MySpace’s Slow Start in China

cenerpOn June 13, Luo Chuan, chief executive of MySpace China, told reporters in
Shanghai that the new Chinese version of News Corp.’s (NWS) popular social-networking site aims to launch an instant
messaging (IM) service "as soon as possible." Local scribes took him at his
word. The Chinese media began reporting that MySpace China was calling its new
IM product "ASAP." MySpace China quickly issued a clarification explaining that
the company had not actually decided on a name yet and cited a communication
failure for the mistake.
The snafu was symptomatic. After months of intense speculation, MySpace
had launched its Chinese-language site on Apr. 27, marking the social-networking
giant’s entrance into the second-largest Internet market. MySpace China may want
China’s 144 million Internet users to think of it as a local company rather than
just another part of Rupert
Murdoch’s global media empire, but the ASAP incident demonstrated how much
work the company’s executives have to do as they try to establish the site in
China’s crowded Web 2.0 world.
Indifferent Track Record
The Chinese site is operated by MySpace China, which secured funds from
MySpace Inc. as well as Boston-based venture capital firm International
Data Group and China Broadband Capital Partners, an investment firm managed
by former China
Netcom CEO Edward Tian. Spearheaded by Wendi Deng, Murdoch’s Chinese-born
wife, the company is run by Luo, the 38-year-old former head of Microsoft’s (MSFT) MSN division in China.
A high-powered lineup. But U.S. Internet companies don’t have the best track
record in China. Despite their deep pockets and success elsewhere, for instance,
both Yahoo! (YHOO) and eBay (EBAY) spent years vainly trying to win over Chinese users. They
ultimately gave up and entrusted their Chinese operations to local partners.
MySpace China declines to disclose the number of registered users. However,
according to a report by iResearch Consulting Group, a Shanghai-based firm
specializing in the Chinese Internet sector, MySpace China forecasts the number
of registered users to grow at an average of 75,000 new members per month.
The biggest problem, according to Cao Junbo, vice-director at iResearch, is
that MySpace China has yet to localize its products and services to suit Chinese
users. "The current site is just a literal translation of MySpace
International," says Cao. "There is lots to be improved in terms of
localization."
Crowded Field of Competitors
As a latecomer to the market, MySpace China faces major challenges attracting
users. Local rivals such as 51.com,
Mop.com, and Woku.com already boast tens of millions of users. Two of those
rivals, Mop.com and Tianya.cn, claimed 48.8% of user visits to all
social-networking sites in April, according to iResearch. And Xiaonei.com,
self-proclaimed as China’s Facebook,
is leading the university networking sites. "The success of MySpace in the U.S.
cannot be simply copied in China," says Liu Jian, chief operations officer of Oak
Pacific Interactive, the Beijing-based holding company that owns both
Xiaonei.com and Mop.com.

"We have not felt any impact from MySpace China."
Bigger names have gotten into the social-networking business, too. Microsoft
recently launched Windows Live Writer, which allows Chinese users of its MSN
service to write a post in their blogs offline and synch it with their Windows
Live Spaces, the software giant’s social-networking tool. Chinese search champ
Baidu.com (BIDU)
has also extended into social networking through a Web 2.0 service called Baidu
Space.
MySpace seems to have a different vision of how to localize. Unlike its
rivals that build busy and content-rich home pages to attract eyeballs,
MySpace’s site appears austere. "Our target audience is 18- to 25-year-old
college students and graduates with less than three years of work experience"
says Julia Zhu, marketing manager of MySpace China. "User participation and
interaction are more important."
Tepid Feedback
The first move of MySpace China, the instant messaging service launched on
June 13, isn’t likely to wow those users. It’s a preliminary product that does
not support audio and video chat and cannot even transmit files. The Chinese IM
market is dominated by Tencent
Holdings’ QQ, which has 84% IM market share and has expanded services into
game, auction, and mobile IM. Though MySpace China claims that its IM aims to
serve its existing members and will not compete directly with QQ, as the
industry converges they are essentially competing for the same users.
Feedback by MySpace China users so far has not been encouraging. "The site
did not provide me with any pleasant surprises," posted new member "He" on
MySpace. Another user, "odbc," posted "the BBS (bulletin board system) is
troublesome to use," and "Chang" said the site "does not feel so cool probably
because of different cultural habits." Others complain the site is "cold" or
"soulless."
Despite the challenges, MySpace, with its team expanded to around 36 people,
seems upbeat. After all, it has the deep pockets of News Corp. behind it. "We
are not thinking about revenue yet," says Zhu of MySpace China. "We want to
focus on improving our products and services in the next half to one year."

分类标签：MySpace  China  
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