Always asking for WiFi passwords when you’re out and about? WiFi Master Key (our translation) is an application that automatically connects your devices to WiFi networks when in range. The company claims it has collected about 700 million WiFi hotspots across China. The hotspots are not voluntarily shared by WiFi network owners, but WiFi Master Key allows them to opt out. The service is for free.
There are several similar services in China. Many are developed by big internet companies, such as Qihoo 360, Tencent, Wandoujia, Xiaomi, and Xunlei. It is believed such an app will be the first everyone uses when arriving somewhere, so all of these companies plan to add location-based services on top of it.
WiFi Master Key claims it’s the largest such app in China, with 500 million registered accounts and 250 million monthly active users. It has been reported that the company has begun generating revenues from advertising. It’s not profitable as yet, however, as it has to pay Chinese telecom operators or WiFi service providers in order to offer as much choice as possible for free to users. The app is available on Android, Windows and Mac. The iOS version will be launched by year end.
The company’s next step is to get offline merchants and lifestyle services on board. It has signed deals with some Chinese group-buying and rating and review services, and a taxi app, among others. Ideally, a user at a certain place, after connecting to the WiFi network, will be able to find deals listed on different group-buying services, then order a taxi, for example, through the app.
WiFi Master Key is a project of Shanda Innovation Institute (our translation), an incubator established by Shanda. The company is led by Chen Danian, the twin brother of Shanda CEO Chen Tianqiao.
Shanda is known for their creative business ideas in the Chinese internet market.
The company came up with the idea of selling credits for in-game purchases at internet cafes across China instead of at news-stands or other traditional distributors, and developed a software system for them to sell credits online. With a single online game licensed from South Korea in 2001, Shanda became one of the biggest online gaming companies in China.
As early as in 2005 Shanda launched a set-top box full of online games, planning to introduce more digital content so that it would become the digital entertainment hub for Chinese households. Shanda Innovation Institute, launched in 2009, was one of the first tech startup incubators in China and so far the only one by a major Chinese internet company. Cloudary, the online literature publishing platform Shanda established through a series of acquisitions, is the largest of its kind in China, and one of the first to license works generated on the platform to game developers and TV and film producers.
Set-top boxes, startup incubators and online literature publishing all are popular businesses in China. But Shanda had had much less success with them in comparison to its gaming business. Now Xiaomi is on the way to becoming a digital entertainment hub, with hardware products including a set-top box and making a substantial investment in digital content. Shanda Innovation Institute was closed in late 2012: the core members of Cloudary have left Shanda and the company dropped the IPO plan. The recent rumor is that Cloudary would be sold.
So in the past a couple of years, Shanda was labelled as a failing gaming company. Shanda Interactive delisted from the NASDAQ in 2011. Shanda Games, the gaming company spun off from Shanda Interactive, also delisted in early this year.
Will Shanda make WiFi hotspot sharing it’s next big success or will it be just another great idea which doesn’t translate into the market? Time will tell.