Messenger @ MindSay

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Summer Accomplishments:
- Completed band career 100% - (GH: Greatest Hits)

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Today's actually been better than I expected. :)
I couldn't get to Ashleigh's because of dad's dodgy shifts, so she came here instead.

Before she came though, mam was in my room on my computer writing AN ANGRY COMPLAINT LETTER.
She bought these red towels from Next - and they're a nice colour and quite soft, they just have a tendancy to cover everywhere in a layer of red fluff. You can't even dry yourself with them without getting covered in random moutled bits.

So she went onto the Next website and started writing out this e-mail to them.
I read it over so I could correct her spelling and grammar errors.
(She just doesn't know how to get a CAPITAL I....)

It was so bloody funny though - she even slagged off Primark by saying summat along the lines of: "OH MURR, IF I'D GOT THEM FROM PRIMARK I'D EXPECT SHODDY QUALITY."

Then she twisted the truth. I AM asthmatic - but when she said: "AND MY ASTHMATIC DAUGHTER CANNOT EVEN USE THE TOWELS" - that's bending it a bit too far. :)

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Ashleigh brought her slider-panel Metallica guitar with her today.
Nice one - we were both using guitars we were comfortable with.

I didn't feel at my strongest, so I played on Hard instead of Expert.
I still did lead though - Ash went on bass.

We managed to complete the entire career - from the end of level 2 (as Shelly and I had done the first few songs on Wednesday) right up to the TTFAF finale on level 8.

And we didn't get a single three star!
It's five stars all the way with the odd four star on the dodgy songs.

Christ, Beast & The Harlot - I almost got 100% on it.
And I only didn't because of a few silly errors.
AND IT'S ON LEVEL SEVEN.

I KNOW I can FC that - I'm gonna give it a go soon. :)

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It's weird - when I'm playing GH WITH someone - I can talk to them.
When someone's watching me - I can't. It puts me off something chronic.

So as we spent these few glorious hours sitting together on my bed, drinking Pepsi, eating Pom-Bears and playing GH: Greatest Hits - we held many-a random conversation. :)

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Ash is so cute. :)

When I was downstairs, making our food - she shouts: "Dixie....!"
I go: "...What Ash?"
She goes: "...Come heeeeeeere...!"
I go up, get to the bathroom and say: "What is it, Ash?"
She mumbles: "I need one of your paaaads..."

I actually didn't laugh at her - I could see she was embarrassed - so I went and got her one. Graciously. :)

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I made us both hot-dogs for our tea.
We sat outside in the back garden on the pub bench.
It was sunny, but we get a lot of shade in our garden because of Wendy's beasty tree in the garden next door.

It was quite soothing - especially since we were sat by the lavender bushes.
Lavender makes me super-relaxed and calm. :)

I had three hot-dogs - two with cheese, one without.
Ash had three hot-dogs, one with cheese, two without, all with ketchup.

Then I offered her one of the RANDOM CHOCOLATE BALLS.

Mam came in the other day and said: "Oh, there's some chocolate cake things in the fridge."
They're like little cups of chocolate sponge cake with chocolate icing, chocolate sauce in the middle and chocolate chips on the top. They're fucking nectar - and Ash agreed. :)

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When we'd eaten, we went back to Guitar Hero.
We went on to Quickplay - as I'd got the urge to go on vocals.

I wanted to prove to Ash how hard it was for me to get 5 stars on Them Bones playing Expert vocals.
Simply because my voice is too high and there's a few lines that I can't sing.

I only went and fucking got FIVE.
Seriously, you try and prove you CAN'T do something, and you CAN...

I also sang Cult Of Personality (on request by Ash, because she likes it) and Play With Me.
Shelly told me to see if Ash could pass it on Hard lead guitar. She did - she didn't fail that epically. She got about 89%.

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The most amusing moment of today was definatley TTFAF. :)

Ash was complaing about how easy it was on bass when we played it during the career.
So I suggested she play it on guitar while I sing it.

