MENLO PARK, Calif.--If you want to make money as a venture capitalist, the consumer Web offers the highest, most consistent returns, according to Steve Jurvetson.
The low costs required to start these companies is a big part of the appeal, Jurvetson, a partner in Draper Fisher Jurvetson, said in an interview at the Nordic Green conference here this week. By contrast, biodiesel start-ups need millions to get through the experimental stage and then tens of millions to go into pre-production.
Networking also works well with Web companies. A successful word-of-mouth campaign that costs almost nothing can propel growth rates. Skype in a few years collected more than 309 million members. Again, this is something a solar company can't do. If Facebook had to climb on your roof for three days, erect several panels of solar-sensitive glass, and hand you a bill for $20,000 before you could use their product, it wouldn't be that big.
Historically, some consumer Web companies have also figured out ways to exploit inefficiencies in existing versions of similar products. When Hotmail came out, people generally paid for e-mail software. Now it is just a free service supported by ads. Phone service is transforming from a separate expense to a service included in an overall data package. (DFJ was an investor in Hotmail and Skype.)
So laugh all you want at Web 2.0 business plans. They do seem to work. But often, isn't easy to pick the ultimate winners. Veoh Networks seemed to have all the right elements, but it got eclipsed in video sharing by YouTube. Still, you can even make money on a second-tier company.
Interestingly, there's recently been an emergence of companies trying to merge Web functionality with alternative energy. Sungevity, for instance, has come up with a way to give consumers a solar estimate over the Web. Typically, that takes an appointment with a technician.
On other notes, Jurvetson, who sits on the board of Synthetic Genomics, outlined why biological processing may prove superior to thermochemical processing when it comes to making biofuels (Synthetic Genomics creates designer organisms that can metabolize light or waste products into energy or other things). Basically, it comes down to evolution. A metabolic pathway in a microbe may have evolved over millions of years. "I would bet on an evolutionary algorithm over a man-made one," he said.
Microbes often operate at room temperature, so processing, potentially can be more energy efficient.
William Chang, chief scientist leading Chinese search engine Baidu, said it's natural for Chinese to use Baidupedia (Baidu Baike) rather than the foreign Wikipedia.
"There's, in fact, no reason for China to use Wikipedia, a service based 'out there,'" Chang said at the WWW2008 conference in Beijing on Tuesday. "It's very natural for China to make its own products."
I agree that there's not always a reason for people to use global services, especially when what they deal with is primarily domestic. But with the wiki world, I think the value of cross-border, multilingual conversation is astonishingly high.
Especially as autotranslation gets better, the benefit of not having populations nationally siloed comes into focus. If we can both read and contribute knowledge to something that primarily exists in a language I don't know, then we really can share knowledge.
Until that utopian vision comes true, though, it very well may be that Wikipedia isn't yet built ideally for Chinese users. Perhaps Baidu is doing a better job for people in this country. But I hope we can all get to conversing across this divide.
For now, it's more or less moot. As I reported before, despite the fact that Wikipedia in English is now available from China, the Chinese-language version is still blocked.
Google is giving itself about five years to unseat Baidu.com's dominance for Internet search in China, The Wall Street Journal reported Monday night.
"We would like to aspire to be a market leader in five years," Kai-Fu Lee, president of the Google's Greater China operation, told the Journal. Google also is examining possible investments in social networking and , he said.
Protests break out in some nation around the globe and one of the first things a media-shy government does--just after sending in riot police--is pull the plug on YouTube.
The latest example is China's handling of protests in Tibet. The Chinese government has blocked access to YouTube in that country after scores of clips showing violence between police and protesters were posted to the site, according to hundreds of reports found on Google News.
On a trip to China in 2007, News.com reporter Michael Kanellos visited the offices of KU6.com, a rapidly growing video-sharing site in China. Here, KU6 workers review videos for "inappropriate" content before they can be posted.
