Former head of Google China, Kai-fu Lee, insists—insists—that he is not happy that Google imploded its business in China. “Seeing the work that I put in, how could I be happy to see that?” he says. In fact, in a press release all about his incubator’s companies being built on top of Android he doesn’t use the G-word once. “Given the pull out, we’ll accept the situation and do our best,” he says humbly. Yeah, accept the situation like a fox.
As Lee begins to open up more about the types of companies being created at his incubator, Innovation Works, there’s a consistent theme—Android. Whether it’s address books, music programs, video games, maps, eCommerce marketplaces or e-readers, many of Lee’s companies are hoping to take advantage of the good things about Android—namely that it’s a free, robust operating system—but customize the core smartphone applications in a way that Google won’t or can’t.
It’s interesting that I had a conversation with Lee about this topic right about the time Google CEO Eric Schmidt was delivering a keynote touting that more than 200,000 Android-powered smartphones are activated daily, going beyond just the smartphone wielding “elite.” Lee would agree with everything his former boss said. It’s just that Google isn’t well positioned to make money off the apps and services in the world’s largest market. Oops.
Lee philosophically may have issues with the lack of openness in the Chinese Web, but it’s also giving him an advantage: The most popular applications for the Android phone like YouTube, Facebook, Twitter or Pandora aren’t available in China, and Google’s native apps may not be the top choice of manufacturers given the search engine’s stance on doing business in the country. So Innovation Works is collectively trying to build a new Web on top of the platform that’s customized for Chinese tastes.
For example, music services that show song lyrics as they play—an essential feature for China’s karaoke loving audience. Another example is a program that automatically enters different dialing prefixes that save money on calls to certain regions. Because 3G is so expensive in China, a video program called Wonderpod downloads videos onto your phone from your laptop at work, so you can watch them without having to stream them on the commute home. An eReader software company lets you read 60% of the book for free then asks for a payment to read the rest. Because of rampant piracy, there’s no chance of selling eBooks without giving anything away for free, but once people are hooked, if they enjoy it, they’ll pay for the rest of the book out of convenience, Lee argues. The incubator is making a few, broad platform plays with an Android-based operating system called Tapas, an analytics tool for developers called Umeng and Ascending Cloud, a publisher of social games.
At most, Lee’s mobile companies are getting a couple dollars per user for these apps so these ideas only become huge companies with massive scale. This can’t be just a game played for the top of the pyramid. And there’s no question in Lee’s mind that Android will be bigger in China than the iPhone, because the cost differential is much more pronounced. Because there aren’t many Android models in the US, hardware makers can price the phones close to the iPhone, but in manufacturing-heavy China prices will almost certainly be driven down much faster.
Lee says the Android devices coming out next year—including manufacturers his companies are working with—cost $200 to $300 per phone. He expects that to fall to around $100 the next year, and possible fall below $100 the year after that. The iPhone will never experience that kind of competitive pressure because only Apple makes it. (Although I could show you plenty of cheaper versions with the an Apple-like logo in the dodgy markets of Shenzhen…)
And there are no carrier subsidies in China, because 80% of phones are bought independently from airtime. So an iPhone will cost around $600. Already Android will enter the market at half the price. For a big swath of the Chinese population that will make a difference, especially if those prices can get under $100 per phone in just a few years with features more tailored for the market.
In a lot of ways, this is a strategy that would only work in China—it’s all about volume and counts on a market with hyper-aggressively competitive gadget manufacturing. But with billions of dollars in venture capital sloshing around China, the market to build the best mobile apps could be as cutthroat as the competition to win the hardware wars. Lee has recently inked some strategic partnerships with Foxconn, Chunghwa Telecom, MediaTek Inc and a raft of global investors to help his chances of being the one to profit from the opportunity.
He’s also moved Innovation Works from Google China’s building to a new location that features what any incubator needs—a hologram that greets you at the front door. I’m not kidding. He told his designer he needed it to look different than any other office and from the look of the pictures, he succeeded. His mobile bets are less certain. But if he wins he’ll have at least one guy to thank: Sergey Brin. A big juicy market opportunity is a lot better parting gift than a watch.
Social games are the rage these days, but making money from them isn’t easy. Gamers play these titles for free, but Adknowledge is figuring out how game publishers can wind up making money from 100 percent of the players.
Adknowledge’s Burlingame, Calif.-based Super Rewards subsidiary is launching a three-part system for making money from virtual currency in games. That could help boost the engagement of players in social games and help raise the revenue generated from each user, said Adknowledge chief executive Scott Lynn. Adknowledge can offer this money-making system as a one-stop shop for publishers and game advertisers.
