My Internet Notebook

Apparently Yahoo thinks the China consumer market is too important to ignore. They have plan to introduce the popular Flickr service to Chinese markets, starting a rollout in Hong Kong and Taiwan.

Yahoo already has a photo sharing service in China, which is similar to Yahoo Photo in the U.S. While the service, which is free, is pretty good, they have only about 9% of the market share. According to iResearch, Netease.com Inc. took the largest share with 43.4 percent followed by QQ.com with a 33.9 percent share, though other media companies such as Sina Corp. are fast catching up.

How to make money from photosharing in China is still not clear. Being used to free photo sharing services, Chinese consumers may not be thrilled by paying for a Flickr premium account. But if there are enough entertainment values in an offering and it does not cost an average person’s one month salary, you may be able to find a business in online photo sharing after all.
Yahoo to launch Chinese version of photo site in 2007

Xinhua-PRNewsWire reported that China’s largest out-of-home multi-platform life-style media company Focus Media (Nasdag: FMCN), has announced that it has entered into a definitive agreement to acquire Allyes Information Technology Company Limited, the largest internet advertising service company in China. This acquisition will enable Focus Media to enter China’s growing Internet advertising market.

According to a new report released by China Internet Association, the online advertising market in China reached RMB $4.98 billion in 2006, and is projected to grow at 50% annual rate to reach $11 billion in 2008. No surprise that FMCN wants a piece of the action as well.

The Wall Stree Journal reports that the leading Chinese language search engine Baidu.com is entering the Japanese market.

This looks to be a high risk bet on Baidu’s part. While the Japanese search market is large and tempting (10 times bigger than that of Chinese search market), the risk associated with such as a big undertaking can never be underestimated. For one, Yahoo (with local partners) and Google already owns the majority of the internet search market there. Secondly, Google is breathing down at Baidu’s neck in Beijing to try to steal market share away from Baidu. This is like, for Baidu, openning up two big battle fronts at the same time, while the resource at Baidu’s disposal is substantially smaller than either Yahoo Japan or Google. Maybe Baidu should be contemplating a secondary public offering of shares pretty soon.

Now outsourced tutoring has been increasingly reported in the news: latest from SF Chronicle (Sunday 10/22/2006). One of the India firm Tutor Vista even snatched a $11 million investment from Sequoia Capital.

So how big is the market potential? According to Tim Wiley, senior analyst at Eduventures, an education and research consulting firm in Boston, it is a $2.2 billion private tutoring market in the U.S., which reached 1.9 million K-12 students last school year. Although TutorVista’s ambition goes beyond U.S.

And how much can this outsourcer make? Growing Stars, which began offering tutoring in 2004, serves 400 students who pay $21 to $25 per hour. TutorVista, which started in November 2005 and charges $20 for a 45-minute session or $100 a month for unlimited hours, has 2,000 students and aims to reach 5,000 by next fall. That’s not a lot of money. But they pay only between $300-450 per month to their employees, compared to about $40-$60 a private tutor makes per hour in the U.S.

“They (Google) created a bunch of crap that they have no idea what to do with,” said Rob Enderle, principal analyst of the Enderle Group. This is how one analyst described the frenzy scene of google’s new product rollout, ranging from digital maps to a search engine for product catalogs.

The top brass at the company seems to agree: “I was getting lost in the sheer volume of the products we were releasing,” said co-founder Sergey Brin.

Details at Los Angeles Times.