Web 2.0 Asia

I've been recently approached by a gentleman named Chi Howe,representing Pageflakes in Asia. (Read their interview with Emily Chang here.)

Pageflakes offers one of the best UIs for walking the first-time users through the site. When the site is launched, it's asking if the uers has visited the site for the first time, and then displays bubble help in key places. Helpful, but not overdone - that's good.


Pageflakes imports widgets on the list very well. However, when I tried to import some game widgets from Labpixies, a widget service touted by Steve Rubel of Micro Persuasion, into Pageflakes, it didn't work. I don't know from whose side the problem came. Besides the problem could have been only temporary.


Here in Korea we have some similar services, such as Wizard.com (screenshot below).



But here comes my 2 cents. I know blogs and start pages are totally different, but what if blogs (and possibly other services) start including the core functionalities and user values of start pages? That leads to the question, is letting the users import widgets and have their own startpage a feature, or a commercially viable service?

In the last couple of days, there has been lots of buzz around the upcoming Naver Blog 2. (Naver is the #1 portal in Korea.) As the screenshots below show, the key differentiator will be to let the users choose the components (widgets) to be included in the blog's skin, and let them move those elements around. It can then be argued that the basic philosophy and mechanism behind this "widgetization of the blog" is similar to that of web start pages.



And Naver is not the only blog service that is going in this direction - in fact, widgetization of the blog seems to be the name of the game for other blog services too.

So, back to the question: Is web start page feature or service? I've been told that IT developments fall into one of these three categories: feature, project, and product. They say you can only have a thriving company when you have a product (i.e. one with a viable business model), but too many folks set up a company with just a feature or a project. For example, folks believed (or tried to believe) that online RSS reader was a viable business, but it turned out that RSS reader was more of a feature (e.g. within the browser or Outlook) than a product or company.

Well, but we've also seen some cases where a feature or a project evolved into a multi-million dollar company. Markets don't always make sense, anyway. Both Pageflakes and Wizard.com have successfully established companies and they seem to be in good shape. Hope they will find a killer buisess model and continue thriving as "companies", not merely features or projects.

As if blog was not 2.0 enough, Korean internet giants all seem to be into "blog 2.0".

Naver, the undisputable #1 portal in Korea, has announced its plan to launch "Naver Blog: Season 2" by the end of the year. What's different enough to make it "Blog 2.0"? According to Naver, the game changer will be "the ultimate freedom to edit the blog's skin." (Here in Korea, blog themes or templates are usually called "skins".) Naver Blog: Season 2 will allow user to design custom blog skins by simple drag and drop. I'm presuming some kind of Powerpoint-like interface for editing the blog skin at user's will.

Looks like Naver is taking shots at both #2 and #3 players - Daum and SK Communications (mother company of Cyworld) are both about to launch new blog services themselves.

Daum will launch Tistory.com ("Tee-story"), a co-branded service with Tattertools. Tattertools is the #1 blog server software in Korea (Disclaimer: I am the CEO of the company that builds Tattertools.) Tistory is essentially a Tattertools blog hosted by Daum. It's like Wordpress blog co-branded and hosted by Yahoo: Very powerful, but doesn't have to be installed on the user's own server. One of the key strengths of Tattertools blog is the skin configuration and editing system.

SK Communications will soon launch C2, short for - obviously - Cyworld ver. 2. As well known, Cyworld is a scarily successful service here in Korea. It is reported that one of the key new features of C2 will be, guess what? Customizing the user's home page using widgets as the building blocks.

At this early point, it's not clear who will win out in this "blog 2.0" battle. But at least one thing seems to be certain: all three of the new blog initiatives pursued by Korean internet portals emphasize on the easy customization of the blog, both in terms of features and design. New blog features can be added via widgets, new blog looks can be created or edited on a dead-easy interface (possibly like the Powerpoint), and so on.

And you know what? For the past several years, what happend in the Korean internet sphere soon happened in other parts of the world too. So you might want to pick up some small yet important signals, closely watching how this "blog 2.0" epic among Korean portals gets played out.

DC Inside (note: contents in Korean) is an incredibly popular site that's little known outside of Korea. But looking at how things are transpiring at this company is very interesting, almost entertaining.

DC Inside claims to have 0.8 M daily unique visitors. That translates into around 24 million monthly unique visitors - in October. Can't compare stats from different sources directly, but it's clear DC Inside is getting huge traffic. According to their CEO, DC Inside is perhaps the only major internet company that actively discourages members from writing too often, due to potential system slowdown. (Is the slowdown only coming from traffic surge, or also from poor scalability? We don't know.)

