Internet Business Thinking

Chapter 10 Internet mobile battle - shopping is within a square inch (1)
(Section [-]) "Small Battlefield" requires great innovation
The first is business innovation, such as application stores, search engines, e-commerce, and social networks; the second is device innovation, including mobile phone hardware innovation, mobile phone operating system innovation, browser innovation, mobile phone input method innovation, etc.; third is business model Innovate to realize the mobile Internet transformation of paper media.

Mobile Internet represents the hottest innovation field at present, and it has also become an important topic of discussion at the 2013 Boao Forum for Asia.At the forum, the participants discussed the development trend, innovation direction, and business opportunities of the mobile Internet industry.

The Innovation Direction of Mobile Internet
At the Boao Forum for Asia in 2013, Wang Jianzhou, former chairman of China Mobile, Liu Qingfeng, chairman of HKUST Xunfei, and Wu Ying, chairman of Zhongze Jiameng Investment Fund, discussed issues such as how to continue to innovate in the next step of the mobile Internet .

Wang Jianzhou pointed out that innovation in the mobile Internet industry mainly includes three aspects: First, business innovation, such as application stores, search engines, e-commerce, and social networks.The second is the innovation of equipment, including the innovation of mobile phones, and the innovation of mobile phones includes the mobile phone operating system—we want to make a mobile phone operating system independently innovated by the Chinese.There are also browsers, and even mobile phone input methods. In addition to the keyboard, there are screen input, voice input, etc. We need to create more input methods.The third is business model innovation.

HKUST Xunfei Liu Qingfeng expressed his opinion on the nature of the mobile Internet.He believes that there are two essential points of the mobile Internet: first, mobile; second, small screen.From a technical point of view, mobile Internet innovation usually includes the fields of transmission, computing, and interaction.Changes in human-computer interaction may be the main starting point for future innovation, and what can be seen is the innovative development of voice technology.It turns out that we all communicate through our eyes and screens.The continuous advancement of voice technology will bring continuous surprises to everyone.For example, last year, after the most stringent traffic regulations in history were promulgated, everyone thought, how to make calls in the car in the future?In the future, as long as you say "I want to call" and "whom to call" with your voice, the problem of making a phone call while driving can be solved.In the future, the functions of mobile terminals and the current Pads and notebooks should be integrated. After the screen continues to grow, the future trend must be that it can be folded, rolled up, or projected.

Wang Jianzhou was very interested in Liu Qingfeng's proposal.In the current situation where there is only one way to use all mobile phones, which is multi-touch, the voice input proposed by Liu Qingfeng made Wang Jianzhou feel quite innovative.He asked Liu Qingfeng such a question: "Many people have used Apple's system and your system. The biggest problem with voice input at this stage is inaccuracy. How to solve this problem?"

Aiming at this problem, Liu Qingfeng obviously had thought about it long ago.He pointed out that the speech recognition rate can be improved through proofreading.The most difficult thing now is technological innovation for accents and noise.But what is certain is that in response to these situations, there will be great breakthroughs in the next year or two.The understanding of semantics and the accurate grasp of application scenarios will greatly improve speech technology.

Regarding the innovation of the mobile Internet, Wu Ying, chairman of Zhongze Jiameng Investment Fund, also put forward his own opinion: the mobile Internet solves the three uncertainties of the Internet.The first is people.In the Internet era, on the Internet, what everyone knows is only an IP address, and they don't know who is using it. The mobile Internet combines mobile phones with mobile terminals, so the factor of "people" is determined.The second is location.In different locations, application needs are actually different.The needs at the Boao Forum for Asia are certainly different from those at a bar in Beijing.The mobile Internet has solved this again, because the location is certain.The third is time.The same people, the same place, but at different times, the needs are different.Combine these requirements, and then imagine this market space—this market space is likely to be dozens of times that of the Internet.

Asian Opportunities in Mobile Internet
Studies have shown that by 2020, a new wave of information such as big data, cloud computing, and mobile e-commerce may generate a global market of more than 20 trillion US dollars.In terms of hardware, Asia is showing a continuous growth trend.For example, among network system equipment, ZTE and Huawei are growing continuously, and Samsung mobile phones are generally favored by consumers around the world.But when it comes to software, Asia is lagging behind—none of the widely used mobile phone operating systems are developed in Asia.So, in terms of regional development, what role should the Asian region play in the new wave of information?At the Boao Forum for Asia in 2013, Wang Jianzhou took the lead in raising such a question.

Vijay Kumar Thadani, president of NIIT in India, is an educator by training.In his view, the largest field of application of the mobile Internet is education.Because educational resources are very scarce now, and there are not many high-quality teachers, but everyone wants to find the best teacher when they are studying.The mobile Internet can fill this gap, enabling people to conduct high-quality learning anytime and anywhere.

For example, in the slums of some countries, teachers from some prestigious schools cannot go in to teach, nor can wired Internet access, but as long as they use mobile phones and PCs to connect, children in slums can use some educational platforms on the mobile Internet to communicate with these famous teachers. Learn.Otherwise, they cannot receive such an education.We want to build an operating system specifically for education, and put limited resources on the operating system related to education.

