DigitalWall - Way to China Internet/Telecom

Why open platform? The root cause is to address the problem of inactive users.

 

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[+] open platforms for big brothers only

 

 

 

The idea of open platform is about a big website releasing its API and allowing others (individual users, small groups or small or medium-sized websites) to write programs in accordance with its API standards and embed the programs in this big website for its users. For website application developers, this mode can be called "follow the big brother."

 

 

 

Why open platforms? The fundamental reason is to solve the problem of inactive users. Social network services are driven by pressure of interpersonal relationships, so in the beginning users would feel compelled to log on the services. After a while, the pressure wanes and about two thirds of users would quiet down. One way to resolve this problem is continue to offer new applications. Yet it is too slow for a website operator to develop applications solely on its own, so it can only open its platform and let others join.

 

 

 

There are several key points in the definition of open platform mentioned in the first paragraph. Firstly, only the major players of the industry have the power to attract others to join. The open platforms of 51.com and Xiaonei.com, two independent social network websites in China, can only work well when they are turning into major players. Yet, keep in mind that the most powerful open platform would be that of Tencent (qq.com), a major Internet Instant Messenger Service provider in China, which can afford to wait for its best chance.

 

 

 

Why do companies follow the big brother instead of striving to be a big brother? This is because the market conditions three years ago could support a startup to grow into a big player. Now it has become difficult for startups - many of them can't even secure financing. Attaching to a major player for a chance to survive is straightforward thinking. Therefore we see a process of industry consolidation.

 

 

 

[+] Benefits for followers

 

 

 

Secondly, applications, after all, are for users of major websites. It is necessary to figure out what kind of applications major users would need. News for Sina, search for Baidu, C2C trade for Taobao, - major websites have their distinct product positioning. In a word, big websites of different types would have open platforms of different kinds; so small players must have different ways to work with them.

 

 

 

Social network services websites have no specific product positioning, which, however, give unlimited space for imagination. They are most powerful in spreading information. Although this type of websites offers specific functions such as blog, photo album, friend list and communities, their actual core product - relationships and networking - is relatively abstract. For applications to be successful, this core must be taken into close consideration.

 

 

 

Thirdly, followers must have benefits. The odds may be poor for a small developer to grow into a big brother, but at least it must be able to support itself. A big brother cannot make smaller developers keep working with it if it does not take care of them. Unless the big brother is the one and only player in the business, otherwise small developers can always turn to other big brothers.

 

 

 

Contrary to the real life, followers on the Internet enjoy certain freedom. They can join different camps at the same time. Developers certainly would like their applications to be used at many occasions without restrictions and make them good money. It would be a lot of trouble if one has to follow different rules (APIs) when joining different camps. Wouldn't it be a lot more convenient if all big brothers have the same set of rules?

 

 

 

[+] Battle for open standards

 

 

 

So we've seen the emergence of a standard that all big brothers are supposed to follow. This is the Open Social standard advocated by Google - a universal standard for open platform. If all big brothers abide by the standards, life would be a lot easier for small followers. They can join different camps freely, and someday they may even become big by being able to benefit from working with many big players.

 

 

 

This scenario is very much like vertical and horizontal alliances in the era of Warring States in China. Google's performance in social network services is only average. But if you look at the list of Open Social partners, you'll find that Google, with this alliance, looks like ready to contend with Facebook. However, what is Googls's intent to develop a standard for all to use, free of charge? What benefits, after all, will it be able to reap?

 

 

 

Overall, the core of Google is search. Google would wish that its Spider and Adsense could reach where there is traffic on the Internet. Nevertheless, social network services websites are very special - they have heavy traffic, yet they, particularly personal profiles, can only be access by logged-on users. Search engines have trouble indexing web pages of these services.

 

 

 

So Google has to open them up, and Open Social can be seen as a product of such thinking. Actually, baidu.com can take the same approach and come up with an open platform standard that suits Chinese social behaviors. It can encourage other social network services providers to adopt this standard, and independent players such as 51.com and xiaonei.com are very likely to join.

 

 

 

Why? Because for independent social network services providers, it would be too risky to rely on a third party standard and too inefficient to develop its own one. The solution then is to "compatibility with all standards." For them, the point is to attract more developers to come up with more applications to stimulate user activities. It does not matter which standards they choose.

 

 

 

In a standardized and transparent Internet world, what can website operators do to retain their users? ( 2008/11/16 - By Digitalwall.com - Way to China Internet/Telecom )

 

 

 

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"To grow bigger" is an inevitable pressure rising from within.

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[+] The Internet was born to be open.