So what's so special about this site? The website is the "one-stop shop" for everything about digital photography. It's got user pics ("galleries"), daily photo news, digital camera and other IT gadget review (a la CNET), e-commerce, user groups, etc.

But what have made the DC Inside a national phenomenon were the UGC (user-uploaded pics) and the unique culture surrounding it. The site is (in)famous for its parody pics, as well as artsy professional photos. To give one quick example of the parody, they start off with a picture like this one...

... and make these:

These parody pics, as well as daily photo news and other content with pictures, get crazy number of comments. So DC Inside is essentially a "giant UGC playground."

So, how can a "UGC playground" make money? DC Inside recently succeeded in backdoor lising and received funding of roughly US$ 10M, announcing they will become a portal and compete directly against other portals. So it's like Flickr deciding to become Yahoo, instead of getting acquired by it.

But DC Inside users are notorious for their anti-commercial sentiment. According to one source, many DC Inside users actually discourage other members from clicking on banner ads at the site, fearing the company will make money off their content contribution.

If making a fortune from user content is evil, then the first company that's evil should be Google, since Google can only sell contextual ads when there's enough content indexed - and most of those content comes from users who didn't give explicit permissions for Google to index their data.

Apparently, the "money game" being played by DC Inside is already facing quite a bit of uproar from its users. How can a company almost entirely based on user content make money? Or perhaps more importantly, how can such a company turn users into raving fans, so much so that the users will actually hope the company will make fortune? Food for thought for UGC/opensource companies.

, if Google is so serious about the online video as to buy YouTube at $1.6B, the company had better look at Korea since it can learn tons about online video there.

In Korea, online video is not an experiment—it is a success. It is a daily reality for most Koreans, not just for the young crowd or the techie set. The entire society has lived the broadband lifestyle for a while now, and is more attuned to its potential.

(Note: Google recently decided to set up a regional R&D office in Korea - despite the nuke test of North Korea.)

Meanwhile, one of the hottest news today in the Korean blogosphere was about the fall of "Mr Kim" - the somewhat mysterious man who made living by putting Japanese adult videos up on P2P sites, but today got arrested.

This "Mr Kim" guy is unbelievable; Over the last 2 years, he posted dozens of Japanese adult videos on Korean P2P sites every single day, ending up having uploaded a total of over 20,000 videos. That's a whopping 70% of all Japanese adult videos in Korea.

"Mr Kim" earned commissions from the file sharing sites, which normally charge customers some small money per megabytes downloaded.

Many Korean Netizens who have been enjoying (nearly) free consumption of illegally shared Japanese adult videos are now virtually "mourning" upon the arrest of "Mr Kim".

Korea is full of free or easily affordable online video content - from TV shows to porns. As such, a portion of Google Korea's recent investment might be used for "".

I ran across this article (note: in Korean) a few days ago. To roughly translate the article:

"Naver (#1 portal in Korea) and SBS (#3 broadcasting company in Korea) will work together to enable more effective video search, one that will allow users to find the scene they are interested in."

Knowing that video search today only means searching the texts or tags associated with video clips, an article like this didn't exactly excite me. But I still gave it a spin anyway.

As expected, although SBS's video service does offer "Find the Scene" menu, it's only searching the texts that are apparently entered manually.

This seems an ineffective and costly practice -- either SBS itself or the content provider has to operate its own staff to put texts manually. Hopefully SBS will incorporate some smart ways to use the power of collective intelligence and have the users themselves enter texts on specific scenes within the video clips (a fun reference: )

We've always heard the story that in the future people will be able to find video scenes by searching the embedded tags (aka "deep tags"). Is this a pipe dream, or a soon-to-be-with-us feature?

Executive summary: The UGC (User-Generated Content) service providers, if they aim to be a truly open service, should provide an option to the users so they can take their own data and content out of the service anytime they want. This will give peace of mind to the users, who are increasingly concerned about data lock-in. This open approach will actually increase user loyalty, quite contrary to the common belief of the service providers that a high barrier of exit will deter customer churn.

When I was in college, at one time I suffered from a mild insomnia for about 2 months, mainly from the back injury.

When I went to see a doctor, he gave me some sleeping pills, but he didn't tell me to take them - instead he said, "the idea that you have these sleeping pills in your closet and that you can take those pills anytime you want will give you peace of mind, which will help you fall asleep."

And you know the rest of the story - it went as the doc said. I didn't have to take a single pill and yet could sleep well, I guess from the peace of mind.

+++

Now let's call this a "sleeping pills in the closet effect", short for "peace-of-mind-from-knowing-the-sleeping-pills-are-in-the-closet effect" ;)

I think this "sleeping pills in the closet effect" has to do with Web 2.0. (I can hear you say, "duh"?)

