Net

Chinas Joost Gets Funded

Kaiser reports that the "Chinese Joost" UUSee, just received $23.5 in VC funding from DFJ's Growth Fund, Highland Capital Partners and Steamboat Ventures. P2P is really flourishing in China with such players as Google invested Xunlei - a Maxthon partner, PPLive and PPStream. I agree with Kaiser's prediction that it is only a matter of 3G time until we will see mobile P2P services popping up all over China

Update: Talking about the future of video & P2P, there is an interersting article on Technology Review by Hui Zhang called "Peering into Video's Future".

Technorati Tags: China, Joost, Maxthon, p2p, PPLive, PPStream, UUSee, VC, Venture Capital, Xunlei

A Visit to HiPiHi - Chinas Second Life

After a very good board meeting with Maxthon, I paid a visit to HiPiHi - Chinas answer to Second Life. This came about after I had written a short post on them earlier and got an invitation to swing by their office. Kaiser Kuo (Ogilvy) and Xinhua Liu (early investor in HipiHi & Technology Director at Burson-Marsteller).. also joined me.

Armed with camcorders, cameras and curious minds, we invaded HiPiHi physically and virtually. I must say that I was really impressed. I always felt like Second Life was too geeky and to inaccessible, and therefore had only signed in a couple of times and flied around out of boredom.

Not so at HiPiHi. They have been smart enough to realize that most of us deadly are not geeks and need a more user-friendly user-interface to motivate us enough to play around in this virtual world. Although they are just in private alpha, they have come along way with a team of just 60. The user is offered a bunch of pre-fabricated avatars, buildings, hills, rocks, objects and event water to furnish their own worlds. Should they feel for it later, the user can always customize or create any object from scratch as they see fit.

It is clear that HiPiHi has given much thought into making the virtual world more user-friendly. HiPiHi's CEO Hui Xu (beside me on the picture above) explained to us that the service will be launched in four stages based on traditional Chinese creational mythology (read Kaisers summary for an expansion on this).

Revenues will come from virtual property sales and advertising. And I can definitely see how advertisers will love this. Especially since HiPiHi is targeting the young and cool rather than a bunch of geeks in pajamas or "social media stars".

I shot a couple of short clips of a walk-through in HipiHi-land with a simple digital camera. Comments are both in Chinese & English. More clips here.

I have a very good feeling about HiPiHi and am waiting eagerly for the public launch.

(Image above: Sunset in HiPiHi-land).

Piper Jaffray Conference Day 2

Today I spend the day with knowledge hungry investment bankers, then participated in "Emerging Internet Companies" on behalf on Maxthon before running off to Maxthon's Headquarters for a sneak peak of a very new cool service and some upcoming product features. Looks great!

I also ran into a cool newly launched streetwear fashion clothes company just kicking-off here in China. Nice to meet with non-Internet related business people for a change ;). The name of the company is Eno , and the conversation with them certainly triggered some interesting ideas I want to explore...

Tomorrow, I have a breakfast meeting with a leading advertising agency am then off for a board meeting. Time is certainly running fast here and it's great to see so much activity in the Internet space. Before I head home I am going to pay a visit to HipiHi - the Chinese answer to Second Life. I got an invitation from them after I wrote a short post on them. Will certainly be a lot of fun. Bill Tail & Kaiser Kuo has promised to come along as well. Hopefully I will have time to shoot a short video from the visit - we'll see.

Finally, if you are looking for some new interesting investment oppertunity in China that are not related to the Internet. Digg deeper into alternative energy...it's getting very hot..

Technorati Tags: Altertnative engergy, Beijing, China, Eno, Fashion, Hipihi, China Investments, Second Life

A Conversation With Chinese Users

The Focus group panel, a permanent panel at any Piper Jaffray conference was especially interesting since this time the discussion was with young Chinese users as opposed to US teens.

Key Points:

• Favorite activities seems to be to download movies and mp3's
• Baidu is the favorite search engine mainly because of mp3's
• Google is considered "better" in terms of quality
• Prefer to download movies that are either Asian or European (French!) not Hollywood movies..
• Cannot consider to pay for any content. Especially not for music or movies
• But, are very willing to pay for ringtones, virtual items, avatars etc - One girl even paid to get a doctor to heal her sick QQ pet...
• All users bought online
• All used Alipay to pay for goods online - some cash on delivery

What I found most interesting was they all freely and openly spoke about that as soon as they wanted content forbidden by the government - they went Online to get it. Nobody seemed to be the least concerned with saying that openly. This is what I have been saying over and over: young people in China are not concerned or worried about saying what they want - no one is being arrested for a statement like the above... Censorship is something being practised by all governments, organizations, corporations and even Editors of the "free press" all over the world. It just comes in different colors and shapes..

