SMS Texting and Creativity in China

Above: One of China's top portals, Sohu.com promoting SMS text messaging services in Beijing, January 2001. Photo gallery below.

WHAT IS CREATIVITY?
Creativity is ability to choose between right and wrong, answered Chinese university student on China Central TV. Not a word about imagination or new ideas, I thought. But let’s not jump to conclusion.


FLASHBACK: SMS Texting and Creativity in China
SMS MARKET-MAKING PROJECT by NOKIA CHINA

Beijing, May 1999 I started my second market-making project in China. The first had been PrePaid Project which ended with launch of PrePaid service in Beijing. My second project was to activate SMS text messaging business in China. SMS was already popular in Europe but not much known outside. Target of the project was to activate SMS texting as the second mobile service after “voice” in China.

Back in 1999 China had only 0,5 million Internet users but 10 million GSM mobile phone users. SMS Market-Making Project was to work with ecosystem and partnerships by linking Internet content into mobile, and by helping China Mobile and China Unicom to make more business with their fast growing mobile subscriber base.

SMS IS NEVER FOR CHINA
I soon realized that activating SMS in China was not going to be easy and straightforward project.

During many meetings with Chinese representatives, Ministry of Industry and Information Technology (MIIT) and China Mobile HQs made it clear to me/Nokia: “SMS texting is an European success story, SMS will never become a success in China” and "SMS is not for China". SMS for China was simple only in my dreams.

Actually, Chinese approach towards SMS was understandable. SMS was not only a new technology but it was about communication and content. Sensitive issues to learn or decide in China's tradition.

SMS TECHNICAL TRIAL
Chinese Internet portals had a lot of content but they were interested in "Internet on your palm" -hype, WAP-browsing at that time, not about SMS texting. I promised several portals WAP technical and user interface trainings, but before that we would train them to understand and develop simple SMS services. Many agreed and we got forward.

Technical SMS learning was fast. Soon SMS tests were made at our lab in Beijing HePingLi. When Internet portals' personnel learned more about text messaging, their curiosity won and word went around. They liked it and studied European success stories.

China Mobile accepted technical trial to connect SMSC element into mobile network for Internet content. Many twists and turns followed to Chinese wanted to standardize SMS services and introduced rules.

MUCH TO LEARN
In all, technical part of SMS was easy but there was a long list of other topics to learn. Revenue sharing was a great challenge as mobile operators wanted 100%. Discussions were whether official multimedia bureaus, or small or maybe big private companies would be the best partners. Guanxi, of course, but control was essential.

Marketing, partnerships, product management and business related issues were all new in emerging Chinese market economy. And often people interpreted and defined new business topics in their own way, which then took same extra time.

In 2000 these were very new topics in China:

• Branding - Marketing - Segmentation
• MoU - Business Model - Partnership - Revenue Sharing
• IPR - Content - Ringtone
• Value-add - Win-Win principle - Empowerment
• Service product - Service product management - Flat rate
• Pre-launch procedures - After-launch procedures
• Launch - Press Release
• Feedback - Customer satisfaction

NEW WORDS INVENTED
There were cases when Chinese needed to compose new words to describe above issues and new SMS services. Since Chinese organizations are big and China is as large as USA or Europe, repetition of it all was a must.

ROADSHOWS
After Beijing we did roadshows to introduce mobile services and SMS service examples in 15 Chinese provinces. That's about half of China.

That meant three months organized traveling and meetings. Every week trip to new Chinese city and province: presentations, meetings, MoUs, dinners.

We met with mobile operators and multimedia minded state participants. All were eager to learn technical part and work with new SMS services. Often their expectations were more on WAP browsing, but learning about SMS happened.

IT'S MoU-TIME!
I prepared MoU document as a tool to introduce new terminology and business opportunities to provincial operators. We proposed to sign a 3-party MoU: operator, Nokia, and content. With this Chinese operators became aware and wanted to understand new terms and service business, included in MoU document.

