

Who's really making money on the Chinese internet? - biesnecker
http://techrice.com/2011/06/07/the-story-of-wl-chinas-great-internet-divide/

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AllenKids
To understand how "grassroot" Chinese internet companies make money, one does
not need to look much further than Zynga.

They spam low production value wares or blatantly clone the hottest startup in
the valley, engage in ethically questionable business strategies, great guanxi
with officials would not hurt. You think Zynga and Groupon are bad? Their
Chinese copycat are far far worse.

~~~
jhancock
I'm mostly with you...but can you explain how the China Zyngas and Groupons
are worse?

One thing nice about Chinese e-commerce is protection from vendor abuse. For
example, Taobao provides an easy escrow service for buyers. Most others follow
suit. Purchases where you entire your credit card and later find out its
recurring and can't get the billing to stop is nowhere near the problem it is
in the U.S.

~~~
AllenKids
How Chinese Zyngas are worse? Their games can be down right unplayable unless
you pony up real money to purchase virtual goods like coins and potions and
whatnot and they come up with new ways to nickle and dime their existent users
every day, they strip away what was free or available through in game farming
or change game mechanics to make you need more coins or whatever until they
leeches you dry.

How Chinese Groupons are worse? They get merchants to sign up under false
assumptions to do outrageous deals which can get business owners seriously in
debt, they also conspire with some business to commit false advertisement, and
they delay payment, they deflect refund, they lie to both deal hunters and
business owners, they burn money like crazy and their accounting books
respectable firms won't touch with a 10 feet pole.

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stupandaus
I wrote a blog post related to this here:
[http://theagilepanda.com/2011/10/07/chinese-consumerism-
deat...](http://theagilepanda.com/2011/10/07/chinese-consumerism-death-of-the-
knockoff-culture/)

This post was in response to a relevant article here:
[http://www.latimes.com/business/la-fi-china-fake-
phones-2011...](http://www.latimes.com/business/la-fi-china-fake-
phones-20111004,0,7159541.story)

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ezl
Love.

This isn't a piece about china, or developing countries, or even internet
businesses. This is "rich vs king". (1)

There are tons of opportunities out there, but a lot of the good ones are
decidedly unsexy. Getting the most press != Making the most money.

(1) <http://blog.asmartbear.com/rich-vs-king-sold-company.html>

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gbog
There is some truth in this interesting piece, but the dichotomy between
Shanzhai (cheap) and High-end American-like Internet cultures should be
somewhat softened.

For example, the migrant workers are attracted by the more educated part of
the society and their deepest wish is often that their offspring will be part
of the higher society (eg will own iPads).

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rms
Thanks, this is my favorite article on Hacker News in months.

~~~
biesnecker
My pleasure. I thought it was pretty interesting, too.

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rrrazdan
This is so relevant for India as well. Except in the case of India at this
point, the elite are much greater in proportion, but that's because we are
behind China in Internet adoption. And also Internet in India is mostly still
PC based and not cellphone based.

~~~
dextorious
""" And also Internet in India is mostly still PC based and not cellphone
based."""

I doubt internet in the US or Europe is "cellphone based". The great majority
of usage still comes from PC.

~~~
rrrazdan
..as against internet in China, with which I was comparing India to.

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westiseast
It's a nice story of the divide between the modernist Beijing/Shanghai types
and the rest of the country (which makes up a huge proportion of the country).

I wonder though, where do the Groupon type things really sit? They're kind of
more representative now of the Shanzhai culture, the way in which so many
clones have sprung up - and also people are making huge money with them too,
focusing on regional and 'the masses'.

Interesting.