I was singing the chorus with varying voices and octaves - I went from Princess Peach to a random cave ogre, to a bloke with a snotty nose to a lopsided dwarf - then I'd SQUEAL.
Ash was in absolute fits. :)

Not only that - but Ash seemed to be scraping her way through it - so when I had no lyrics to sing, I was making up my own to the tune of the song, regarding Ash's current performances.

And it was SO exact! It was super-spontaneous, but it fitted to the lyrics so well.
Just imagine this to the tune of TTFAF:

I fail at hammer-ons,
I fail at slider notes,
I fail at open strums,
I fail at GENERAL strums,
I fail at orange,
I fail at blu-uuu-ue!
I fail at green-red-YELLOOOOOOOOW!!!

I fail at whammy bar,
I fail at star power,
I fail all the tiiiiiiii-iiime!!

No wonder Ash was failing - she was doubled up laughing half the time. :)

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I got Ash laughing again after this - we went on YouTube and watched some videos in my favourites.

Just like Lewis did, she was pissing herself at Brookers' Harry Potter parody video.
Along with the "Hello DAVE!" video, random CassetteBoy videos and YouTube poops.

I even showed her Give Me Back My Spleen - the video that Ashley Robson and the knobhead boys made in year 11.
I have nothing against Ashley, Garrie, Lamby or Foxon - but the rest of them were absolute dickheads.

Ash was just amused at how bad it was. :)

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And before Ash left - we spent a while discussing DATWBSVOH. :)
She gave me some more ideas, and inspired me of a way to unstick myself.

I'm currently stuck at a section where the two main rivals are arguing and insulting each other - and I wasn't sure on how to end it.
I've decided that Andrew Eagle is going to twist Ashleigh Sparrow's wrist back over on itself, making her cry, almost.

I tested this move on the real Ashleigh - so I could document her reaction to it.
Her voice went proper high. :D

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I've spent a lot of time tonight on MSN, talking to Kyle and Adam.

I really need to talk to Kyle more often.
He's matured a lot - he's not once said something stupid in the past few days.
I've got him interested in the Backloggery, and he's made an account on it.

We spend a lot of time discussing games, mainly.

We were both shocked and amused when Kyle asked me who the most annoying character in video game history was.
We both typed our answer simultaneously - Ashley Graham from Resident Evil 4. :)

With Adam - he's just being Adam.
Getting drunk on Peach schnapps while we both sent each other YouTube links to Countdown bloopers. :D

I see the light of hope: this could be used to have people subscribe to newsletter.

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[+] Another way to replace email marketing

 

When email becomes a very unreliable communication tool, is there any effective way to distribute information besides RSS? Look into your daily life, are there any other common communication tools?

 

You may immediately think of Instant Messenger (IM). Yes, in this prospering Internet age, everyone has at least one IM open on his desktop. In some sense, the use of IM even has replaced email.

 

Just think, if you can inform your clients via MSN Messenger or Yahoo! Messenger as soon as your website has new products or new services to be released. It could be much more efficient than email or RSS.

 

For emails and RSS, they have to wait for people to receive them. However, if you send information through IM, a message box will pop up directly on the user's desktop. Normally, people will take a glance at the IM message that pops up while leaving email unread for a while.

 

In August 2006, when I was thinking hard about the alternative solution to the newsletter marketing, MSN Messenger came up to his mind very soon. Almost every white collar was using it, and the user group was pretty much the same with that of Digital Wall. I then started to look for a feasible plan.

 

[+] The possibility to use MSN Bot

 

The most awkward way is to register an MSN Messenger account and ask the newsletter subscriber to add this account into his MSN Messenger contact list. Each time the website is updated, messages with the URL of new articles will be sent to those readers.

 

But that will bring about several problems: 1) Obviously, the messenger contact list is going to be extremely long. I have over 140,000 readers. But what is the maximum number of contacts Microsoft allows? It is not possible there is no such a limit, isn't it? 2) It's never going to happen to send IM messages to readers manually! How much time will that costs! 3) If I send out thousands of notification messages to subscribers within a certain period of time, how could it be possible that Microsoft's servers would not block me as a spam message publisher?

 

Many people may know that such kind of IM has robots, so does MSN Messenger, which is called 'MSN Bot'. MSN Bot is actually a program-controlled account. You may chat with it after you add such account into your own MSN Messenger contact list.