(Credit: Michael Kanellos/CNET News.com)Scores of other media outlets have been blocked or partially blacked out in China, including broadcasts of CNN, the BBC World, and Google News. But it's YouTube that gets all the ink.
In an example of YouTube's influence, blocking access to the video-sharing site is now a sort of scarlet letter for governments. The site, which allows individuals to communicate with mass audiences, has become a symbol of free speech to many, and governments that forbid it are immediately branded around the world as repressive.
This kind of image can't be welcomed by China as it prepares to host this summer's Olympic Games in Beijing.
In its report on China's YouTube ban, The New York Times asks whether the Internet and its ability to enable individuals to communicate with large audiences can stand up to a "ruthless government."
The Web publication for British newspaper The Times wrote Monday: "YouTube has been blocked in the past, and the so-called Great Firewall of China prevents discussion of and searches for many sensitive topics, such as the Tiananmen Square protests."
The ban was reported in newspapers in a host of other countries including Russia, Turkey, Canada, and Ireland.
China is obviously no fan of user-generated content. In January, the Chinese government tried to impose a rule whereby only state-run companies could post videos to the Web. The measure was quickly altered after people began raising questions about freedom of speech.
The country's authorities routinely block sites such as Wikipedia, the BBC, and even live TV transmissions to hinder publication of stories on the Dalai Lama, Falun Gong, or even stories critical of leaders or governments that China is trying to build better relationships with. Last May, while reporter Michael Kanellos watched a CNN story on Myannmar from a hotel in Beijing, the screen went blank. CNN only returned when the news station was broadcasting a different story.
The Great Firewall of China isn't perfect, and it will alternate between blocking particular sites and allowing particular sites, but it does make it more difficult for Chinese citizens to get full information or news stories, according to some analysts.
The Firewall also seems to allow Westerners to view objectionable material in China, while blocking it for Chinese readers. Conceivably, this could be a technique to blunt criticism from the West.
On an Internet connection from a room in a Western-owned hotel, censorship was fairly light, Kanellos reported. Hundreds of images of the Tiananmen Massacre of 1989 popped up on Google Images, particularly images of "Tank Man." News stories, or at least headlines, on controversial subjects came up as well. In an Internet cafe, far fewer images of "Tank Man" appeared, but they could still be found. A few videos of the riots also were available on second-tier video sites like Veoh Networks.
But those results came when the search is conducted in English. Searching for Tiananmen Square on Google's Chinese Image site with Chinese characters revealed no pictures of the riots in 14 pages of images. The only one--on 14 pages of results--that relates to the 1989 riots was a picture of the Goddess of Liberty. On Baidu, the more popular Chinese Web search site, not even that came up.
In the latest controversy, the Chinese government may have been spooked by what happened in Myanmar last year. Clips of troops clashing with protesters were widely videotaped and posted to YouTube before the site was blacked out in Myanmar. By then it was too late. World condemnation of the crackdown was only spurred on by the YouTube ban.
Perhaps the poster child for bans gone wrong is Pakistan. The government there was angered over videos it found disrespectful to Islam and demanded YouTube be blocked. An ISP in Pakistan goofed and erroneously shut down access to YouTube around the world. The government lifted the ban soon after.
The other important issue in all this is how Google will respond to China's ban. A representative said that the company is "looking into the matter," and trying to "ensure that the service is restored as soon as possible."
But what happens if China wants Google to begin self censoring videos or wants to know the names of the people who posted the clips of the Tibet violence?
Yahoo can be used as a model of what can go wrong when negotiating with the Chinese government. The portal handed over information about a journalist who was later sentenced to eight years in prison for posting comments critical of the government online. Yahoo's action has been widely condemned ever since.
CNET News.com staff writer Michael Kanellos contributed to this report.