The three elements include an in-game overlay, offer banners, and a new offer wall for online game publishers. Adknowledge claims the new platform improves the experience for users and increases the number of paying users in a game. Adknowledge is one of a number of companies that give users the option of accepting special offers in lieu of payment for an online game. You can accept an offer such as signing up for a Netflix subscription in return for virtual currency in a game.
But results show that roughly 75 percent of players do not use offers. Super Rewards can target those missing the offers with an in-game overlay, which brings a single, high-value offer to users within a game. The overlay shows up at strategic moments in a game, such as after the initial load. The offers can include promotional language such as “Get More Coins.”
The offer banner uses the space around the main game landscape, presenting a mini version of an offer wall during game play. Users can pay for virtual items at the moment with direct payment methods.
Publishers using the three-part system include The Broth, whose Facebook game Barn Buddy saw its revenue increase 25 percent after using the new system for just five days, said Broth chief executive Markus Weichselbaum. Other publishers have seen a 45 percent increase in the number of new paying users. Adknowledge said developers have seen a 40-percent increase in the number of first-time payers. Super Rewards’ rivals include TrialPay and Offerpal.
Adknowledge has more than 300 employees and $300 million in revenue, making it the largest privately owned internet advertising network. It was founded in 2004 and has grown through acquisitions. The company has raised $48 million in funding from Technology Crossover Ventures.
Next Story: Game media firm IGN Entertainment to give free office space to indie game startups Previous Story: DEMO: VentureBeat’s Matt Marshall touts tech and farming trends (video)
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robert shumake
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You'll never believe this one, but it appears Keith Olbermann isn't the biggest fan of Fox News. But in case there was any doubt, on last night's Countdown he made it clear again, going after what he sees as the network blatantly ...
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We're over the hump and headed into Sunday. The Kansas City Chiefs are seeing a lot of guarded love. For the most part, people can't ignore our record and at the same time can't ignore our offensive production. Here's today's news.
Former head of Google China, Kai-fu Lee, insists—insists—that he is not happy that Google imploded its business in China. “Seeing the work that I put in, how could I be happy to see that?” he says. In fact, in a press release all about his incubator’s companies being built on top of Android he doesn’t use the G-word once. “Given the pull out, we’ll accept the situation and do our best,” he says humbly. Yeah, accept the situation like a fox.
As Lee begins to open up more about the types of companies being created at his incubator, Innovation Works, there’s a consistent theme—Android. Whether it’s address books, music programs, video games, maps, eCommerce marketplaces or e-readers, many of Lee’s companies are hoping to take advantage of the good things about Android—namely that it’s a free, robust operating system—but customize the core smartphone applications in a way that Google won’t or can’t.
It’s interesting that I had a conversation with Lee about this topic right about the time Google CEO Eric Schmidt was delivering a keynote touting that more than 200,000 Android-powered smartphones are activated daily, going beyond just the smartphone wielding “elite.” Lee would agree with everything his former boss said. It’s just that Google isn’t well positioned to make money off the apps and services in the world’s largest market. Oops.
Lee philosophically may have issues with the lack of openness in the Chinese Web, but it’s also giving him an advantage: The most popular applications for the Android phone like YouTube, Facebook, Twitter or Pandora aren’t available in China, and Google’s native apps may not be the top choice of manufacturers given the search engine’s stance on doing business in the country. So Innovation Works is collectively trying to build a new Web on top of the platform that’s customized for Chinese tastes.
For example, music services that show song lyrics as they play—an essential feature for China’s karaoke loving audience. Another example is a program that automatically enters different dialing prefixes that save money on calls to certain regions. Because 3G is so expensive in China, a video program called Wonderpod downloads videos onto your phone from your laptop at work, so you can watch them without having to stream them on the commute home. An eReader software company lets you read 60% of the book for free then asks for a payment to read the rest. Because of rampant piracy, there’s no chance of selling eBooks without giving anything away for free, but once people are hooked, if they enjoy it, they’ll pay for the rest of the book out of convenience, Lee argues. The incubator is making a few, broad platform plays with an Android-based operating system called Tapas, an analytics tool for developers called Umeng and Ascending Cloud, a publisher of social games.
At most, Lee’s mobile companies are getting a couple dollars per user for these apps so these ideas only become huge companies with massive scale. This can’t be just a game played for the top of the pyramid. And there’s no question in Lee’s mind that Android will be bigger in China than the iPhone, because the cost differential is much more pronounced. Because there aren’t many Android models in the US, hardware makers can price the phones close to the iPhone, but in manufacturing-heavy China prices will almost certainly be driven down much faster.
Lee says the Android devices coming out next year—including manufacturers his companies are working with—cost $200 to $300 per phone. He expects that to fall to around $100 the next year, and possible fall below $100 the year after that. The iPhone will never experience that kind of competitive pressure because only Apple makes it. (Although I could show you plenty of cheaper versions with the an Apple-like logo in the dodgy markets of Shenzhen…)
And there are no carrier subsidies in China, because 80% of phones are bought independently from airtime. So an iPhone will cost around $600. Already Android will enter the market at half the price. For a big swath of the Chinese population that will make a difference, especially if those prices can get under $100 per phone in just a few years with features more tailored for the market.