During the discussion, Tencent President Liu Chiping pointed out that in the global mobile phone IM (Instant Message, Instant Messaging) market, three of the four came from Asia, including Tencent’s WeChat, Japan, and South Korea. some applications of .For example, WeChat has 4000 million users in the global market. In Southeast Asia, especially in Indonesia and Malaysia, we have already occupied the first place in the entire application store and have become the most popular smartphone application in the area.We think this opportunity is unique to Asian companies.

Mobile Survival of Traditional Paper Media

Ji Bin, the president and editor-in-chief of "Lookout" Weekly, believes that the most important aspect of the mobile Internet is the dissemination of content.Mobile Internet terminals form a seamless coverage of the entire audience, and audiences can find news on the mobile Internet at any time, replacing paper media.Traditional media can also intervene in mobile Internet communication through various methods such as Weibo.However, now we are generally faced with the fact that traditional paper media, including newspapers and magazines, can have one or two, three or five good articles in each issue, which is already a good selling point, and it is not easy.

It is undeniable that traditional paper newspapers and periodicals put a lot of energy and financial resources into the manuscript, some cost tens of thousands or 10,000+, and some large reports even cost hundreds of thousands.However, if free dissemination is to be carried out on the mobile Internet, then paper newspapers and periodicals may not have a return channel, and the beneficiaries are often the Internet, often mobile terminals.

In this regard, the United States has made some explorations of paid reading. Arthur Sulzberger. Jr., chairman of the New York Times Company, said: Two years ago, the spread of The New York Times on the Internet transitioned from a free model to a paid model. This is indeed true. Great challenge.Many people are worried that it will affect the reading volume of the newspaper and that readers will disappear.However, after investigation, the "New York Times" company finally took this risk, and its team created a model, which is a partially open model, first of all, a part is free.On the other hand, a link will pop up, and if you want to read on, you have to pay.Every month, users can read free stories, but some content has to be paid.Currently, The New York Times has 64.5 paid subscribers, far exceeding our expectations.

(Section [-]) Baidu’s Mobile Battle Sandbox

The acquisition of 19 Wireless at a sky-high price of US$91 billion seems to be a lucrative deal no matter from the perspective of capital or strategy.The most important thing is that Baidu has completed the layout of the three major entrances to the mobile Internet: 91 Mobile Assistant and Android Market as the entrance to the app store, Light Apps as the entrance to the browser, and LBS as the entrance to the Super App.

On July 2013, 7, Baidu announced the acquisition of 16 Wireless for US$19 billion. 91 Wireless will become a wholly-owned subsidiary of Baidu and operate as an independent company.After the deal was completed, the case surpassed Yahoo's $91 billion investment in Alibaba in 2005.Coupled with the release of mobile products such as Baidu Mobile Search, LBS (Location Based Service, location-based service) and even Baidu Motu, Baidu's mobile Internet puzzle has begun to become clear.

At present, there are 4.6 million mobile Internet users in China, accounting for 78.5% of the total Internet users. The future of the mobile Internet is beyond doubt.But in 2012, when all the companies rushed to the mobile Internet, Robin Li put forward the "Drunk Driving Theory", arguing that the mobile Internet has no business model.Since then, as one of China's largest Internet companies, Baidu has done little in the mobile Internet.

It was not until 2013 that Baidu finally started to make efforts in the field of mobile Internet. Not only did it continue to move, but it also promoted Li Mingyuan, a 29-year-old vice president.It is not difficult to see from this that Baidu attaches great importance and urgency to the mobile business.

So, can Baidu continue its position in the PC era in the mobile Internet field through a series of actions such as the acquisition of 91 Wireless?
Profitable Acquisitions

Baidu spent US$91 billion to acquire 19 Wireless. Is it worth it?
This is a matter of benevolence and wisdom. In February 2013, 2 Wireless tried to land on the Hong Kong Stock Exchange through "introduction and listing".The valuation at the time was no more than $91 billion.In less than half a year, Baidu bought 10 Wireless at nearly twice the price. From this perspective, Baidu seems to be losing money.

But the capital market gave us a different answer.

In historical mergers and acquisitions, usually after the news of the acquisition is announced, the stock of the main acquirer will fall and the stock of the acquired party will rise, especially when the market considers a high premium merger.But after Baidu acquired 91 Wireless, the situation was reversed.On the day the news was announced, 91 Wireless' stock closed down 21%, while Baidu's stock was soaring all the way.Since the news was announced on July 2013, 7, Baidu's stock price has continued to rise.At one point, the stock price hit $16 per share.On July 154.9, the day before Baidu announced the acquisition of 7 Wireless, the opening price of Baidu's stock was only $15.That is to say, after the acquisition of 91 Wireless, Baidu's share price has risen by nearly 97.09%, and the increase in market value has been equivalent to 91 60 Wireless.No wonder Lei Jun, the founder of Xiaomi Technology, said: "Our company is small, otherwise, I would also buy a 11 Wireless."