Technorati Tags: Avatars, Baidu, China, Consumers, Download, Google, Movies, Mp3, Chinese Users, Users

China: The Portal Challengers (Video)

The first day of Piper Jaffrays's Annual Growth Conference is just over here in cold but sunny Beijing. The panel called "The portal Challengers" dealing with mainly video sites as a new and alternative destination sites as opposed to the big portals, was really interesting. CEOs of Tudou, Yoqoo.com and Mop (Oak Pacific Interactive) shared their view of the challenges and experiences of Chinas 150+ YouTube's.

Here are the main points:

• Running a video site is a very expensive business
• Nobody is really thinking of making any real revenues in the near future
• Local regulations makes running a similar business in the US look like a dream
• Main thing is to focus on users, build traffic and distinguish your self from all the other 150 sites..
• Download speed key factor
• Chinese users are opposed to YouTube uses are not really sharing videos with each other
• It is still very early days for video sharing sites in China - far away from being a major activity on the net
• Content is mainly of Asian character - not driven by user generated videos like in the US
• Most popular content is of "copyright challenging character"

In short still a long way to go before any of them are making any serious revenues from video content.

Technorati Tags: Piper Jaffray, YouTube, puppy, Tudou, Video, Yoqoo, YouTube

Off to China & Piper Jaffray Conference

I'm off to China on Sunday for the Fourth Annual Piper Jaffray China Growth Conference, March 6-8 in Beijng. I will be a panelist on "Emerging Internet Companies" talking about Maxthon. Piper Jaffray is known for organizing top events (invitation only) and judging from past events - this one looks very promising indeed with a great line up.

It will be a great opportunity for networking and potential Maxthon deals. Top executives from Chinas major Internet , Wireless, Game and Technology companies will be there. I am in particular interested in the Chinese focus group conversation, since I many times wonder what makes Chinese Internet users tick'.

Following the conference I am meeting with Maxthon Fan & supporter No 1: Kaiser Kuo, rockstar & Group Director at Ogilvy Interactive in China, followed by a Maxthon boardmeeting. It will be great to meet Bill Tai (CRV), David Zhang, Yuzhu (WI Harper), Jeff and Carol (Maxthon) again - just hope it will not be as cold as the last time..

If you want to meet up in Beijing please let me know, schedule is quite tight - but long is the night..;)

Who knows, maybe I even will have time to shoot some cool Beijing street scenes?

Technorati Tags: Beijing, China, Maxthon, Ogilvy

HipiHi - The Chinese Second Life

My good friend Kaiser Kuo, made me aware of a Chinese Second Life wanna be called HiPiHi. It is still in private beta, but there is a demo video on the site that you can download. What I find interesting here is that as Kaiser points out, there is a female element here which seems to indicate that the site is going after female gamers: female narrator and avatar, emphasis on the outfits, the landscaping and the houses.

I agree with Kaiser that it would be interesting to see if they will give HiPiHi a more Chinese touch. I personally would find it much more compelling wandering around in a Chinese environment with a Chinese architecture, marble lions guarding my house entrance etc. And here is my personal advice: Why not offering foreigners like me wandering around in HiPiHi to learn Chinese? I could not think of any better way to learn and practice a new language in a virtual world. Just imagine, taking a taxi from the airport, telling the driver where you want to go., going shopping at the market, or join a Chi Gong class? The reverse could also be a great way for Chinese locals to learn English. I would definately be the first to sign up for such an opportunity.

Finally, Kaiser asks if we are going to see advertisers lining up, companies building themselves a presence there just like in SL? I definatley think that can become very big. Just considering the Olympics 2--8 around the corner. Creating a virtual olympic inside HiPHi could be great fun, enabling you to run with the stars. Then, arrange competitions live that could be broadcasted live as well with prices... The site should obviously implement a full mobile payment mechanism so you can by avatars, apparel and real-estate on the fly. Oh, and HiPiHi should definately provide a mobile version as well.

China is such a huge country with so many opportunities, so why should a virtual China world be a success?

Technorati Tags: Avatars, China, Second Life, Virtual Worlds

Navigation based blogging, Second life & mobile

What does navigation-based blogging, Secondlife-like gaming and mobile phones in common? Well, this is the platform run by Japan based mobile marketing firm Naviblog now looking to enter the Chinese mobile space.

