Don’t Buy This Movie

Don’t Buy This Movie

November 20th, 2008 by admin

China’s DVD pirates have gained marketing sophistication in recent years — instead of packaging their wares with nonsense descriptions or blurbs for a different movie, they copy and paste movie reviews from the Internet to help their buyers make an informed decision. Sometimes this strategy goes awry, however. For instance, in Shanghai this past weekend TT bought a copy of the French movie “Cash” (purely for the purpose of writing this blog entry, of course). The blurb on the box (original here) described the film thus: “‘Cash’ is a sad case of Paris playing Hollywood, and failing. The plot is a total ‘Ocean’s Twelve’ knock-off, with bits of ‘Heist’ and ‘After the Sunset’ tossed in. Also, Catherine Zeta-Jones was about a zillion times hotter as Europol power bitch Isabel Lahiri (than Valeria Golino in the near-identical part of a struggling international forgery investigator). Everyone else is even more forgettable, with the possible exception of Ciaran Hinds in the part of Julia’s hard-headed boss. Jean Reno, who appears in the small part of the big counterfeit kahuna, must have owed someone a favor. Don’t waste your time with this.”
Is this kind of mistake a competitive disadvantage for the DVD sellers? Probably not, given that each disc costs just a few yuan. Even a bad review may prove a selling point for those in search of a bit of mindless entertainment.

YouTube Founder Compares Online Video To Nascent TV Market

http://www.techcrunch.com/2008/10/16/kaixin001-chinas-apple-of-social-networks/

by Guest Author on October 16, 2008

Editor’s Note: This guest post was written by Alan Rutledge, who formerly worked as a developer for Idealab, the startup incubator behind Google Picasa and Yahoo Overture.

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Kaixin001, the latest newcomer to the Facebook clone wars in China, is China’s fastest growing social network having amassed a staggering 7.5 million users in the first 5 months since it launched in May 2008. The site tripled Twitter’s traffic reach in the month of September alone and is currently the 250th most popular site on Alexa worldwide.

Compared with rival incumbent Xiaonei, which targets college students, Kaixin001 appeals to white-collar office workers with a simpler UI that is more intuitive to older audiences. This is a significant detail in China, where one in four college students does not own a computer and can only access Xiaonei by walking to an Internet Cafe and paying by the minute. White-collar office workers by comparison, spend an average of nine hours a day in front of the computer.

Kaixin001 succeeds simply by cloning only the most successful Facebook applications and bringing them to the Chinese market before anyone else. Examples of viral hits that they have cloned are:

• Friends for Sale: Females have an unfair advantage in this game thanks to China having one of the highest male-to-female ratios in the world.
• Parking Wars: Ironically most people in China can’t afford a real car, which makes this game all the more compelling.
• iLike: Up until recent crackdowns, the Chinese equivalent allowed you to upload and share your entire music collection with your friends.
• Where I’ve Been: This application defaults to a province map of China because most people have never left the country.

A non-clone worthy of note is Online Storage, a cloud-based file sharing application that harks back to Facebook’s early forays into peer-to-peer file sharing, when Sean Parker of Napster-fame was still president of the fledgling startup.

Blatant cloning may be shunned in the Valley, but in China and other parts of the world, cloning is the expectation of financial backers who benefit from the lower investment risk profile. Being too slow to clone has in fact hurt Xiaonei, which is now being overshadowed by Kaixin001’s 90% month-to-month growth rate.

As a fledgling 20-man startup with limited resources, why does Kaixin001 develop all of its apps? At a time when the Western World is embracing open web platforms, this approach strikes us as counter-intuitive and even backwards. Chinese web platforms, however, face several critical issues:

• Limited access to capital: Venture capital is scarce in China. By comparison, close to a quarter billion dollars has been pumped into Facebook applications to-date.
• Weak online ad markets: Chinese web companies rely heavily on virtual goods and micro-transactions; neither model works for most of Kaixin001’s applications.
• Rampant software piracy: There are proportionately fewer developers available to build 3rd party applications in China due to limited job opportunities as a direct result of piracy keeping the market for software stagnant.
• The Language Barrier: Most open source languages and documentation are available primarily in English. Chinese people who would otherwise make good programmers struggle with this additional hurdle.