Web 2.0 is all about user generated content (UGC) and collective intelligence. But do the user generated content truly belong to the users?

Using a common sense, when something belongs to me completely, that means I can move it around the way I want to, whenever I want to. In other words, a measurestick for a truly open UGC service is whether or not the service provider allows users to take their content somewhere else whenever they want to.

Is this the way it is around the industry? Heck no. The barrier of entry for any UGC service is very low - signup is like 2 clicks away. But the barrier of exit, on the other hand, is invariably very high. Does Myspace give you all your data in one neat package when you tell them you are done with the service and now want to get out? No.

Let's say you have used Myspace for 2 years. The only way you can take your 2 years worth of content out of Myspace would be to go over the grinding steps of copying and pasting your blog entries and saving all the pictures by right clicking on each of them and choosing "save the picture as..."

Apparently, service providers are thinking that the more content you have on their service, and the more difficult it is to take those content out, then chances are you will probably give up on any thought of moving out and just stick with the service. This "user retention through data lock-in" might be just what the service providers want. Why?

UGC services are making money, in the form of advertisement and others, off the user content - more users, more amount of UGC, more ad revenue. But as pointed out by people like Scott Karp all the time, no portion of that revenue goes back to the users. In this sense, users are being exploited by the UGC service providers.

It's my content, from my memories in my life - and yet I can't take my content out of the service provider easily, because my content is busy making money for the service provider. This is not good.

Why can't I see a service provider that lets me take my content in a neat package whenever I want to? All the blog entries in a nice MS word or HTML format, all images in JPEGs, and so on - all my content packaged into one single zip file, ready to be transported.

Then I would be able to back up this single zip file, the priceless record of my life accumulated over the last n years, in multiple locations -- on my PC, on my hosted account in the data center, etc.

You want to back up your life record in multiple places, because you never know what will happen. Earthquakes. Service providers going down. You name them.

Recently Netian.com, one of the second-tier internet portal sites of Korea (still with millions of users), shut down without much prior notice, and for days, users were not even sure whether or not they could get their data back. If this kind of thing happens, the last thing I want would be to see my own data sinking down the water along with the service provider.

Service providers are afraid that if the barrier of exit is low, everyone will pack their stuff and move out whenever there's a new, better service. But just because I know I can take my content away anytime doesn't necessarily mean I actually take my content away all the time.

In fact, knowing the service provider allows me to take my content away anytime will give me the similar sort of "peace of mind", as suggested by "the sleeping pills in the closet" effect.

And, just as I didn't actually take any of the sleeping pills, I think the chances of users actually taking their content away from a service provider are very slim -- given that the service provider always strives to be ahead of competition in terms of service quality and innovations.

If the service provider is a sucky one, people will go away no matter how difficult it is to move their data. High barrier of exit doesn't automatically translate into customer retention -- we see this all the time in the mobile service industry.

Mena Trott of Six Apart said blogs will evolve into a platform on whichpeople will archive and present 20 years worth of content. Let's face it: If I'm talking about 20 years worth of my content, I'll definitely want to make sure a) it doesn't go anywhere and b) I have a full control over it. Ensuring these would be a must-have, not a good-to-have feature to be provided by the UGC service providers.

I hope more UGC and Web 2.0 service providers will think along these lines.

Read/write Web (aka R/WW) by Richard MacManus tracks Korean Web 2.0 industry - with this humble blog quoted on a number of occasions. Thanks for the coverage, Richard.

Looking at recent entries by Ajit and Scoble and Dion Hinchcliffe, it looks like there is now a renewed interest in how to monetize the Web 2.0.

As we all know, all great business models are born by understanding and fulfilling fundamental human needs. And I guess Web 2.0 is no exception here. The defining characteristics of Web 2.0 can be roughly matched with Stephen Covey's four fundamental human needs:

• To live and love: Social networking
• To learn: Collective intelligence
• To leave legacies: User generated content (UGC)

On top of the above, I guess there is one other important basic human desire which the Web 2.0 can capitalize on: the desire to get recognized and respected by other human beings. Or to put it more bluntly, the desire to show off.

Why do people buy a BMW? Because BMWs drive terrific, of course, but that's just part of the reason. The idea of a shining BMW parked on their driveway impressing the neighbors is often what gets them finally write the check.

Why do people produce and share content about themselves? Maybe not all the time, but quite often they do so because they want to show off. For example many people blog because they (consciously or sub-consciously) want the peer community to acknowledge their intellectual capabilities. Also, I observe that most popular Cyworld blog topics in Korea include hip restaurants, new clothes or gadgets, travel experience etc. -- things that can generally show the author's lifestyle and (in some cases) affluence.