 

Some MSN Bots have rich functions. For example, if you ask it an English word, it will give the translation in other language. And some other MSN Bots can do map searching, etc.

 

Microsoft also encourages the development of Bot. If you are interested, you can take a look at this interesting MSN Bot developing contest:

 

https://www.robotinvaders.com/main/Default.aspx

 

I see the light of hope: this could be used to have people subscribe to newsletter.

 

[+] Limitations by using MSN Bot

 

Website operators can release MSN Messenger accounts which are actually MSN Bot programs. Subscribers then add that kind of account to their MSN Messengers. Message publishing is accomplished by sending messages to everyone's IM by the program.

 

However, that solution is not perfect. Microsoft still blocks large amount of message publishing. Sending messages separately in separate hours may be a way to get around. However, problems still exist when the number of readers is huge, because it might be a week later when the last reader receives the message.

 

It then comes to my mind that, would logon notification work instead of IM message publishing? As we all know that MSN Messenger will give out notification when contacts log on. Therefore, as long as operators set up logon and logoff time schedules for the MSN Bot, subscribers will be notified automatically.

 

The effect is much worse than sending messages directly. Since Microsoft still has maximum limit on the number of contacts, this method is not suitable for the case of large number of subscribers. If those limitations could not be solved, this method will be restricted.

 

It is still possible to get around the limitations posted on the amount of MSN message publishing and the number of contacts. In fact, Microsoft has special authorized enterprises across the globe. As long as operators pay them for sending large number of messages, those limitations could be overcome. However, small websites need cheaper solutions.

 

[+] The twilight for IM marketing

 

Either developing MSN Bot or paying for sending messages is beyond the capability of ordinary website operators. At least the cost is much higher than the relatively low-cost email marketing. However, the situation is changed with the advent of Microsoft Windows Live Alerts.

 

This service is for the content subscription service through Windows Live Messenger (the former MSN Messenger). For example, the user will be informed by the Messenger when MSNBC news is updated.

 

Windows Live Alerts：http://alerts.live.com

 

Subscribers can set up time slots to keep from beiing disturbed by messages during work. They can also set messages to be forwarded automatically to their email boxes when they're offline. Finally, the role of IM has been shifted from a communication tool to a content publishing tool.

 

If you are a content provider, you can apply to become a Microsoft content publisher in order to be assigned a unique subscription URL. By simply clicking the URL, users will get into the subscription process and receive messages from you.

 

The instructions for how to become a content publisher can be found at: http://signup.alerts.live.com

 

This service is still on test. Therefore, all applications are sent to the U.S. headquarters. Processing one application needs a little time. It's not known yet whether there is any limit for the number of subscribers allowed for individual content providers.

 

[+] The Fourth Generation of Internet marketing: Rights in the users' hands

 

We can imagine that content subscription through IM will increase rapidly. We are more excited to see that Internet companies have opened such platform for website or Blog operators. IM will become the channel for the new generation of content aggregation and publishing.

 

If you run an eCommerce site, as long as people are willing to subscribe to your Windows Live Alerts, why not sending out discount information through this channel? Of course, it will become more competitive because every website runner can send messages to Internet users through it.

 

Internet marketing has evolved to its fourth generation with RSS and IM subscription as the major tools. We should keep in mind that from the first to the fourth generation, the power of choice has been gradually transferred to Internet users' hands, and that is an everlasting marketing law in the Internet age. ( 2007/01/07 - By Digitalwall.com - Way to China Internet/Telecom )

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- Read More

Prev : The Fourth Generation of Internet Marketing (2) RSS Tracking
Next : The Mist of 3G in China (1) 3G Makes No Profit

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- Today in History

Web 2.0 Finale (3) Finally blended in Web 1.0 - 2008/01/06

The Fourth Generation of Internet Marketing (3) IM Marketing - 2007/01/07

Compete against the leader with further customer segmentation in the crowded market.