The 700 third-party applications on Xiaonei have a huge variability in quality. Kaixin001 has only 25 applications, yet it retains complete control over quality and and has the speed and focus needed to bring well-tuned viral hits to the Chinese market faster than its competitors—perhaps the better strategy in hindsight.

Hundreds of thousands of people quite regularly visit kaixin.com instead of the correct kaixin001.com domain name. Recently, Xiaonei’s parent company purchased the kaixin.com domain name with plans to launch a Kaixin001 clone that would steal its rivals users. This effectively makes Kaixin a clone of a clone of a clone. Amazing.

Kaixin001 was founded by a former executive from Sina.com (the Yahoo! of China) and recently closed a $4-5 million first round from Northern Light Venture Capital.

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CrunchBase Information

Xiaonei

Website:	xiaonei.com
Location:	China
Acquired:	October 24, 2006 by Oak Pacific Interactive

Xiaonei.com is a Chinese Facebook clone that was acquired by Oak Pacific, a Chinese internet consortium for an undisclosed sum. The site mimics… Learn More

Kaixin001

Website:	kaixin001.com
Founded:	April, 2008
Funding:	$5M

Kaixinwang (Kaixin001) is a China-based, Facebook-clone social networking site. Kaixin allows for photo uploading, a blogging and micro-blogging platform, music sharing, and a 1G online hard drive. Learn More

Canada is Not China

Quote du Jour: Canada is Not China

Canada is not China.

-- An anonymous ex-Fed official explaining U.S. eagerness to find Canadian buyers for U.S. banks. "Fed Trolls Canada to Rescue U.S. Banks"

Chinese Dairies Face a Worsening Crisis

http://online.wsj.com/article/SB122176474691453271.html
SEPTEMBER 19, 2008
Slow Response to Tainted Formula Fans Consumer Fears
By LORETTA CHAO
Shijiazhuang, China
As China's baby-formula scandal widens, the country's multibillion-dollar dairy industry is reeling. Consumers, wary of domestically produced milk, are flocking to buy foreign formula and other products, and shares of the country's largest dairy companies are plunging.
A dairy scandal is sweeping through China. Milk dealers have been arrested and government officials fired as milk powder laced with melamine has poisoned more than 6,200 babies and killed 4. WSJ's Loretta Chao reports. (Sept. 19)
So far, 22 companies -- including Olympics sponsor Inner Mongolia Yili Industrial Group Co. and Mengniu Dairy Co., which supplies milk to Starbucks Corp. in China -- have been linked to melamine contamination in baby formula. More than 6,200 babies have fallen ill, many with kidney problems that could lead to permanent damage. On Thursday, the state-run Xinhua news agency reported a fourth death connected to the problem.
Farmers say they haven't heard anything about what might happen to their cows or their milk, which many are throwing away because of slumping demand.
The contamination extends beyond formula to liquid milk, authorities have found. Melamine is an industrial compound used in nonfood products. Its addition to milk can make milk appear to contain more protein to help pass quality testing.
Melamine was found in eight of the 30 Yili products sold in Hong Kong. The government has said it will continue its investigations and provide free medical care to victims.
In this city southwest of Beijing, home of Shijiazhuang Sanlu Group Co., the first company implicated in the scandal, anger is running high among farmers who are being forced to pour their milk into rivers because they have no buyers. Sanlu had been a trusted brand prior to the discovery of high concentrations of melamine. Sanlu, which is 43% owned by New Zealand dairy company Fonterra Co-operative Group Ltd., hasn't responded to repeated requests for comment.
Reuters
Customers return tainted milk powder at a supermarket in Hefei, Anhui province.
Until now, dairy sales in China had been booming. According to market researcher Euromonitor International, revenue from milk-formula rose to $3.1 billion in 2007 from $1.4 billion in 2003, while revenue from other dairy products grew to $17.9 billion from $8.8 billion in the same period.
Liu Jinhu, an analyst for Sealand Securities in Shenzhen, said that if Chinese dairy companies want to avoid being overtaken by foreign counterparts they will have to rebuild their supply chains and practice better corporate responsibility. The milk-powder scandal "might become a watershed for China's dairy industry to find its rebirth," he said. In the long run, it will lead to consolidation and a shuffling of the industry, he said.
Anger is growing that it took Sanlu and local government officials more than a month to report the problem. In a broadening investigation, 12 more milk and melamine dealers were arrested and authorities are looking for others, Xinhua said Thursday, reporting that some of those arrested confessed to buying large quantities of melamine and adding it to milk they resold.
"I will never believe in domestic brands," said Gao Jie , a 22-year-old resident of Pinggu, a Beijing suburb, through sobs. She brought her one-year-old son to the hospital last week because of a fever, and later learned that he had stones in both kidneys after drinking Sanlu formula for half a year. "It's so heartbreaking ... he was clinging to me the whole time in the hospital. And he didn't even have the worst of it; there were screaming children everywhere and some were urinating blood and others were vomiting," she said. She is one of many parents now talking to lawyers about potential class-action lawsuits.

