Watch Out! ShanDa Is To Enter SNS Market From Internet Bar

There are so many SNS running in China, but still the opportunities are everywhere. We thought no one can possibly steal users from QQ, but 51.com did it; Xiaonei has loads of cash in pocket but Kaixin001.com suddenly became a real headache and is growing super fast beyond anyone’s expectation; If you believe the ‘wired’ SNS market is crowded, never mind, we have ‘wireless’ SNS which is relatively a virgin place, such as Tianxia. In China, SNS is hot, hot, hot!

Shanda (NASDAQ: SNDA), the leading interactive entertainment media company in China and offers a variety of internet based entertainment services such as online role playing games (Massively Multiplayer Online Role-Playing Games, or “MMORPGs”), casual games, chess and board games, network PC games, cartoons, literature, and music, is now seriously looking into SNS market, told by an insider. The big question is how they are going to do it?

Internet Bar is a very popular place for Chinese to surf Internet, especially in tier 2 and tier 3 cities. It was reported that there are over 100,000 Internet bards across China and 70 million Chinese netizen are accessing Internet from Internet bars. The figure needs to be verified, but it does tells the fact that Internet bar is a very important battle field in China web. Over 70% of Chinese Internet bars are using a management software which is offered by a Chengdu based company, Sicent Technology Co. Ltd, and Sicent was acquired by Shanda in Sept, 2003.

So here comes the story, on behalf of Shanda, Sicent is planning to launch its own SNS to compete with Xiaonei, Kaixin etc. I am not sure eventually how Sicent is going to excute it, but having the 70% market share in Internet bar business, its strategy could be really tricky and competitive!

October 29, 2008 · Filed Under China Web2, SNS

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Virtual Coins, Chinese Open Platforms Trying Monetization

How to make the money out of the Open Platform? This is probably one of the toughest questions in the global industry and there is no perfect answer to it so far. In the fast-growing Chinese web, millions of users are now willing to spend money on virtual goods, thanks to QQ and other online game operators which have developed this market for a few years. Now the SNS operators are trying to monetize their Open Platform, the solution is: Virtual Coins.

While Google is doing great job on educating Chinese web developers, 51.com, the No.2 SNS which has recently launched its own Open Platform is holding its developer event today in its office in Shanghai. The most interesting part is that, 51 will first time introduce its Virtual Coin API to its developers, which means the third-party developers (especially for those web-game developers) can take advantage of this and make some money.

Comsenz, another big player in Chinese SNS market and owner of UCHome has also implemented Virtual Coin-like API into its own open platform standard, Manyou. Kevin Day, CEO of Comsenz showed me the demo in Korea, a Manyou-compatible web-game in which you need buy virtual coins in order to power up your avatar.The money earned will be shared with Comsenz and the webmaster of UCHome.

SNS+Online Game+Open Platform, will that be a perfect combination for monetization? I think in Asia, there is a high possibility.

October 18, 2008 · Filed Under China Web2