Dr Gang Lu (China) - In Focus: China's Microblogging Revolution

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• Posted by Dr Lu Gang

• on May 16 2011

The microblog, Sina Weibo, launched in August 2009. It now has over 100 million users; the ‘Tencent' Weibo was launched around April 2010, and now is reported to have 160 million users. This explosion of users has led to Weibo being the hottest sector in the Chinese web industry.

Innovation vs. Copycats

The concept of Weibo is no doubt inspired by Twitter. However, since the first day Weibo launched, the product has been customized for China. Considering the BBS (online forum) phenomena in China, people have got used to how the BBS works, i.e. you publish a post, and then others can reply to it so that you can see the entire thread of the conversation. Twitter only provides three simple formats; tweet publishing, re-tweeting and direct messaging. On Twitter site it's hard to view the conversation between you and your friends. In Chinese Weibo, the use of BBS is proving to work very well. You can publish a tweet which other users will directly reply to; as the reply message appears just under the tweet on the same page. So the conversation in Weibo is a lot more user-friendly.

Platform vs. Service

Sina's Weibo is more like a platform than a microblog service. A few products have been launched with Weibo integrated. For example, Weituan is Sina's group-buying aggregator service. Unlike other group-buying aggregators that organize deal information (such as tuan800, 360tuan etc.), Weituan, with its Weibo service integrated, has many more social features.

You can easily share a good deal of information with your followers on Sina's Weibo. Given that Weibo is now the most powerful social media channel in China; the integrated nature of Sina's products can be expected to attract more consumers. Sina even developed a credit system which encourages the Weibo users to share the deal information that the Weituan service manages: if you share one group-buying deal, you are given one point. If you participate in a deal, you will earn five points. The points can then be redeemed for a special discount. On Weituan, you can also check out what your friends are interested in. You can even tweet about the deals you want to start. Weituan can secure deals if your tweet is popularly re-tweeted.

Weilingdi is another interesting service bundled with Weibo. It's similar to Foursquare. Basically if you login with your Weibo account, your check-in action (by default) will be shared on Weibo with your followers; and when you check-in, you can even see the list of Weibo users around you.

Sina vs. Tencent

Sina and Tencent are the leading Weibo service providers in China. As Sina's Weibo is absolutely dominating Chinese web space, Tencent will soon face direct threats to its core service, QQ. Technically speaking, Sina's Instant Messenger UC client has been developing for years; and from a strategic point of view, the partnership between Sina and MSN strengthened Sina's IM ambition. It's reported that Sina has started working on integrating its Weibo service with its UC, or even MSN. With a fast growing base of users, Sina might become the primary enemy to Tencent in the near future.

The business model

How microblogs make money? Twitter's answer, so far, is sponsored tweet, promoting trends and data analysis for enterprise accounts, which isn't always easy. The CEO of Sina recently disclosed its six business models for making money:

1. Interactive precision advertisement;
2. Instant search;
3. Paid digital content;
4. E-Commerce platform (ref. Sina Weibo's microcoin);
5. Social Game;
6. Wireless value-added service;

Conclusion and Market Prediction

According to Meg Lee, the general manager of Sina, Hong Kong, the market is predicted to fully mature in 2013. She explained four implications of this prediction:

• Unique Weibo users will take up 30% of total users
• The relative growth is slow downing, yet the absolute growth rate remains rapid
• More people will use Weibo as a marketing platform, with measurable profits being  generated
• Active collaborations between Weibo and other SNS/internet services will continue to form

The Chinese Weibos are not just a new media broadcasting platform, but also a message/information exchange and sharing platform, an e-commerce and business promotion platform. The Weibos are ever developing into integrated webs of services. The future certainly looks bright, especially for Sina.

By Dr. Gang LU, Founder & Chief-Editor of TechNode.com. Gang is a well-known internet business observer and adviser in Asia/China, and co-founder of OpenWeb.Asia Workgroup and kuukie.com.