I was all ready to highlight what seemed like a very insightful comment on this blog by a co-founder of the advertising company CultureFish Media on the merits of Baidu, China's leading search engine. But then I remembered Rick at CNET Asia had asked readers for reasons to love Baidu. Lo and behold, the same comment appeared there under the name of a different CultureFish exec (and prominent blogger).
This wouldn't bother me at all, except that the comment includes personal reflection, such as this passage that appears verbatim in both posts: "Maybe I will get more bullish on Google when they get around to assigning someone to answer my phone calls or when their operator tells me that their marketing department does not have a phone number." A quick Google search didn't turn up any more copies of the same comment, but what's the deal guys?
The comment first appeared under Lonnie B. Hodge's name on Rick's Little Red Blog. Hodge is CEO of CultureFish and The Professor at Onemanbandwidth, a long-running China media blog. There, Hodge has criticized an article that painted Baidu inaccurately as an "upstart" engine and may have been inaccurate in its portrayal of Baidu's music search. (Mea culpa: By reporting on articles with similar material, I may have perpetuated inaccurate numbers, if they are indeed inaccurate.)
On Sinobyte the comment appeared under the name of David DeGeest, one of Hodge's coworkers. The comment was different only in that it fixed a few typos and was prefaced with a good rebuke of a xenophobic comment that had appeared above and managed to misspell "develop" while saying "men from the east" aren't that smart.
Whoever wrote the comment, its laundry list of reasons users and especially advertisers might like Baidu is informative. I just wish credit had been given to whoever was the original author. (Also there's a "next week" below that doesn't work on the second posting since it was more than a week after the first.) Here's the list:
- They now devote more than 10% of revenue to R&D.
- They are innovating at a terrific rate: They have instant messaging in the works, the Answer service similar to Naver/Yahoo, a developing financial section similar to Google, some new social media acquisitions coming that will modernize them and likely steal a load of Tencent's traffic.
- They have advertising solutions that can be tailored--as opposed to Google cookie-cutter stuff- for any biz.
- They have a 30% no-count rate for click-throughs on ads (Google is 10%) to fight click fraud.
- They have opened their API to new analytics companies (they will formally announce a partnership with Omniture next week)..
- Their bulletin board system just surpassed the 200,000,000 post mark.
- They dominate mp3 download searches and are leveraging that into BRANDED deals with music companies and artists. IF you took away ALL their mp3 searches that everyone ******* about, you'd only take less than 8% of their market share...
- They are not the Yuppie stuffed shirts running Google. I have access to decision makers at Baidu and don't have to wade through layers of people who think they are too important deal with me....
- They are open to new ideas: our company now has a strategic partnership with PRNewswire and are co-investigating a tool with Baidu that will change the face of online news releases....
After all, I find this to be a pretty persuasive list, though I won't likely switch to Baidu anytime soon, while they're still censoring large portions of search results, even though I realize that's not a top concern of many Chinese users. I had e-mailed CultureFish's public address hoping to get in touch with DeGeest to clarify some information before I discovered the repetition, by the way. I'd still be curious to find out about some sources, especially for the music downloading issue that I've written about.
Baidu.com, the top Chinese search engine, gets lots of its traffic from a service that tracks and links to MP3s, most of which are illegally posted. Now a Chinese music industry group is suing the site over alleged copyright violation.
The AP reports:
Music Copyright Society official Qu Jingming said in a statement posted on the society's Web site Friday that Baidu.com provided "music listening, broadcasting and downloading services in various forms on its Web site without approval, and through unfettered piracy, earning huge advertising revenue on its huge number of hits."
The copyright society said its lawsuit, filed in a Beijing court in January, claims Baidu used 50 songs illegally and demands compensation. The alleged piracy forced legitimate online-music providers to shut down, the industry group said.
This comes at a time when Google, which is hoping to catch up to Baidu in the Chinese market, is working with record companies to provide legal links to music for searchers.
