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Last week in China – Google Net Negative and again MySpace

Last week was about the latest China internet Statistics. The China Internet Network Society (CNNIC) published its half yearly report (In Chinese). The number of Chinese Internet users is increasing. There are now 137 million Internet users in China, 23.4 percent more than last year.

The report also shows that the majority, 72.1 percent of the internet users, is under 31. More than 68 percent of the Internet users has an income of 2000 Renminbi or less. 2000 Renminbi equals 257 US Dollars. Not yet a lot of disposable income to spend online. More details about the report next week.

What else made the headlines in China.

Google in China – A net negative Decision

In Davos at the World Economic Forum, the Guardian got an interesting quote from Google Co-founder, Serge Brin about their decision to censor its search engine in China.

From the Guardian:

Asked whether he regretted the decision, Mr Brin admitted yesterday: “On a business level, that decision to censor… was a net negative.”

The company has only once expressed any regret and never in as strong terms as yesterday. Mr Brin said the company had suffered because of the damage to its reputation in the US and Europe.

Last year in a speech in Washington Mr Brin admitted the company had been forced to compromise its principles to operate in China. At the time, he also hinted at a potential reversal of its stance in the country, saying “perhaps now the principled approach makes more sense”.

From what was said yesterday a policy change seemed unlikely in the near future. Co-founder Larry Page said: “We always consider what to do. But I don’t think we as a company should be making decisions based on too much perception.”

This doesn’t indicate Google China will change course and have a more principled approach. If they would take that route, it would basically mean they would have to pull out of China as there is no way to do business in China without playing by the local rules. At the moment Google is the only real competitor of Baidu, a local Chinese search engine. Baidu is much more censored than Google China. Also most Chinese internet users that search with Google use the international Chinese language version instead of the censored version.

MySpace is really coming this time

There have been rumors abound for a long time now that MySpace will enter the Chinese market. Back in September 2006 it started, in December 2006 there were more and now it seems they are for real.

The domain shows already the message “China Web Leading 2.0 website is under construction”

According to Reuters:

News Corp. is finalising a deal with partners, including private equity heavyweight IDG, to launch a networking Web site venture in China within a few months, financial and Chinese government sources said on Friday.

News Corp. plans to take less than 50 percent of the venture, which will establish a localised Chinese version of the popular site, said sources familiar with the deal.

The IDG-Accel China Growth Fund, managed by venture firm International Data Group Technology Venture Investment, will also own a stake, two sources said.

Internet content and news licences are heavily regulated in China and with a minority stake MySpace China can be regarded as a local company. This will ease the process of getting the appropriate licences. A minority stake will also give less control for MySpace International.

Provided the deal gets finalised, it will still take some months before they launch.

It will be interesting to see whether MySpace China can make a dent in the already crowded Social Networking market.

From Marketwatch:

With gorillas like Tencent Holdings Ltd., Microsoft Corporation’s “MSN Space” and a host of other Internet services vying to dominate China’s new online media community sector, MySpace would do well to remain as “local” as possible … and get into the game as soon as possible.

That pretty much sums up the main events of last week. Most importantly the Internet is really getting back to speed here, which makes life a lot more convenient.

Gemme van Hasselt is an Internet Marketing Consultant, living in Shanghai, and owner of thé China Directory.

Category SEO
Last week in China – Google Net Negative and again MySpace

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