How the two classes represented in Web 2.0 websites determines the websites' business model.
[+] Class barrier in the brick-and-mortar world
For example, social networking websites like Linkist are targeted at white-collar class. Such websites do not attempt to charge their users as they are reluctant to pay, even though they are better off. Affordability is one thing, and the willingness to pay is another. Fortunately, advertisers are interested in this group of users. [+] Impact of social classes on business model I suppose you, my dear reader, access the Internet from home or office rather than from an Internet cafe, and live in some big city like Beijing or Taipei. You actually have no idea about how people away from big cities get onto the Internet. People of different social classes are used to their specific ways of thinking. Therefore we can find a certain niche market for a certain class. If you look into Alexa's website traffic ranking in Taiwan, you'll find ek21.com outdoing many well-known websites. This website provides the so-called Avatar services, including chat-rooms, voice chatting, personal web-pages, personal web space and icons and so on, which are all potentially profitable services. If you look closer, you will find out that active users on this website are mostly those you don't usually associate with, such as waiters, drivers, part-timers, and people living outside metropolitan cities. Before the emergence of Web 2.0 website startups, ek21.com has been making money for years by charging users. Of course most of its users do not pay, but still it has enough paying users to sustain itself very well. Hard to imagine, isn't it? Because you are a white-collar worker unwilling to pay, it is difficult for you to understand the behaviors of the lower-class people. These people spend money out of impulse. As long as your offering is attractive and does not cost much, you can siphon money from their pockets. However, advertisers are not interested in these people. The population of the lower-class society is huge, and it is even more so in China. There are some very profitable Internet companies thrive on providing service to the lower-class people, such as qq.com. This company has more than 400 million accounts, and their major revenue source is user charges. [+] Consumption behaviors of the lower class If your Web 2.0 website is targeted at lower-class (ex. students or younger people), but you are putting efforts on advertising sales, then I have to tell you that you have missed an important revenue stream: user charges. What services can you charge users for? Look at qq.com and ek21.com, and you'll find easy answers. The point is to sell virtual items rather than sell real world products electronically. The latter is against the nature of Web 2.0. In Web 2.0, it is interpersonal interaction that can help you make money. If you want to know more about the other class, try online games. A few years ago, through playing a then very popular online game "legend," I got to know truck drivers, beetle nut girls, housewives and gangsters - people I would never have the chance to know otherwise. Many of these people do not have an email account; they access the Internet at an Internet cafe, have few ideas about what Google is, and never use MSN. Their favorite online activities are playing games and chatting. This is a blue-collar market, which is beyond your imagination. Similarly in China, young people, students, laborers and residents in towns and small cities consist of the biggest group of users in the market. These people log on the Internet at the Internet cafes where they can play games or chat at just RMB 1 per hour. In small cities where there is little entertainment, online games and chatting can serve as some kind of affordable leisure activities. Any Web 2.0 website which can seize the mass lower-class population is sure to succeed. Even though these people do not make much money, they tend to spend money out of impulses and they are quick payers. [+] Break the class barrier Web 2.0 entrepreneurs are often constrained by the barrier of their class background. When developing online communities, very often they can only base on the life style of the class they are familiar with. Most people cannot do business targeted at a different class of people who live a different life. Yet, many Web 2.0 entrepreneurs confined themselves within an even smaller circle. I once told a startup entrepreneur that it did no good to maintain the elite atmosphere in his website. My suggestion to him was to develop a product that is aimed to be very popular in the market but disgusted by famous Bloggers. In the US where there are over 100 million online users, it takes as few as 100 recommendations to digg a bookmark onto the front-page of the famous social bookmark website del.icio.us. This is pseudo democracy, which is an exclusive game within a bunch of elites. Things like RSS, Tag, Trackback, Wiki, Widget are nonsense created by elites in the upper-class society. When I first saw Web 2.0 technical documents, I thought these things should all go to the trashcan because they were too perplexing for the public. They may not be the root cause for class barriers in the virtual society, but they are surely responsible for making them more difficult to cross. They keep the elites within a wall from the general public, which may lead to restrictions on business. These techniques are still too primitive to be generally accepted by either upper or lower class societies. To make Web 2.0 more accessible, we may need to hide these things or package them in a more friendly way. 2007/05/27 - By Digitalwall.com - Way to
China Internet/Telecom )
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Web 2.0 Think Again (2) Upper-class Society and Lower-class Society - 2007/05/27
Web 2.0 Think Again (1) It's All about Relationships - 2007/05/20
Brief Study at Portable Multimedia Player (PMP) - 2005/05/29
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