Many travelers are buying imported formula in bulk in Hong Kong and bringing it back to neighboring Shenzhen, border officials say. Retailers plan to stock more multinational brands, but say some parents won't trust even imported brands if they're sold in Chinese stores. Imported formula is more expensive, and out of the price range of many.
Ding Zongyi, head of the Chinese Medical Association's child health professionals committee, says a crisis was "bound to happen" with such poorly regulated supply chains and without proper reporting methods or the ability to trace problems if they occur.
New York-based Bristol-Myers Squibb Co.'s Mead Johnson Nutritionals baby-formula unit, which sells formula in China, uses a "batch code" system to track its raw materials and products. Spokeswoman Gail Wood says traceability is the key factor that's missing with formula makers who use locally produced milk. Mead Johnson sources milk from New Zealand, Australia and elsewhere for its formula sold in China. "Each tank [of milk] is given a vendor number, and that number gets forwarded to every person that buys it. Mead Johnson requires to know, down to the can, [which] tank helped produce [which] can," Ms. Wood says.
Farmers in Shijiazhuang say there's no such system in their county, where there are at least hundreds of cows producing milk for sale.
The dairy industry is a competitive and low-margin business. Farmers sell milk to local dealers who in turn sell it to companies like Sanlu. Authorities say it was the dealers who added melamine to the milk.
The affected companies are scrambling. On Thursday, Yili said in a statement that it has set up a hotline for parents, and that it plans to donate several hundred million yuan annually over five to 10 years to help modernize the industry and develop systems to ensure product quality.
A Starbucks spokeswoman in Shanghai said customers have approached store employees with concerns about the milk used, which is from Mengniu. In a statement early Friday, the company said it decided to stop using the milk as it works with Mengniu to determine its safety. The Starbucks spokeswoman added that is the Mengniu milk the company uses is a high-grade line that hasn't been implicated thus far. The coffee company is in the process of looking at other possible suppliers.—Kersten Zhang, Gao Sen and Sue Feng in Beijing and Bai Lin in Shanghai contributed to this article.

Younger, Nimbler, Cheaper: 'Halfpats' Are the New Expats

http://online.wsj.com/article/SB122111693070023027.html

I went to college at the University of Michigan. During my freshman year, before any of us had really started to venture far beyond our dorm, a friend dubbed Ann Arbor "teen island," referring to the odd feeling of being in a place where everyone was the same age and at the same stage of life. Everywhere you looked you saw yourself reflected back. I never experienced that sensation again in quite the same way until we moved to Beijing and landed in a compound where it seemed everyone was Western, just turning 40 and had two or three kids between two and 10 years old.

This crew, which has been at the center of our social life here, represents the classic expat population -- successful people in midcareer who have been exported, generally at great expense to their employer, to establish a beachhead or expand market share in a foreign land. But these old school mainline expats may be endangered. There is another, growing group of expats in Beijing who are younger, more willing to move around and less expensive to employ.

Talk With Alan

Did you move abroad in your youth? Where did you go? And what inspired you to go there? Share your thoughts.

Beijing and the rest of China have seen an explosion in younger expats because the region has been so economically and culturally hot. Many people come here post-college, some simply to experience the place; some to learn the language or put into practice their college China Studies classes; and others simply because they want to punch the China ticket and give their career a boost.

But the trend towards younger expats is not exclusive to China. "It is a noticeable change which is often discussed by people in the relocation business," says Geoffrey Latta, Executive Vice President of ORC Worldwide, a management-consulting firm. "Companies are interested in sending younger people abroad because they are cheaper and simpler to move, with less family entanglements. And more young people are interested in moving because virtually every field is becoming more global."