MoU's topics needed presentations to clarify and opened discussions for middleware and value-added services needs. A lot of 3-party MoUs got signed.

CHINA SMS BREAKTHROUGH
Final breakthrough came via Sydney Olympics Games 2000 with a Chinese idea. Top Chinese dotcoms knew SMS and made a smart offer to send “good news" text messages to mobile phones when Chinese athletics won medals. Phone number registration via web was needed. China Mobile accepted the idea and "good news" SMS started to peep-peep in tens thousands handsets.

SMS-based "good news" text messages became an eye-opening success. Chinese dotcoms probably got never paid for that idea and service. But suddenly everyone was eager, ready and willing to take more business opportunities with SMS texting.

LOW TARIFF
China's decision to start SMS with very low tariff made it match for mass market. Later the tariff for MMS was set high and service became a flop: my recommendation for MMS tariff was 0,5RMB but much higher values were set. Fast growing mobile subscriber base opened opportunities for new developer companies (hundreds of them) to start business with their SMS ideas, content and games.

CREATIVE OR RATIONAL
I saw a Chinese painting, hills covered by mist. My Chinese friend told me the painting was creative.

I asked him to tell more. He said "It's that mist. You can imagine anything you like since there is the mist. Your creativity is enabled by the mist".

In case of SMS texting, Europeans might call Chinese creative choice only as rational business choice. but creativity was there when SMS was activated, Chinese student on CCTV didn't have it all wrong. Behind the mist were choice and decision. SMS was let into China and it gave birth to creative industry of Chinese developers and service providers.

SMS Market-Making Project took 1,5 years, till the end of 2000. It achieved its targets: Chinese got new way to communicate, and Nokia had the best texting phones in the market.

Epilog
During my 10+ years in Beijing I have been part in China's transformation from state planned economy towards market economy. Nokia filled Chinese pockets with communication tools, and WTO agreement filled China's streets with cars.

In 2009 number of Internet users is over 600 times higher. There are 50 times more mobile subscribers than in 1999. Numbers expanded, not only because of actions taken by service providers or mobile operators but because Chinese people want information and want to communicate.

MOBILE SOCIETY - CHINA
Now Chinese can easily buy mobile phone and simcard, post-paid or prepaid. Phone bills are mailed homes and can be paid at banks, not only in few operator's service points. Number of Chinese mobile subscribers will grow steadily 4-7 million per month still several years. Growing subscriber base makes operators' business easy and provides them time to learn until saturation and real competition.

SMS text messages have become part of Chinese culture. In 2006 Chinese sent a billion SMS per day, in 2009 several billions. Over 10% of SMS messages carry content from Internet. Over 10% of China Mobile's ARPU (average revenue per user) comes from SMS. SMS is now Chinese lifestyle, Chinese success story and win-win for everybody.

Now mobile value-added services compete in China and everyone wants to understand Chinese directions in mobility. Now China has better mobile networks and handsets are overflowing with features. And mobile operators want to raise non-voice part of ARPU but lack clear vision.

NEXT MOBILE BREAKTHROUGH - WAIT WAIT WAIT
Years and many China projects later the question still is: what will be the next breakthrough service after SMS? Music, flash, browsing... long wait, is it lack of idea, technology or strong push?


BeijingMan aka Kippo

List of BeijingMan Postings

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Below pictures are from 1999-2001. My first digicam, 1998, was Kodak DC260 with 1,6 megapix and zoom. Back then Chinese PPTs were sometimes colorful but using real images of people/places in PPTs was new.

Above-1: 13th May 1999, China Mobile's branch Beijing Mobile, BMCC, XiDan data center. Celebration of my first project in Nokia China: PrePaid. In China, red envelope usually contains money. But in these we have China's first PrePaid simcards. In the middle Nokia China VP Arnold Malcolm, I'm in back row, right.

