus Eight Star
Thanks!
   More about “Innovation Arbitrage”

www.plus8star.com

benjamin@plus8star.com
                                       +81 | Japan

benjamin0123                           +82 | Korea

                                       +86 | China
http://twitter.com/plus8star
                                    Telecom & Internet

www.linkedin.com/in/benjaminjoffe     + Added Value

                                      * High quality
www.slideshare.net/plus8star

Social Networking(s)

  • 1.
    Social Networking(s) BenjaminJoffe | CEO, Plus Eight Star China Internet Forum, Beijing | 2009.11
  • 2.
  • 3.
    Benjamin Joffe 本杰明 ベンジャミン 벤자민
  • 5.
    4 years 1 year 4 years
  • 6.
  • 7.
    | Plus EightStar • “Innovation Arbitrage” • Internet & Mobile Digital strategy • Best practices from China, Japan & Korea • Published reports • Inside Cyworld (2007) • Inside Tencent (2009) • Inside Alibaba (upcoming) • Contact • info@plus8star.com
  • 8.
  • 9.
  • 10.
    Work With Startups:Cmune • Making the 3D Web happen – fbFund winner – First 3D FPS game on Facebook – #1 Widget on Apple.com – Virtual Goods • Check it out! – www.cmune.com
  • 11.
    Most Advanced 3DGame on Facebook Paradise Paintball by Cmune http://apps.facebook.com/paradisepaintball/ Disclosure: I am an investor & partner of Cmune
  • 12.
    Mobile Monday Beijing 31 events 111 speakers 3,500 members 1,500 companies
  • 13.
    Mobile Monday Beijing 31 events 111 speakers 3,500 members 1,500 companies
  • 14.
  • 15.
    Quiz! Who ison… • Facebook • QQ / Q Zone • RenRen / Xiaonei • Kaixin001 • Twitter • A matchmaking site?
  • 16.
    What is asocial network?
  • 19.
    Social Networking(s) • Users Demographics / Geography • Identity Real-name / Nickname • Openness Closed / Walled Garden / Open • Platform Web / Mobile / Cross-platform • Revenue mix Ads / Virtual Goods / Games • Results Profitability
  • 20.
    Confused? It’s ok! •Everything is converging! – Social Networks – Blogs – Online Media – Games – Virtual Worlds
  • 21.
    I don’t knowwhat is a SNS but… • There are numerous best practices to leverage – From each service category – From each specific service • Who do you benchmark?
  • 22.
  • 23.
    Revenue vs. Profit(2008) 70% 60% 50% Profit Margin 40% 30% 20% 10% 0% 0 200 400 600 800 1,000 1,200 Million USD
  • 24.
  • 25.
  • 26.
  • 27.
    Advertising Gree Home Advertising & Affiliates | 25% Avatars & items B2C virtual Games goods | 75% 60% avatars 40% games
  • 31.
  • 32.
    Mobile Open Platforms Mixi: Oct 27, 2009 – 39 mobile applications released – mostly games City Building Harvest Moon Shopkeeper Furauni By Liveware By Liveware By Geisha Tokyo By Konami
  • 33.
  • 34.
    Sharks with LaserBeams vs. Irritated Sea Bass Asia’s Virtual Goods Market Estimate for 2009 Asia: 7 Billion Dollars! USA: $1 bln (Source: Inside Virtual Goods, Oct 2009)
  • 35.
    Chinese Online GamesCompanies • Listed on NASDAQ • NETEASE NTES $4.82B • SHANDA SNDA $3.11B • SHANDA GAMES GAME $2.75B • PERFECT WORLD PWRD $2.25B • CHANGYOU CYOU $1.65B • GIANT INTERACTIVE GA $1.71B • Listed on HKSE • TENCENT 3888 $34.3B • NET DRAGON 0777 $0.34B • KINGSOFT 0700 $1.07B
  • 36.
    Chinese Online Gamesvs. ROW • And the total is… • 8 Gaming Companies $17.7 B • Tencent $34.3B • TOTAL $52.0B • Comparables • Activision Blizzard $14.1B • Electronic Arts $6.05B • Ubisoft $1.56B • Take Two $0.94B • TOTAL $22.6B
  • 37.
    Chinese Online Gamesvs. ROW • And the total is… • 8 Gaming Companies $17.7 B • Tencent $34.3B • TOTAL $52.0B • Comparables • Activision Blizzard $14.1B • Electronic Arts $6.05B • Ubisoft $1.56B • Take Two $0.94B • TOTAL $22.6B
  • 38.
    Chinese Online Gamesvs. ROW • And the total is… • 8 Gaming Companies $17.7 B • Tencent $34.3B • TOTAL $52.0B • Comparables eBay Time-Warner Yahoo $31B $38B $23B
  • 39.
    Japanese SNS • Mixi $1.1 billion • DeNA $2.0 billion • GREE $2.2 billion
  • 40.
  • 41.
    ($300 mln +$100 mln option)
  • 42.
    Social Games GoingWest • Facebook Developers: Low Entry Barrier! Rank Company Apps Location #7 6 Waves 104 apps Hong Kong #30 Rekoo 2 apps Beijing #36 Elex 7 apps Beijing #229 Tyler Projects 1 app Singapore • Strong in China & entering Russia, Japan, etc.
  • 43.
  • 44.
    Quotes from Elex •High productivity – “Anyone is able to develop social games at Playfish level” • 12 languages versions – “We can localize our game in different language versions in 1 day”
  • 45.
  • 46.
    Evolutions 3D Social Games?Cross-Platform Games? Artist’s view of 3D Farming Game
  • 47.
    Virtual Currencies inany Online Media • HoopChina PORTAL ONLINE STORE – Basket-Ball vertical – 90% UGC – E-commerce – Virtual currency “CA” (for “calorie”) WEB GAMES earned via activity – Web games
  • 48.
  • 49.
    Panel Discussion • Panelists – Allen WANG CEO BabyTree – Yu Wang Founder P1.CN – Allen ZHU Partner GSR Ventures – Qian LIU VP of BD KaiXin001 – Felix YANG President Beijing IWOM Marketing & Planning • Moderator – Benjamin Joffe CEO Plus Eight Star
  • 50.
    Thanks! More about “Innovation Arbitrage” www.plus8star.com benjamin@plus8star.com +81 | Japan benjamin0123 +82 | Korea +86 | China http://twitter.com/plus8star Telecom & Internet www.linkedin.com/in/benjaminjoffe + Added Value * High quality www.slideshare.net/plus8star