These changes are beginning to be reflected in the data, such as it is. The 2008 GMAC Global Relocation Trends Survey of human-resource managers shows that fewer expats are married and have kids than in past years.

"Companies are basically saying to up-and-coming employees that they value international experience and young people are much more open-minded about it than in the past," says GMAC's Scott Sullivan. "In fact, they are often aggressively pursuing these opportunities, sometimes even at cost to themselves, or at least accepting much lower expat packages. They see it as a way to get experience and become more marketable."

The GMAC survey only reflects people who have actually been moved abroad by employers, but there is also an exploding population of "halfpats" -- people who travel on their own. Many of them end up getting onto a career track, even if they arrive overseas initially as students, interns or even backpackers.

Maria Guimaraes

Maria Guimaraes, a public relations consultant from Portugal, is one of a younger breed of expat professionals. She came to Beijing for a three-month internship and stayed.

Beijing is filled with college students and recent graduates studying Chinese at a university or teaching English as they feel their way around the city. Many of them spend some time here and then head home or off to further travels, but an increasing number seem to be sticking around and launching careers, often finding it more fertile soil than their homelands for advancement and experimentation. Because they are often seeking entry-level jobs and generally don't have houses full of possessions to move or kids to educate, they neither expect nor receive the large expat packages that have always made it so expensive for an employer to send someone overseas.

Maria Guimaraes, a 28-year-old Portuguese who came to Beijing for a three-month internship three-and-a-half years ago, now works as a consultant at Ogilvy Public Relations.

"I think three years work experience in China is the equivalent of twice that in Europe because things move so fast," she says. "I have been given a lot more responsibility and worked in a lot more different environments. I don't think Europe or America offers such opportunities to people just starting out."

"And that's in the best of times… right now the job market is not good in Europe. It is difficult for graduates to even find opportunity to prove themselves. China offers more possibilities. I am making two or three times what I would in Spain or Portugal and just learning so much more. This is a tremendously exciting place to begin a career."

Chad Tendler, 28, has worked for Prudential PLC in Hong Kong for three years, after four-and-a-half in Beijing. He came to China after graduating from New Jersey's Drew University, where he studied Mandarin, in 2001. Not seeing a lot of career opportunities in the U.S. in the aftermath of the dotcom bubble burst, he decided to return to Beijing, where he had studied for one semester.

"I just thought spending time overseas would be a great interim move," says Mr. Tendler. Instead he has found a career and a lifestyle he never pondered. He sees himself as part of a growing trend.

"Traditionally there were two main ways for a young person to spend considerable time traveling and seeing the world," says Mr. Tendler. "It was either backpack travel, maybe teaching English so you can get a stipend to stick around some place, or it was the Peace Corps. People still do both of those things, but I think increasingly new graduates are also looking at job opportunities overseas. And they are out there."

Alex Chen, 30, is another young American who has found unexpected career opportunities in China. Now the communications manager of the Opposite House, a luxury boutique hotel, he worked as a producer at the Food Network before leaving at age 26 to study Chinese for a year in Beijing.

"My parents are from here originally and I wanted to be able to communicate with them better in their native language as they got older," he says. "I didn't have a plan beyond the study but living as an expat presents opportunities to reinvent yourself and see what else there is to do out there."

Before landing his current job, Mr. Chen worked for a publishing company and for Warner China and he had little difficulty making these career changes here.

"I could have stayed in the U.S. and been a relatively good television producer, but I wasn't sure I wanted to do that forever," he says. "Coming here has allowed me to have some really interesting jobs and then move on to something else."

Obstacles remain. Longer-term visas have become harder to obtain in China. Many of the visa brokers often employed by halfpats have been shut down and there are rampant stories about expats without full-time employment having to leave China, at least for a while. But there is a widespread anticipation that at the end of September, when the Paralympics are over and this extended Olympics period finally ends, things will lighten up again.

Immigration restrictions can largely be overcome with a good job, but all of the young expats I spoke to think that the golden age of job seeking in China may be over; many opportunities still exist here, they say, but there is more competition. More local Chinese now have good English skills and a higher level of comfort operating in a foreign environment. And more and more young Americans, Australians and Europeans have figured out all this and are coming to China -- and more of them have good language skills, as studying Mandarin becomes more popular.

"The novelty of being a foreigner is really wearing off in Beijing and Shanghai," says Mr. Chen.