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[+] The income from the coummunication service nurtures a community

 

Today, online communication services mainly include the earliest services, such as email and instant messenger (e.g., QQ and MSN), and the follow-on VoIP messenger (e.g. Skype) and P2P file transmission (e.g. BitTorrent).

 

When we review the figure raised by me which shows the community profit model, we can see that, in addition to the advertisement, the communication service revenue is also a key component of the Web 2.0 profit model.

 

 

Some companies started their business with free communication services and made profits from community services later. For example, Tencent QQ, the number one instant messenger service provider in China, develops its business operation from the right circle of the above figure to the left one, while those who ran free community services at the beginning have to depend on communication services, for example, the wireless value added service like SMS to make a profit. In this case, their business moves form the left to the right of the above figure.

 

From communication to community, or the other way round, it seems that those are two conflicting concepts. As a matter of fact, there is no conflict at all. The key lies in the “heavy user” I mentioned in previous sections. Users of the community service must be the heavy users of the communication service.

 

[+] Iron rules for the profitability of the communication and community service

 

Most QQ users, as instant messenger service subscribers, do not want to pay. Yet those who are willing to do so are just in its communities. The purpose of QQ Show, a community service based on QQ subscribers, sells virtual items to those heavy users. In other words, the iron rule for the profitability of the Internet-based communication and community service is:

 

“A% of the users of the communication service (most of them use the service to communicate with acquaintances) use the community service (and are willing to communicate with strangers), while B% are willing to pay for a greater rights to show themselves, including buying the larger storage, virtual items and wireless value added service.”

 

For both the communication service (among acquaintances) and community service (among strangers), there is another possible profit model: VoIP. For services like QQ, the VoIP service call to a landline of mobile phone could prove to be a revenue source just like Skype, although the policy in China is still not clear at the present time.

 

For community services, the simplest profit model is making friends via VoIP service. It is a brand new field, where a lot of models could be tried. For example, eBay, which has merged Skype, is trying to introduce the VoIP service into its auction service. To make profits out of VoIP services will become an important trend for community services.

 

[+] Unshakable leadership of QQ

 

Compared with the community service market, where numerous Web 2.0 companies are involved in the fierce competition, the instant messaging service sector has another landscape: the leader is far too strong to be shaken. The following figure shows the market share of the leading instant messenger commonly used in China.

 

 

With its admirable achievements during the recent years, Tencent QQ has proved to be unshakable, leading MSN Messenger, even the nearest competitor, by miles. It is remarkable that China’s Internet market is still witnessing fast growth of the subscriber number; therefore QQ has far better ability to attract new users than its peers obviously.

 

It is a characteristic of the instant messenger. Most users will follow their friends or acquaintances to choose the same instant messenger, producing a “Member Gets Member" effect. Eventually, the strong gets stronger.

 

However, the so-called “friends and acquaintances” is only a relative term. An Internet user might get into an environment, for example, the office where all those around use MSN Messenger, instead of QQ. In fact, MSN has been a favorable tool for office workers. Maybe that could be an opportunity.

 

[+] Instant messenger for making friends

 

The following figure lists the purpose of using instant messenger. Notably, 83.8% of the users use the service to communicate with friends and family members, proving my statement that “the communication service is used mostly among acquaintances.” That turns out to be an unshakable advantage for QQ, as most of the acquaintances of a person are using it.

 

 

Then there are 61.6% of the users use the service for job-related communications, which is the base of MSN, as well as a field that Tencent is trying to infiltrate. Although the proportion of QQ-loving young students has been on the rise during the recent years, they will get a job sooner or later, and then they would switch to MSN. That is an intolerable loss for Tencent.

 

Surprisingly, as many as 42.3% of the users wish to make new friends, i.e., get to know strangers through instant messenger. Let us ask ourselves this: among the 10-plus instant messenger brands, which one has the most powerful ability to “enable users to make new friends fast”?

 

If the answer is still QQ, it would render QQ almost invincible! If the answer is not so definite, there might be room for those instant messenger which position themselves as a “powerful friends-making tool” in this market. Let us wait and see which one will be the best.

 

[+] Compete against market leader with new market positioning.