From a capital point of view, Baidu's acquisition of 91 Wireless is undoubtedly profitable.From a strategic point of view, Baidu's thinking is also very clear.Tang Hesong, general manager of Baidu’s corporate development department, said: “My deepest feeling is that for this kind of large investment and acquisition, the strategy must be clear and you must know what you want. On the issue of acquiring 91 Wireless, I think Baidu’s The strategy is very clear. PCs are shifting to the mobile Internet. Everyone is crossing this river. Many people cross the bridge, and the bridge is a traditional browser; The abbreviation of Application generally refers to applications in various smart terminals), and this ship is an application distribution platform like 91 Wireless.”

91 Mobile Assistant and the Android market under 91 Wireless are themselves one of the largest application distribution platforms on the mobile Internet. In addition, Baidu Mobile Assistant, which has just achieved a daily distribution user breakthrough of 2013 million in the first half of 3500, "After the acquisition of 91 Wireless, Baidu’s content distribution can rank first in China.” As Yan Xiaojia, a senior analyst at Analysys, said, “The one who wins the channel wins the world. Stay at the entrance."

2013年10月1日，百度宣布完成了对91无线的收购，并对外公布了百度91移动分发相关数据：市场份额超过40%，日均分发从6900万增至8000万。

Li Dong, Product Director of Baidu Mobile Cloud Business Unit, said: "91 Wireless and Baidu's mobile assistant user groups do not have a high degree of overlap. Now the market is still in a high growth trend, so at this stage, 91 Wireless and Baidu will maintain their own products. To compete for the market and get the maximum cake."

In the era of PC Internet, what Baidu is doing is traffic distribution, hao123 targets mainstream websites, and Baidu search targets more mass websites, and they each exert their strengths and complement each other; entering the mobile era, Baidu’s value has shifted to application distribution accordingly. The 91 Wireless, whether it is the main direction of attack, or the strategic value, is just like the hao123 back then.

According to reports, Baidu and 91 Wireless have begun to gradually integrate, including platform data sharing and channel sharing plans.

Li Mingyuan, vice president of Baidu, said: "Baidu has four strategic areas in the mobile Internet business, namely mobile search, mobile application distribution, LBS, and mobile video. Among them, mobile search and mobile application distribution are all businesses under the Mobile Cloud Division. The mission of Baidu Mobile Cloud is to build an ecosystem, and 91 Wireless is a means and a supplement for Baidu to build an ecosystem. Therefore, in the future, 91 Wireless will cooperate with Mobile Cloud in many technical and operational aspects. synergy."

Get through the forward charging business

For Baidu, the acquisition of 91 Wireless is certainly to seize the entrance of the mobile Internet application store, but more importantly, this move can improve Baidu's ability to operate developers and the ability to monetize traffic, so as to open up the front of the entire product line. To charge business.Baidu values ​​not only the two mobile distribution platforms of 91 Mobile Assistant and Android Market, but also the developer resources and traffic monetization capabilities of 91 Wireless.With these, no matter what kind of layout Baidu has in the mobile Internet, it will be handy.

Since Baidu provided developers with the "seven major weapons" in 2012, Baidu Open Cloud has opened up more than 20 technologies and services for application developers for free within one year.In 2013, Baidu launched Clouda, a new Web App development framework. It is reported that Baidu Voice API has also been opened to developers.Baidu has never concealed its desire to win over application developers.As we all know, in the traditional Internet, Baidu achieved its final rise by relying on the Baidu Alliance to attract a large number of small and medium-sized webmasters. On the mobile Internet, Baidu naturally established a mobile alliance and tried to use various means to attract more. application developer.

In addition, 91 Wireless' interaction with developers, relationship with developers, and understanding of developers' distribution needs are all what Baidu wants. "91 Wireless has nearly 1000 employees, and my employees include distribution, technology, and products. The total number of employees is less than 100. Baidu's specialty is technology and products, and 91 Wireless's specialty is developer operations." Li Mingyuan said, "91 Wireless is very concerned about developer operations. The company has been operating developers for so many years, and it knows very well what each developer's small, medium, and large demands are, and how to promote the first application. Advantages. Baidu has never done app operation work, but in 91 Wireless, there are more than a dozen employees doing it just for the first launch.”

After the upstream developers are settled, coupled with 91 Wireless's strong commercial monetization capabilities, and Baidu Mobile Assistant's mobile security system and payment platform "Baifubao", Baidu has completely opened up the mobile application industry's forward charging business chain.

On June 2013, 6, one month before announcing the acquisition of 7 Wireless, Baidu had already begun preparations for the acquisition: it announced the adjustment of the organizational structure and the establishment of a forward charging business group. Cham is directly responsible.

Judging from the current perspective, this adjustment is undoubtedly a pavement for the acquisition of 91 Wireless.In this way, Baidu has completed preparations for the forward charging business model both in terms of organizational structure and business.After launching the previous business group business, Baidu has made efforts in multiple aspects including cloud storage, games, reading, music, and video.As Li Mingyuan said: "Baidu has begun to enter more and more vertical industries." Although the forward charging business accounts for a small proportion of Baidu, it has a very considerable incremental market, and its imagination is huge. .

(End of this chapter)