For PrePaid Project I established a new IN (Intelligent Networks) group. IN-system was delivered to Beijing Mobile's XiDan data center for trial. My new team had series of meetings and seminars with BMCC's personnel. They needed to make a lot of decisions and choices to enable the PrePaid service. In Nokia we were very busy. We carefully processed every detail that BMCC asked or requested from us. Specialists from abroad were continuously needed. Nokia China President Folke Ahlbäck followed progress of this project and was frequently updated.

Left: PrePaid simcard package.
Beijing May 13, 1999

Prepaid Project took eight months. Beijing Mobile had very smart people and we all worked hard to make this happen. Project ended with capabilities demo to BMCC and Nokia China management, followed by commercial closure. Soon after, Siemens won major role in Chinese prepaid market with their tailor-made solution. Nokia's solution was strictly standards-based and Nokia was not willing to modify. I started SMS China Market-Making Project mid-1999.



Above-2: March 2000, Beijing. China Mobile SMS/WAP services launch event. BMCC's Kong Wen having a presentation.

Above-3: June 14th 2000, WTC in Beijing. "Mobile Internet in China" forum.

Above-4: June 14th 2000, WTC in Beijing. "Mobile Internet in China" forum, presentation by Duncan Clark, head of BDA China.

Above-5: June 14th 2000, WTC in Beijing. "Mobile Internet in China" forum. While presentations went on in the main hall, Nokia China VP C.J. Liu gave an interview.

Above-6: May 24th 2000 at China Mobile in Guangzhou, GMCC, in Guangdong province. My presentation was about mobile services, portal for content distribution, and importance of active Chinese developer community.

Above-7: May 24th 2000, dinner with China Mobile in Guangzhou. China Mobile's Monternet, brand for mobile Internet services, was very new.

Above-8: May 2000, Guangzhou International Hotel. View from 60th floor over city jungle.

Above-9: May 2000, Hefei in Anhui province. Meeting and dinner with China Unicom.

Above-10: May 2000, Hefei in Anhui province. Dinner with China Unicom, handshakes with China Unicom's representative and Elaine Feng from Sohu.

Above-11: March 2000, Beijing. A media event. Charles Zhang, CEO of Sohu (left) and C.J. Liu, VP of Nokia China.

Above-12: Meeting at Sohu.com, Beijing JianGuoMenNei office. These are real first moments of mobile services via live network in China.

Above-13: January 2001, Beijing. CEO of SOHU.com Charles Zhang and his team at their SMS services event receiving applauds.

Above-14: May 2000, Xiamen. Meeting with China Mobile soon to begin. Person on the right? Maybe an earlier visitor:)

Above-15: May 2000, Xiamen. Having fun during team dinner. These people come from 4 different countries. BeijingMan third from left.

Above-16: May 17th 2000, Xiamen. I participated Telecoms Day celebrations. Sohu's Elaine Feng is lady on the left, I am 2nd from left.

Above-17: May 2000, view over Xiamen city.

Above-18: September 2000, Beijing. Roger G. Pineda from Sonera giving a presentation to China Mobile. Topic: how to make more business with large and growing subscriber base. At any rate, top presentation, to the point.

Above-19: November 1999, Kunlun Hotel in Beijing. PT/Wireless'99 Conference was the main yearly event in China, organized together with exhibition.

Above-20: November 1999, Kunlun Hotel in Beijing. Doing presentation at PT/Wireless'99 Conference.

BENEFITS OF PARTNERSHIPS. At PT/Wireless'99 Conference my presentation was about benefits of partnerships, content and operator, Internet and mobile network, within the value chain, win-win-win principle which means growing faster together. Value chain and partnering was new in China, with big Chinese question why to share.

I also introduced pre-launch/after-launch procedures and service product management/life cycles with examples from European markets.

Above-21: January 2000, Beijing. We had meetings about mobile services with China Mobile HQ, CMCC, then located at western Ring-2.

Above-22: December 9th 2000, Beijing. With Victor Huang from CHINAdotcom. Wi-Fi or 3G, that was the question! Victor went to faster Wi-Fi.

Above-23: March 17th 2000, Shanghai in China Unicom Tower. After the meeting with Shanghai Unicom about mobile service enablers.