 

We should not forget what we have discussed at the very beginning of this series: there is still a growth room of 60 million subscribers expected in China’s Internet market, for which every Internet company is posed to take a bite. What, then, is the profile of that group? My simple answer is: female subscribers.

 

 

Male subscribers have been the dominating force of the Internet market in China. However, with the saturation of the market, the proportion of female users will rise. Companies that cater for the taste of female subscribers (who have particular preference for beautifulness, artistic conception and feeling) will be able to control the steering wheel in the next round of development.

 

 

The market positioning, be it “special for office”, “special for making friends” or “special for lady”, is just an attempt to compete against the market leader through re-segmentation. The previous problem with the instant messenger market is the over-similarity of the functional positioning of every brand, which leaves users little impulse to change their service providers.

 

 

Besides, we can see that 42% of the IM users use the service to save their phone tolls. Obviously, to save the long-distance phone call expense is a great enticement and great enough for IM venders to add in the VoIP functionality.

 

[+] A large user base could be the core competence.

 

When Microsoft starts to beef up its MSN Messenger in China and Google announces its strategy to stride into this market by relying on Google Talk, Tencent start from a IM service provider, is continuing along its path of diversification to dig deeper in the fields of online game, eCommerce and even portal website.

 

Maybe the question should be asked this way: “if you were Ma Huateng, the CEO of Tencent, held 400 million QQ users in your hand, what would you do? Would you just let them chat to death?” For me, the answer is self-evident. I do not think there is anything wrong with Tencent’s diversification.

 

In the contrary, as I have stressed repeatedly, community service users are heavy users. Please remember it! Thanks to that characteristics, QQ users have greater interests in shopping, are more deeply addicted to online games and show higher usage rates of other online services than general Internet users.

 

 

From another viewpoint, we can see that, it is because of its huge user base that Tencent has been able to surpass the original leaders in many fields in the shortest time possible. When QQ is no longer the synonym of the instant messenger alone, the leadership of Tecent will be extremely hard to shake. ( 2006/04/23 - By Digitalwall.com - Way to China Internet/Telecom )

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- Read More

Prev : Predictions on China Internet Market (7) Web 2.0 Economy
Next : New Era of Online Advertising (1) from Media to Channels

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- Today in History

The Mist of 3G in China (4) The Way to Survival for SP - 2007/04/22

Predictions on China Internet Market (8) War of Instant Messenger - 2006/04/23

3G Time Comes (7) 3G Is Nothing to Do with WLAN - 2003/04/27

3G Time Comes (6) Phones Don't Need to Be Smart - 2003/04/20

Ultimately speaking, the community service is just a show business.

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[+] The relation between the content and community

 

In the previous sections, we have discussed the first pillar of the Internet: content. Now we are going to talk about another two pillars: community and communication. Before we start, it is necessary to get a clear view on the relations between the three pillars.

 

First of all, reading (or watching or browsing) is one of the most fundamental activities of human beings. It is also what most Internet users do. Because of the massive information volume, there is a requirement for searching ability to get what one needs rapidly. Most people are just readers.

 

The "a-few-elites-write-for-the-mass-readers" model of the traditional media and even the so-called Web 1.0 web sites is changing along with the development of the Internet. Photos, articles and other kind of contents that users create and offer to share in chat rooms, forums and even blogs are known as new emerging contents.

 

However, even on the so-called Web 2.0 websites, which are known for the interaction among users, the model of "a few people writing for the mass readers" has not changed substantially. Only the "a few people" of the Web 1.0 era has increased many times for now. After all, only a small portion of people would take the trouble to create things or initiate interaction with others.

 

[+] The first step to initiate interactions: Have good writers create good contents

 

Reflected in the CNNIC annual reports on China's Internet market over the years, it is not hard to find that, among Internet applications, data searching and online news reading have always maintained heavier weights than community services, including the forum/BBS, chat room and blog.

 

 

Obviously, human beings are not active participants of interaction by nature. We cannot expect everybody to write his/her blog. A simple truth is that there are always less blog writers than blog readers. Therefore, the first step and key to trigger interactions is to have good writers create good contents.