China Business Cast has an interesting interview with Naviblog CEO Mandali Khalesi on saying that mobile marketing will drive the adoption of the mobile Web in China.

New Research:The User Revolution

Piper Jaffray just published a fat report called "The User Revolution: The New Advertising Ecosystem and The Rise of the Internet as a Mass Medium". Here are some of its key findings:

• We expect global online advertising revenue to reach $81.1 billion by 2011, representing a 21% CAGR (2006-2011).

• The User Revolution. The advertising world is going through a revolution, one that we call the "User Revolution" as it is happening primarily with the consumers, who are taking control of content consumption and branding. We believe this trend will cause a significant rise in prominence of the Internet as a major content consumption and marketing medium.

• "Communitainment." The Internet has increasingly become a principal medium for community, communication, and entertainment--three areas that have collided together and are impacting each other's growth--generating a new type of activity that we call communitainment.

• The Internet Is Mainstream. The Internet has become a mainstream media outlet that now rivals traditional media for reach and advertising dollars.

• Media Fragmentation. The proliferation of online and offline media outlets has resulted in shrinking television audiences and an increasingly fragmented media landscape.

• The Golden Search. We believe search continues to gain ground, driven by the rise of search as the New Portal, the increasing use of search in branding campaigns, and the local search opportunity.

• We believe Google's wide variety of non-search-related products creates a virtuous cycle of brand affinity that drives incremental search volume.

• Video Ads Could Drive The Next Wave. We believe Internet video ads could become a game changer for large brand advertisers, who are used to the 15- or 30-second TV commercial

• Internet Usage Patterns Are Changing. Portals maintain the highest reach, but the fastest growing category of destinations is communitainment sites such as MySpace and Facebook.

• Ad networks are experiencing increased demand due to increasing Internet fragmentation, desire for more targeted inventory, increasing usage of networks for branding, and increased site visibility.

• Agencies are rapidly evolving into more sophisticated, technology-savvy entities that combine best of breed offerings.

• Companies to watch: Google (and YouTube), Yahoo!, Disney, News Corp, Time Warner, Microsoft, InterActive, Facebook, Craigslist, Brightcove, Yelp, SINA Corp., Baidu, aQuantive, ValueClick, 24/7 Media, Netflix, Wikipedia, MobiTV, Digg, and Hakia to be the most important players to watch.

Like my good friend Kaiser Kuo, Group Director for Digital Strategy, for Ogilvy China, mentions in this new (and great) blog " Ich bin ein Beijinger" : none of this should come as a surprise, but the report is full of eye-opening finding regarding the decline of TV viewing, changing viewing and decline of broadcast TV ad as percentage of total ad spend.

Kaiser who has a unique insight to China (and was very much responsible for Maxthon getting discovered and funded..) is confident that advertisers will flock to video ads and all the opportunities that are opening up for digital media advertising in China .However, he wonders how ready people really are for pre-roll commercials stuffed in to things they want to watch.

I tend to agree with Kaiser, although there is a fantastic opportunity for advertisers, the Internet savvy users might very well prefer to block ads if possible. This is something we have learned at Maxthon and seems to be especially true for Chinese Internet users. Al the sophisticated ad-blockers and filters that come pre-installed in Maxthon has definitely been one of the key driving factors for Maxthon success in China.

Anyway, next week I am flying down to Beijing again to talk on Piper Jaffrays Annual China Growth Conference on behalf of Maxthon. I will then have a chance not only to meet up with Safa and rest of the Piper Jaffray gang, but also to meet with Kaiser again and plot how we can deliver some interesting advertising opportunities together in China.

 

Thanks to Mark Pols for sending me this fat report!

Bonus: Video Interview with Kaiser I made just before he left the Red Herring.

Sign-up: Annual China Venture Conference 2007

A good friend of mine is helping to organize the Annual China Venture Conference 2007 set for April 12 in Beijing. Looks like it’s going to be a great event that will hopefully offer a fresh perspective to the Chinese VC business. My buddies at WI Harper Group is of course going to be there too.

The goal of the event is to provide a forum for investors to plan their future investment strategies in China.Investors from all over the world will meet and share the experiences and wisdom about investing in China and brainstorm about future investment opportunities in the Chinese market. 

The theme of this conference is "Capturing the New“. New trends, new opportunities and new challenges will be discussed at the conference.  New investment strategies will be highlighted.

Get the full program info here. (pdf)

If you are interested in an invitation - please contact me.