Above-24: June 2000 Kunming, famous Spring city in Yunnan province near Vietnam. Nokia office was in this low building in city center. In China's scale Kunming is "medium" with 3-4 million people. Yunnan province has about 40 million people.

Above-25: June 2000, Kunming, Yunnan province. Before customer meetings we have a get-prepared meeting. Here we are in Nokia's Kunming office. Left side, in blue, is legendary Nokia China person Tuure Vilppola. I am at right.

Above-26: June 2000, Kunming, Yunnan province. Presentation during meeting with mobile operator. These were active people and had good questions. Kunming ia a pleasure, and that famous pizzeria with real pizza owen near center even more so.

Above-27: June 2000. In front of Kunming Hotel with Sohu.com guys. Sohu had plenty of Internet content for mobile phones.

Above-28: In ChongQing, city of over 30 million people, I had meetings with China Mobile and China Unicom, both were interested about mobile services, especially technical part of it. Spicy food was good in ChongQing.

Above-29: Summer 2000, Fuzhou in Fujian seaside province. On the way to meeting at Fujian Mobile with Elaine Feng from Sohu. Fuzhou is a relaxed "medium" size city. It's airport is painfully far from the city center.

Above-30: Summer 2000, Fuzhou in Fujian province. Lunch time.

Above-31: In 2000, ShiJiaZhuang in Hebei province. Meeting with mobile operator, Sohu gave presentation, MoU signing. Trip from Beijing to ShiJiaZhuang takes about 4 hours via highway. City has about 10 million inhabitants.

Above-32: SPT Infocom Forum'99 - Telecom and Information New Services, Shanghai. Big event where IP was talked but, then, Cisco really wasn't taken seriously by telecom.

Above-33: Group photos are great fun! SPT Infocom Forum'99 - Telecom and Information New Services in Shanghai. Photo above is only 1/3 of it all. Front row third from left, BeijingMan:)

Above-34: August 2000. Flight from Beijing has taken over 3 hours. This city is Haikou in Hainan province, an island in South China sea.

Above-35: August 2000, Haikou in Hainan province. Colleagues in mobile services. I returned Hainan for holidays, driving around and Sanya beaches.

Above-36: In 2000, HangZhou in Zhejiang province. It's early morning, our team before meeting with China Unicom. HangZhou is famous for West Lake and many small businesses. "The most beautiful city in China", claims a TV advertisement, I would add the word "probably" in front.

Above-37: June 30th 1999, Shenyang in Liaoning province, north from Beijing. Lunch with Neu-Alpine (Neusoft) in software park. Shenyang is former steel city with 10 million inhabitants. Later a JV with Nokia China was established.

Above-38: July 1999, Nokia APAC Developer Conference'99 in Singapore. After 6 hours flight from Beijing arriving to Singapore.

Above-39: July 15th 1999, Singapore. Nokia APAC Developer Conference'99. I joined this with group of Chinese developers. We had time to relax at Sentosa island. Cable car then butterfly garden, monkey show, beach and sightseeing train.

Above-40: Singapore view, July 1999. Clean and lawful. And the weather was hot.

Above-41: July 1999, Beijing. Dinner with Neu-Alpine in a goose head restaurant. I had three crispy half-heads with cold beer.

Above-42: July 4th 2001, signing papers in Hangzhou, Zhejiang province. Hangzhou Technical University was interested about mobile services. Nokia had tools and information for developers and students. University joined to Nokia NetPoint which was a pre-Forum Nokia service.

Above-43: July 4th 2001, Hangzhou in Zhejiang province. Snake for lunch at Hangzhou Technical University.

Above-44: Shanghai. Reflective view from Intrinsic Linktone's office at Harbour Ring Plaza in Shanghai. Round building is Shanghai Museum, good to visit, excellent.

VALUE CHAIN AND SUCCESS. During SMS market-making project I met over 100 Chinese dotcoms, early service providers, emerging mobile games and applications developers, content providers, and many traditional, large Chinese corporations. Each of them wanted to take role in mobile services and we at Nokia supported that development.