 

Recruiting, training and retaining good writers are critical to the quality of community services, and will affect the pageviews and the subsequent advertising revenue. Suddenly, it gets crystal clear that the so-called Web 2.0 web sites need to be aware that they are doing business with minority groups on the Internet.

 

By providing contents and search services, portals do business with the majority, while the so-called web 2.0 web sites deal with the minority. One is expanding wider, while the other digging deeper. Both can survive and co-exist so long as the market is large enough, for both reading and interaction are the needs of human beings. The difference is only the number of users: the need of reading is stronger than interaction.

 

[+] The relation between communication and community

 

The interpersonal communication has been a demand since ancient time. In the Internet time, the most frequently used tool is email. Later, there appeared IM (instant messenger) applications such as ICQ and more recent VoIP software such as Skype.

 

Most communication tools are used among acquaintances. For example, most people use telephone to contact their family and friends far more frequently than they do to strangers. However, one thing appears along with the use of new internet communication tools: "the desire to communicate with strangers." That is a community service, a side effect of communication tools.

 

Chat rooms, forums, BBS, and even QQ are such kind of community service. A group of people are busy talking with one another with stranger IDs, not caring that at the other end of the line is someone they have never seen. In this world, there are always some people that want to know strangers via communication tools. It is already prove to be true for the early telephone-based friend making services.

 

 

We should not forget that although most people are able to use communication tools, only a small portion is willing to take part in interactive communication with strangers, regardless the tools. Within the group, even less are willing to pay. They are the base for profits.

 

[+] The community service is just a show business.

 

Now the profit model of the community service is very clear: to make money from heavy users who are willing to pay for additional opportunities and room to show themselves, to know more people, or to enjoy the interaction. It is a group of people that would pay for the applause of others.

 

The so-called Web 2.0 web sites are often labeled with the sign "share": share diaries, share photo albums, share bookmarks, and even share social networks. Maybe sharing really brings pleasure. However, the sharing activities of those heavy users will not last long without applause.

 

If a blog writer only has two to three readers for each of his/her articles, it will not be long before he/she gives up. If the photos in an album have raised only a few eye browse, someone would start to post pictures of pretty girls or sexy women to get the attention of readers.

 

This is the ultimate concept of the community service: show. There are people who are willing to pay for virtual Avatar items, or for larger storage photo albums. Anything that is directly linked with "possibility of getting more applause" could generate revenue. For players in this industry, what they need to do is to create applause. The community service is just a show business.

 

[+] Back to the basic: making money by content and communication.

 

Nevertheless, those who have the impulse to show are always minority. For the remaining majority, they are here to watch. It proves to be difficult to get those people to pay, however large their number is. Once you start to charge, less people would stay and watch the show. Without enough audiences, the actors would go away.

 

The only role of the large amount of audience is to increase the pageviews to generate advertisement revenue. There will be companies to pay for advertisements so long as the audience maintains its large base. In fact, the advertising model is the most fundamental profit model of online contents.

 

The following figure shows that, as the community service partly belongs to the content service and partly to the communication service, it is only natural to inherit the profit models of both services. In addition to the advertising model, there are also incomes from communication fees.

 

 

Many people are asking if there is a Web 2.0-exclusive profit model. I have never believed there is such a model. Even if there is one, it would have no significant difference from that of Web 1.0. Some sources are quite obvious for revenues from the communication service, such as content subscription thru SMS or WAP, web based friend making service charges via paid telephone, etc.

 

[+] A war for getting excellent performers

 

Currently, most of the so-called Web 2.0 web sites are still in a desperate drive for visitors. Thanks to their attribute of high interaction, community web sites have been able to secure higher pageviews than content sites (e.g., online news). However, except a higher bandwidth cost, it does not mean anything.

 

If someone just leaves a word such as "digg this", or a sentence like "blamed by boss, sad" on the blog, will the web site operator wish him/her better not to write anything, as it only increases the bandwidth and storage cost?

 

To attract high-quality audience, you need excellent performers. None of the so-called Web 2.0 web sites has realized that this is a war for getting those high-quality performers. Some web sites have tried to attract eyeballs with the help of those movie or pop song stars for short time. Yet it is not a sustainable approach, because a single pillar is not strong enough to support an entire building.