 

The Internet was born to be open and free. Since the time when people established the underlying architecture of communications network, the Internet was endowed with the attributes of a decentralized architecture like its genes. Some negative impacts have come along, such as issues of online security and spams. Yet as such things are the consequences of the working of the Internet's genes, they are meant to subsist. For those Internet businesses that go against the Internet's innate characteristics, they would inevitably face tremendous pressure from competition.

 

Ten years ago, the Internet had posed a severe challenge to the conventional logic of business world – monopoly - , especially of the capital-intensive media industry. The Internet broke the structure and created an opening. An open Internet enabled more content partners to join. Free Internet services quickly drew in a large number of users. People running Internet companies were aware that only through opening up themselves could they continue to grow.

 

As the Internet follows the pattern of scale economy, inevitably, there is always an innate pressure for Internet businesses "to grow bigger." They need to quickly increase their user base and traffic to achieve a comparatively low marginal cost. One way to grow big fast is to offer free services; to open and embrace more partners is another. During the first decade of the Internet, these two methods seemed to work well.

 

Now we've seen a third method emerges with Web 2.0 - social network. The way social network works is similar to multi-level marketing. Spreading from one user's social network to another's and then many others', social network services quickly accumulate a huge amount of users. However, the pressure to grow bigger never wanes. Following the innate nature of the Internet - open and free - , renowned social network services providers have come up with solutions: an open platform and opening up users' profiles.

 

[+] No opening up, no monopoly

 

Doesn't it sound paradoxical? The only way to achieve a monopolistic position on the Internet is through opening up. In the conventional business world, businesses that survive fierce competition would build bulwarks to enclose its empire within and erect competition barriers. This is why we've seen the first-generation Internet companies, such as Yahoo!, developing into new monopolies. It seems that they have followed the same trajectory of history.

 

If its monopolistic advantage can last out, why would Yahoo! have Yahoo! Open Strategy? Why would a monopoly need to open itself up? The reason is new players keep coming on the stage, first Google, and later MySpace and Facebook. They have come with a new revolutionary power to rewrite the old business rules, and on the Internet, the revolution can happen at an astonishingly fast speed.

 

Openness is embedded in the genes of the Internet. It is difficult to monopolize the Internet marked with a decentralized architecture. Internet companies are constantly under pressure for growth, and putting up walls is not good for growing big because no Internet company, however powerful it may be, can monopolize the traffic on the Internet with its own websites - the majority of the traffic is always fall outside its own websites.

 

Moreover, new comers will exercise the power of openness to challenge the success of existing players. One of the most successful products of Google is the omnipresent Adsense, but Google has been threatened first by Facebook, which took the lead to open its platform, and later by MySpace, which was the first to open up users' profiles. They have unsettled both Yahoo! and Google. More openness leads to greater competition.

 

[+] Technological innovation is a key catalyst.

 

The first-generation Internet aggregates and opens up "content;" typical examples are portals like Yahoo!, and issues concerned around copyrights, trading of content and the transformation of patterns of mass communications. The second-generation Internet aggregates and opens up personal relationships; typical examples are social network websites like MySpace, and issues concerned around privacy, property rights of personal data and the transformation of patterns of interpersonal communications.

 

A key catalyst of all the changes is technological innovation, such as standardization of data exchange and standardization of applications interoperability. The former refers to the prevalence of document (e.g. XML) exchange standards and the later the sophistication of Web Service. The former enables users to insert content of one website to other websites; the latter allows users to embed a function module of one website to other websites.

 

10 years ago, when a portal wanted to use the content of a certain media company, both parties would need to go through a lengthy process of program development and docking. Now, website operators share their content in standard RSS format freely. When this becomes a common practice, the barriers to content exchange are instantly pulled down, and content may flow more rapidly on the Internet.

 

The concept of open platform, first raised by Facebook, is to allow applications of other websites to be embedded on Facebook. On the other hand, the idea to open users' profiles, first brought up by MySpace, is to enable users to embed their personal profiles onto other websites. The mode of the former is like "one-stop shopping"; the latter is more like "take out" - portable personal profile.

 

Furthermore, the idea, initiated long ago, to integrate various login ID's for different websites into a universal one, has been back to the talk again. The Internet world is sure to become more transparent with data flowing faster and content and functions among websites more integrated. It will affect the closer integration of industry chains, the decline of old business giants and the emergence of new ones, disputes over privacy issues and so on.

 

Openness is a path of no return, but where is it going to take us? ( 2008/11/09 - By Digitalwall.com - Way to China Internet/Telecom )

 

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