Some of those companies became leaders in Chinese market: MagusSoft, a creative pioneer in mobile gaming, Sohu.com portal, Linktone from Shanghai, more. Some had no clue what to do. Some had strong relations and wanted ideas.

Above-45: July 20th 1999, Dalian in North-East China. Neu-Alpine's new software center soon ready in Dalian. It was a hot and windy day. Dalian is a modern seaside city with good seafood.

Above-46: October 24th 1999, ZhengZhou, Henan province. Presentation about mobile services and value chain for mobile operator. ZhenZhou has 10 million people, and Henan province 90 million.

Above-47: April 3rd 2000, Beijing. We introduced mobile banking to several Chinese banks. Actually, BeijingMan's background is in banking and mainframes.

Above-48: May 18th 1999, Beijing. MCB-meeting with MII/China Mobile. Second from left my then boss Craig Johnson, straight and very clear. Madam Li MoFang (right) from China Mobile / Ministry of Industry and Information Technology (MIIT).

Above-49: September 1999, Beijing. HP was interested about mobility. Yomi Media's Paivi Rapilo presenting.

Above-50: October 2000, Shanghai. Sonera ZED had great ideas about mobile future. Later Sonera became part of Telia, Sweden, TeliaSonera.

Above-51: In 2000, Hong Kong. Victoria Park seen from Hotel Park Lane where breakfast is good:)

Above-52: In 2000, Hong Kong. WAP fever peeking. Everyone was interested about "internet on your palm" hype, while my project was about getting SMS into Chinese market.

Above-53: May 2001, Beijing. For roaming, mobile services need technical solutions and agreements between operators. Sonera's Sam Ekblom visited Beijing to introduce GPRS roaming solutions. We did tourism in TianAnMen, Rost Room and Forbidden City.

Above-54: September 5th 2001, Beijing. Related to booming ringtone business and IPRs we met Music Copyright Society of China, MCSC, royalty collector.

Above-55: November 22nd 2000, Praha in Czech Rebulic. Visited Mobile Internet Conference, major European event. Large delegation from China participated this event, which had a presentation by VP of China Mobile.

Above-56: February 22nd 2001, Cannes, France. Participated 3GSM World Conference and Exhibition. Conference was all about 3G. Virgin Mobile's Richard Branson with Right now, Right here by FatBoy Slim, but 3G-urgency didn't realise.

Above-57: February 22nd 2001, Cannes, France, 3GSM World Conference and Exhibition. Nokia advertizing 3G near Cannes conference center. In China 3G has been postponed to give time for TD-SCDMA get mature.

Above-58: February 22nd 2001, Cannes, France, 3GSM World Conference and Exhibition. Nokia China President Urpo Karjalainen gave speech to large Chinese delegation during dinner in Nice near Cannes.

Above-59: April 2001, Barcelona, Spain. Nokia Developer workshop. That city is all about modernist works of Spanish architect Antonio Gaudi (1852-1926) and Las Ramblas walking street.

Above-60: April 2001, Barcelona, Spain. We made a dinner trip to a castle outside Barcelona where I got snapped.

BREAST GROWING RINGTONES. While sitting in Barcelona I couldn't imagine that 5 years later some in China would make sales success with breast growing ringtones, and that Chinese experts explain on TV that ringtones doesn't work that way. Breast growing RTs happened earlier elsewhere without experts explanation.

Above-61: April 2001, Barcelona, Spain. Nokia Developers workshop. Dinner in a castle. Everyone seeks innovative services for mobile.

Above-62: March 2001, Hong Kong. Nokia announcing 3G Applications Lab for developers.

Above-63: SMS Market-Making Project in China was a lot of fun. But it was also planning, travelling, meetings, and a lot of learning. It took 1,5 years, till the end of 2000. It achieved its targets: Chinese got new way to communicate, and Nokia had the best texting phones in the market. Let's communicate!

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© BeijingMan aka Kippo 2008, 2009