The Web2.0 is not that attractive to everybody, at least that was what I felt about the China web. Here are the highlights when I was there one month ago.
After a busy schedule in Beijing and Shanghai, I went to Chengdu which is regarded as the most important developing city in south-west China. I knew there wont be easy to find a web2.0 company there, but I still felt lucky because I was introduced to a so-called the biggest web2.0 startup there. I was hoping they can be a nice guide to the local market. However, after 1 hour conversation with its CEO and another friend there, I changed my mind. It was a very interesting conversation really, and it is actually a lesson for me. Usually, the RSS will be the starting point where I can discuss the potential partnership with other companies. 10 minutes after the conversation started, I realized that talking about RSS did not make sense there. The conclusion I got from them:
1. There is no web2.0 left in the south-west China web. According to my friends’ words, there are some web2.0 startups back in 2006, but most of them were dead;
2. Web2.0 is dying (I was a bit shocked when I heard that) simply because only few company can gain the revenue in the end. The users can give you the contents, but can they bring you the money?
The second point actually got proved when I was in Hangzhou, a very nice city close to Shanghai. Here I give you two companies which for sure will help you remember this small city, Taobao.com which defeated EBay China to be the No.1 consumer auction site, Alibaba.com from the same founder of Taobao now has been recognized as the No.1 B2B service provider in the global market. Alibaba has been profitable for a long while and also has a very good cash flow (FYI, Alibaba’s total revenue for 2004 was US$68 million). Are they web2.0 companies? Web1.5, maybe? Another site in Hangzhou is China Chemical Network. I thought it was a joke when my friend suggested me to visit them, but this ChinaChemNet is actually the first Internet company listed in the Shenzhen Stock Exchange (SSE). It is not really web2.0, again.
So why is it so hard for the web2.0 earn the money in China. Maybe you can get some hints from this. China probably has the biggest market, but it also faces a very tough competition. Anytime when you try to launch some paid service, think it over and over, because there always some competitors will announce the similar service very soon, and for Free! Remember, it is reported there are over 200 video-sharing sites running in China.
The users love the web2.0, but the Web2.0 have to live on the money. Well, it is not the issue only annoying the Chinese web2.0 startups, it has been discussed globally for a while. Of course I dont know the perfect solution, but I have a suggestion which I think it might work in China: Bring your Web2.0 to the Chinese Mobile market which is even bigger and more mature.