If we presume that quite often people blog because they want to show off, then why don't we build a good web 2.0 service around that desire? Give people a way to express themselves in a super cool way, so they can talk about their souped-up cars, newly purchased Armani suits, a book they recently read, or even some intangible stuff like their unique experiences or skills (e.g. Japanese-English translation skills, the ins and outs of travelling in Prague, etc). We can call it "the show-off platform".

On top of this, we add social commerce module, so that other viewers can buy stuff (goods or content) from or through the author. So here I want to coin a new term: The Show-off Economy. I believe any Web 2.0 company that successfully implements this "show-off economy" will reap huge benefits.

A while ago, I took the younger sister of my girlfriend out for a lunch. Just to give you an idea, she's a 22 year old music major college student, who uses the internet but is just as far from the geekery as mars is far from venus.

When I asked her if she blogged, she asked what blogging was. But then when I said "you know, we'll increasingly find information about goods and services through other people's blogs and will likely buy stuff from or through them", she said that's what her friends were already doing, and pointed me to this site:  http://www.r-uru.com/


The girl running the site is not a geek herself, she just displays her own picture in pretty clothes and--you know what--many girls check out this site and buy the clothes from her.

So my girlfriend's sister didn't know what blogging was, but her friends were already actively participating in social commerce.

The show-off economy built on content production, if done in the right way, will spread like wildfire especially amoung the young generation.

As I said in this post, I will look into opportunities where other great bloggers can share some of their thoughts and insights with the viewers of this blog.

My first guest blogger is Mr Tangos Chan. He is running China's premier Web 2.0 blog, China Web 2.0 Review. Anyone who is interested in Chinese Web 2.0 industry yet can't read Chinese will find this site very resourceful.

I wished to go to China but couldn't, so an email interview was conducted.

1. Could you tell us a little bit about yourself? What are your
current or past activities that made you start Chinese Web 2.0 Review?

In fact, I'm just an ordinary man.  Currently I'm working in an internet company in Guangzhou to deal with some finance-related issues. But I will move to Beijing soon.  Last year, the concept of "web 2.0" sparked the ideas of many internet startups in China, and more and more overseas VCs are eyeing on China's market.  But I realized that there is an information gap between them. Due to language barrier, English-speaking world don't have many effective channels to know what happened in China. I think an English blog would be a good way for me to try to bridge the gap.

2. Can you describe the funding environment for the Chinese web 2.0
industry? (How hot / cold the market is, What's the average size of
funding, Notable success stories, etc)

In fact, I personally don't know much on the funding and investment circle. But I'm sure the market has recovered from the bubble time, and it is hot, many reputable VCs entered or prepared to enter Chinese market. For example, Sequioa Capital, CRV and KPCB. It's hard to tell the average size, since there are many small cases which you may not know.

Oak Pacific's 48 million funding should be the most notable case, other notable cases include Qihoo and Toodou.

3. In your view, what are the 3 most successful Web 2.0 companies (or
initiatives) in China?

Douban should be on the list, you know, in China, when we talked about domestic web 2.0, we often take Douban as an example.
Dianping is also a very successful website, even though when Dianping launched several years ago, no one knew what is "web 2.0"
Sina blog is my third choice. It is a very successful initiatives to attract users and promote the concept of "blog" to the mass.

(Editor: Wow, I didn't know these until I learned them from you ! I'll check them out.)

4. What's your view on the Asian countries, most notably China, Korea,
and Japan, working together on the Web 2.0 ? How do you believe we can
make this seemingly good idea happen?

I don't think it is easy for east Asian countries to work together, since there is big language barrier among three countries. And it seems that there is also quite different web culture in all three countries.

(Well, I begun my Chinese class :-)

5. Who will win this worldcup :) ?

Netherlands is always my favored team, esp. I'm big fans of Van Basten, but I don't think they will be lucky enough to win the game. So I'll bet on Germany. :)

Thanks, Tangos ! If you have any questions for me, I'd be delighted to answer them. Also as I discussed with you, I'll translate this into Korean and post it on my other columns.

Tistory ("Tee-Story" : The site is only in Korean now), a hosted blogging service by Tattertools (profiled here), has gone into a closed beta.

The service is sponsored by Daum (#2 internet giant of Korea)


As you see, the dashboard is available in English, Chinese, and Japanese as well as in Korean.

Unlike other free blog service being offered by portals, this one gives the user a full control over their blogs. Users can edit their blog UI ("skin") freely. Tattertools (the blog tool powering this hosted service) is an open source platform, which means Tistory users can also import plug-ins (extensions) and blog skins created and shared by other users, a common practice in Firefox and other open source community.

Way to go, Tattertools !