In a lot of ways, this is a strategy that would only work in China—it’s all about volume and counts on a market with hyper-aggressively competitive gadget manufacturing. But with billions of dollars in venture capital sloshing around China, the market to build the best mobile apps could be as cutthroat as the competition to win the hardware wars. Lee has recently inked some strategic partnerships with Foxconn, Chunghwa Telecom, MediaTek Inc and a raft of global investors to help his chances of being the one to profit from the opportunity.
He’s also moved Innovation Works from Google China’s building to a new location that features what any incubator needs—a hologram that greets you at the front door. I’m not kidding. He told his designer he needed it to look different than any other office and from the look of the pictures, he succeeded. His mobile bets are less certain. But if he wins he’ll have at least one guy to thank: Sergey Brin. A big juicy market opportunity is a lot better parting gift than a watch.
Social games are the rage these days, but making money from them isn’t easy. Gamers play these titles for free, but Adknowledge is figuring out how game publishers can wind up making money from 100 percent of the players.
Adknowledge’s Burlingame, Calif.-based Super Rewards subsidiary is launching a three-part system for making money from virtual currency in games. That could help boost the engagement of players in social games and help raise the revenue generated from each user, said Adknowledge chief executive Scott Lynn. Adknowledge can offer this money-making system as a one-stop shop for publishers and game advertisers.
The three elements include an in-game overlay, offer banners, and a new offer wall for online game publishers. Adknowledge claims the new platform improves the experience for users and increases the number of paying users in a game. Adknowledge is one of a number of companies that give users the option of accepting special offers in lieu of payment for an online game. You can accept an offer such as signing up for a Netflix subscription in return for virtual currency in a game.
But results show that roughly 75 percent of players do not use offers. Super Rewards can target those missing the offers with an in-game overlay, which brings a single, high-value offer to users within a game. The overlay shows up at strategic moments in a game, such as after the initial load. The offers can include promotional language such as “Get More Coins.”
The offer banner uses the space around the main game landscape, presenting a mini version of an offer wall during game play. Users can pay for virtual items at the moment with direct payment methods.
Publishers using the three-part system include The Broth, whose Facebook game Barn Buddy saw its revenue increase 25 percent after using the new system for just five days, said Broth chief executive Markus Weichselbaum. Other publishers have seen a 45 percent increase in the number of new paying users. Adknowledge said developers have seen a 40-percent increase in the number of first-time payers. Super Rewards’ rivals include TrialPay and Offerpal.
Adknowledge has more than 300 employees and $300 million in revenue, making it the largest privately owned internet advertising network. It was founded in 2004 and has grown through acquisitions. The company has raised $48 million in funding from Technology Crossover Ventures.
Next Story: Game media firm IGN Entertainment to give free office space to indie game startups Previous Story: DEMO: VentureBeat’s Matt Marshall touts tech and farming trends (video)
robert shumake
Olbermann On Sharron Angle Video | Fox <b>News</b> | Media Matters | Mediaite
You'll never believe this one, but it appears Keith Olbermann isn't the biggest fan of Fox News. But in case there was any doubt, on last night's Countdown he made it clear again, going after what he sees as the network blatantly ...
Aaron Brown: Cable <b>News</b> Is Too Political
Aaron Brown said in an interview that he is unhappy with the current state of cable news. Brown, who was a prominent anchor on CNN from 2001-2005 and now teaches journalism at Arizona State University, spoke to the online website ...
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We're over the hump and headed into Sunday. The Kansas City Chiefs are seeing a lot of guarded love. For the most part, people can't ignore our record and at the same time can't ignore our offensive production. Here's today's news.
robert shumake
Olbermann On Sharron Angle Video | Fox <b>News</b> | Media Matters | Mediaite
You'll never believe this one, but it appears Keith Olbermann isn't the biggest fan of Fox News. But in case there was any doubt, on last night's Countdown he made it clear again, going after what he sees as the network blatantly ...
Aaron Brown: Cable <b>News</b> Is Too Political
Aaron Brown said in an interview that he is unhappy with the current state of cable news. Brown, who was a prominent anchor on CNN from 2001-2005 and now teaches journalism at Arizona State University, spoke to the online website ...
Arrowheadlines: Chiefs <b>News</b> 9/23 - Arrowhead Pride
We're over the hump and headed into Sunday. The Kansas City Chiefs are seeing a lot of guarded love. For the most part, people can't ignore our record and at the same time can't ignore our offensive production. Here's today's news.
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