Baidu, China's leading search engine, gets 7 percent of its traffic on a service that eases access to free music downloads. Google, determined to catch up after two years in what is now the second largest Internet user base on earth, may follow suit.
The Wall Street Journal describes Google's possible plans thusly: "Vivendi SA's Universal Music and about 100 other foreign and domestic record labels have been working with Top100.cn, a Beijing-based Web site that currently sells licensed music downloads for 1 yuan (about 14 cents) each, and Google. Together, Top100.cn and Google would provide free MP3 downloads with value added services, people familiar with the plans say. The new search options, for example, promise to give users free access to a database of information about their favorite artists--from concert listings to links to special ring tones."
This stands in contrast to Baidu's service, which the Journal says has led to legal disputes with record labels because illegal downloads are accessible. You get no shortage of illegal download options when you run a Baidu music search for Björk mp3s. (Sidenote: Björk herself plays Shanghai March 3.)
It will definitely be striking if Google puts legal music online. Like DVDs, CDs here are almost always illegal copies and it would take some doing to find the legal ones in many cases. Perhaps they will share ad revenue from the search pages with the record companies. Something like the ad-supported free music we hear on the radio, but available anytime and as a high-quality file...
P.S.: The Journal article includes a useful outline of the Baidu-Google competition in China.
I'd meant to note this earlier, but SEO Hong Kong posted a summary of some findings when Chinese Internet users were tested comparing China's leading search engine, Baidu, with the newer Google.cn.
In a test conducted with Chinese subjects, eye scanning on Google.cn was more focused in the upper left hand corner compared to Baidu despite the fact that both search engines have nearly identical page layouts. Baidu users also scrolled down the page more than the Google users, but clicked on less sponsored listings--less than 1 percent compared to 3 percent for Google. ...
On Baidu, less than 45 percent of all clicks took place in the first 3 organic listings. This was much less focused than Google.cn where over 70 percent of all clicks took place on the top 2 organic results alone. Baidu pages also had significantly longer reading times--an average of 55 seconds--compared to 30 seconds on Google.cn.
The blog says the test was conducted by Enquiro. This result would seem to suggest that Google, like when it's compared to other English search engines such as Yahoo, seems to get users to what they want more quickly. I'd caution, however, that there may be a complication in that the test subjects may have been more familiar with the Baidu layout and were thus more interested in culling more information from familiar locations on the page. Both sites have exceedingly clean front pages.
(Credit:
Google/Sinobyte)
I thought I'd give the two a comparative whirl with a simple search for something a Chinese user wouldn't necessarily need to search for: what is the exact date of the Spring Festival/Chinese New Year in the Gregorian calendar. The result? Google wins, giving me the date, as well as an icon indicating this is the coming year of the rat. It also links to a board for Spring Festival greetings...
(Credit:
Baidu/Sinobyte)
Baidu also links to its festival page, which gives us a history of the holiday, but it's significantly harder to find the most simple fact you might be looking for: the exact date. On the other hand, Baidu's page gives you a nice history (translated) of the holiday.
Google is also rumored to be experimenting with a more, say, cluttered home page for the Chinese market, along the lines of the leading Chinese search engine Sohu.com. I'd love to see comparisons of user experience including Sohu's Yahoo-esque portal. Yahoo itself, so far, is something of an also-ran, with a live beta online. Why it advertises that it's a beta and doesn't just launch with continual improvements the way Google has is beyond me.
Shawn Wang, chief financial officer for Baidu.com, the leading search engine in China, died Thursday in an accident while on vacation during the holidays, the company said in a statement.
(Credit:
Baidu.com)
The company did not elaborate on the details of the accident.
"We are all completely shocked and deeply saddened by this tragic news," said Robin Li, Baidu.com's chairman and chief executive.
Wang joined Baidu in 2004, four years after its founding, to lead it to a successful initial public offering on NASDAQ in August 2005. Earlier this month Baidu.com became the first Chinese company to be included in the Nasdaq 100 index.
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