 

As a matter of fact, some blogs charge the writers for publishing their works. That would stimulate the writers to creat better contents. (With the money paid, they would care more about the quality of their works). It seems that we need to think more carefully about the human nature revealed by free and charged services brought by the community service. ( 2006/04/09 - By Digitalwall.com - Way to China Internet/Telecom )

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- Read More

Prev : Predictions on China Internet Market (5) Search Engines
Next : Predictions on China Internet Market (7) Web 2.0 Economy

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- Today in History

Great Changes in Wireless Internet Industry (4) Apple's Strategy - 2008/04/06

The Mist of 3G in China (2) TD-SCDMA is a Hot Potato - 2007/04/08

The Mist of 3G in China (1) 3G Makes No Profit - 2007/04/01

Predictions on China Internet Market (6) Community Services - 2006/04/09

Media, Community, and Blog (5) The Power of Media - 2005/04/03

3G Time Comes (4) Video Phone - the Killer Application - 2003/04/06

Thinking on marketing strategies of industry players, start-ups and foreign competitors.

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[+] The strategy for winning out in a saturated market

 

The Internet market in China is still fascinating today because it has not been possible to predict who will win and who will loose in the end. Currently, the first echelon has the control of subscribers and capital. However, the advent of the next 60 million subscribers will be the key to the final result.

 

In terms of marketing initiatives in a saturated market, companies usually have to face a dilemma: is it better to retain client contributing high value (i.e. digging deeper and increasing the revenue), or to continue to attract subscribers contributing lower value (i.e. expanding wider and increasing the subscriber number).

 

There's always the problem of limited resource. For example, if a dotcom possesses 10 dollars, it has to decide which end to lean to: the retention of existing subscribers or the acquisition of the new one? The decision will eventually shape the mode of its new services (or products).

 

Obviously, the existing players in the market have more or less benefited from the first round of Internet enclosure movement. Some have got high website traffic or large subscriber numbers, some high revenues, others, who might be lagging behind in both fields, but high profits. Each company has a different strategic mindset.

 

[+] Eventually, subscriber number is king.

 

The question is: what's next? In my opinion, eventually the subscriber number is king. This is the nature of the Internet. Without a sufficiently large subscriber base, there could be no maximum value to talk about. When an Internet company increases its subscriber number from 10 million to 20 million, it more than doubles its power.

 

Externally, the subscriber number will decide whether you enjoy a strong position or a weak one in time of forming strategic alliances. Those with a large subscriber number could even sit at home and receive proposals from others. Internally, as the Internet is an industry that connects people, a large subscriber number means more opportunities of contacting one another, which, in turn, brings additional revenues.

 

From the perspective of products and services, those with the largest subscriber numbers could always have a larger time window in introducing new value added services or products. They could easily surpass rivals so long as their services or products are equal to those of their rivals. In other words, a large subscriber base is the key to competition.

 

At the beginning of a saturation stage, I suggest that large Internet companies continue to focus their resources on attracting new subscribers. They are going to feel gradually that the growth of new subscriber number is slowing down and they will have to take care of old subscribers. However, the enclosure movement should not stop, otherwise they would regret for it in a few years.

 

[+] The formation of market segments

 

Another identity of a saturated market is the formation of market segments, which mean groups of special subscribers, but not subscriber minorities. In other words, a segment does not necessarily mean a small subscriber base. For example, the female market is a segment, but the subscriber number is not small at all.

 

Due to the restriction of resources, when a large Internet company tries to address the demands of most people, it is hardly able to cover subscribers with special demands, as it is always difficult to both dig deeper and expand wider. In such cases, new market room appears.

 

By focusing on subscribers with special demands, smaller or industrial portals may have the chance to survive. Sometimes segments turn into small subscriber bases, but with the massive size of the Internet market in China, most segments could have sufficient subscribers, which will be able to support the operation of Internet companies.

 

The situation will become more prominent with the surge of the eCommerce market, such as websites that provide shopping services exclusively to women, or offer luxury goods, or even interior decoration services. Players will be able to survive so long as they provide comprehensive and professional services for their respective segments.

