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Science/Technology
Science/Technology
UPDATED: December 23, 2006 NO.52 DEC.28, 2006
'Maverick' of the Internet
The website Douban.com thrives in a difficult environment by offering something different
By JING XIAOLEI
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A survey by Douban found that the majority of users are between the ages of 20 and 30. Most are college students and white-collars, who have a strong consumption capacity.

"We seldom put money into advertising our website," said Yang. "One reason is that we don't have that much money, and the other, which is more important, is that the word-of-mouth way is more efficient and suitable for our site. Our money is mainly put into developing our products and services, not ads," Yang said.

The success of Douban has triggered a rash of clones in China's Internet world. Similar websites have popped up one after another almost overnight and these imitators have expanded the subjects to a broader range than just music, books and movies to include food, travel and shopping. Some of the copycats have taken Douban's structure and made some small changes, but others have just copied Douban without even changing the website introduction!

"I'm not afraid of these followers and they won't bring much competition to Douban," Yang said. "Many people are studying what Douban is doing and by the time they understand what we are doing, we have already developed something else."

Yang Lei, an IT commentator, said he does not think Douban's imitators will pose a big threat. "Douban's cohesiveness and influence have built up as time goes by and the number of users increases. Besides, Douban targets a special cultural market, which is limited even in the country with the world's largest population, and such a market can be saturated more easily. So the latecomers will wind up in a disadvantaged position."

Too Simple?

But Douban does have a problem that has bothered Yang for a long time. "Someone who first looks at the Douban homepage may think the website is too simple and may not have much content in it because he is used to the traditional websites such as sina.com that look so dense and crowded. As a result he leaves the site and may never come back," said Yang.

"It does take time for Internet users to get used to websites with our simple style," he added.

Douban currently is more like a public service website for readers, music fans and moviegoers: registration is free and not a single ad appears on the website. "In the long run, we will carve out a business model, not just [run it as] a hobby. We want to make money. But the present priority is to cultivate users," Yang said.

In November 2005, Douban released its English version in an effort to gain traction in the foreign market. The move was hailed by Keso, a renowned IT critic, saying Douban might be the first such Chinese website to make its way into the foreign Internet world if the English version performs well.

However, Yang told Beiijng Review that the English-language version had not been as popular as the Chinese one. The first reason is that Amazon.com already dominates the online book market, and the second is that the Douban website is not unique among foreign websites. "So now we have put aside the English version and are focusing on the domestic market," said Yang.

Douban's expenses so far include the cost of operating the domain name, a server trustee fee and staff salaries. The current Douban team has 11 persons: nine full-time employees and two part-time workers. "Web 2.0 websites are small and nimble companies. We only have to have a dozen workers to manage the site's tens of thousands of users," Yang said.

Douban now has a fixed income, which just covers its expenses, from its cooperation with China's online bookstores, including the two leading online book sellers, Joyo and Dangdang. Each book in Douban's database has been linked to these book sellers, and users can compare the prices between them. Once a user buys a book from one of these book sellers through the link from Douban the latter receives a portion of the profit.

According to Yang, Douban currently is negotiating with some publishing houses in China on cooperation agreements but a final decision has not been made. "It's a very healthy business model for the Web 2.0 sites," said Yang. "Douban is of value to both buyers and sellers and this is the basic business model for our site. In the future, when the number of users reaches a certain level, we'll have other profitable forms under the basic model aside from cooperating with book sellers and publishing houses."

Douban has already attracted the attention of some venture capitalists. They came to talk to Yang but all were turned down because he said he wanted to find a far-sighted investor who can see the future value of Douban instead of a short-term collaborator.

"Just like the successful Flickr and Google, I think idealism and commercialization can coexist with each other. I know some have been calling us a maverick website, so let's be a maverick," he added.

 

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