 

[+] The last chance for overseas players

 

Thanks to its eye-opening size, China's Internet market, which has been in a high-speed growth stage in the past years, has attracted many international Internet giants. Through direct investment or M&A, those overseas players have been flooding into China. 2005 was a particularly busy year, which saw the entrance of Yahoo!, Microsoft, Google and Amazon.

 

By choosing to enter at the starting point of the saturation stage, those Internet giants at least smell what the last chance is for them. Those that are going to enter the market after 2006 will have to face extremely tough battles with players already in China.

 

In face of acquisition offers by overseas companies, some local players choose to accept and some to refuse (some even claim that they have purchased a foreign giant while in fact they are actually purchased by that giant). All those, to me, are reasonable. As the focal point for portals will be eCommerce in the next few years, Yahoo! China has made a right decision to merge with local player: alibaba.com.

 

As the most important element for eCommerce is the website traffic, it is a right for alibaba.com to choice to partner with a portal. Most importantly, one must have the support of resources to seize a share in the remaining 60 million Internet subscribers in China market. In this sense, a strong brand and a powerful financial stand will be the backing forces.

 

[+] The key is to respect local people and market

 

It was right, too, for the largest online shopping site in China, dangdang.com, to refuse the investment of Amazon. As I said years ago, eCommerce is Local Business. The fact is it proves hard for external rivals to shake the position of local Chinese eCommerce players.

 

As a shopping web site goes from the start-up stage to the saturation stage of Internet market in China, it has stronger footholds. Therefore, it would be unnecessary to introduce external capitals. On the other hand, there was nothing wrong for Eachnet to sell itself to eBay many years ago when it was still at the high-speed growth market stage . The problem is, with the money it got from the foreign capital, how much market is has enclosed? If it's too little, that would be a pity.

 

In general, foreign Internet companies need to respect local people and market. This has been proved by the Yahoo!'s success and eBay's failure in Japan and Taiwan. From the very beginning, both the general managers and management teams of eBay in those two regions were from the United States.

 

For me, it hardly makes sense that, instead of China, some U.S. companies choose Korea as the place to set up their Asian head offices. Some U.S. companies try to integrate local subscriber database in China into the global one after the merger with local Internet companies in order to centralized control in head quarter. The problem is, as there are more than sufficient local subscribers here in China to support the business, why bother to do the database integration? The only thing left is to bring troubles for their subscribers.

 

[+] Marketing strategies in the saturation stage

 

For companies that already have their subscriber bases, the most important strategy should be "acquiring new subscribers through existing ones", i.e., the frequently used Member-Get-Member marketing method, where old subscribers are rewarded for introducing in their friends. Such methods, when used properly, could multiply the subscriber number.

 

To Internet companies, that proves to be a faster and more comprehensive approach, as the network enables much faster dissemination than the offline channels do. In addition to marketing activities, it should be an element to be incorporated into the functionality design of web sites to enable Member-Get-Member effects.

 

The segment most suitable for this Member-Get-Member model is the community service, including instant messenger services (e.g. QQ), Blog, and Web 2.0 services (e.g. SNS). Other than Member-Get-Member, no other reasons could be persuasive enough for companies to introduce Web 2.0 services.

 

Each online service has its profound meaning to internet operators, who, among all things, shall refuse the enticement of fads. For any judgment, companies shall retake the standpoint of "which market stage I am standing at right now? Is the introduction of this service helpful to the acquiring/retaining of subscribers at this stage? " ( 2006/03/05 - By Digitalwall.com - Way to China Internet/Telecom )

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- Today in History

Great Changes in Wireless Internet Industry (2) Yahoo!'s Strategy - 2008/03/09

Great Changes in Wireless Internet Industry (1) Google's Strategy - 2008/03/02

Predictions on China Internet Market (2) Subscriber Number Is King - 2006/03/05

Media, Community, and Blog (1) The Beginning of the Story - 2005/03/06

Stop Internet Marketing (1) All Market; No Marketing - 2004/03/07

3G Time Comes (1) What Is 3G? - 2003/03/09