Tuesday, January 20, 2009

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 project in China. The first had been PrePaid Project which ended with launch of China's first PrePaid service and SIMcard package. 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, and to raise Nokia's market share.

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

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, they made it clear: “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 aggregated content but they were not really interested in SMS. "Internet on your palm" and WAP browsing hype was strong, nobody was interested about SMS texting. I promised key Chinese portals WAP technical and user interface trainings, but before that they should take small effort to learn and understand SMS, and develop simple SMS services in our Beijing lab. Many agreed and we got forward.

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

China Mobile accepted technical trial to connect SMSC element into mobile network for Internet content. Many twists and turns followed as Chinese wanted to standardize SMS services and introduced complex and cumbersome rules which almost managed to kill interest on SMS.

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, SMEs, or maybe big private software companies would be the best partners. Guanxi, of course, was part of partner selections, but control was the most essential aspect.

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.

These were 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 MANDARIN 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, a lot of confusion was the reality. Repetition of it all was a must.

Left: Roadshows

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

Roadshows took three months continuous traveling for meetings with China Mobile and China Unicom provincial headquarters. Every week trip to another Chinese province and capital city: presentations, MoU and signing, dinners. Also meetings with multimedia developers and multimedia-minded state representatives.

All were eager to learn technical part and work with new SMS services. Often their expectations were more on WAP browsing, but awareness and learning about SMS happened.

IT'S MoU-TIME!
I prepared a 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/portal. With this Chinese operators became aware and wanted to understand new terms and service business, which were included in MoU document.

MoU topics needed presentations to clarify the meanings, and opened discussions for middleware and value-added services/APPs needs. Tens of 3-party MoUs were 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 ready for the market, good for the market share.

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 China's 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 a mobile phone and simcard, post-paid or prepaid. Phone bills are mailed homes and can be paid in banks, not only in few operator's service points. Number of Chinese mobile subscribers continue to 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.


BeijingMan aka Kippo

List of BeijingMan Postings

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Below pictures are from 1999-2001. My first digicam 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 choking 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, 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's President Folke Ahlbäck followed progress of this project, he 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. Beijing Mobile's Kong Wen having a presentation.

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

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

Above-5: June 14th 2000, WTC, Beijing. "Mobile Internet in China" forum. During presentations Nokia China VP C.J. Liu was interviewed.

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

Above-7: May 24th 2000, dinner with China Mobile in Guangzhou. 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, 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, Victor Koo and team open SMS services event.

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

Above-15: May 2000, Xiamen. Fun during team dinner. These people come from four countries. BeijingMan third from left.

Above-16: May 17th 2000, Xiamen. Telecoms Day celebrations. Sohu's Elaine Feng on the left.

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

Above-18: September 2000, Beijing. Roger G. Pineda from Sonera gave 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, Beijing. PT/Wireless'99 Conference was the main event of 1999, organized alongside the telecomm exhibition.

Above-20: November 1999, Kunlun Hotel, Beijing. 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, in western ring-2 office.

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

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

Above-24: June 2000 Kunming, famous Spring city, Yunnan Province near Vietnam. Nokia office was in this low building in city center. Kunming has 3-4 million people, Yunnan Province about 40 million people.

Above-25: June 2000, Kunming, Yunnan Province. Before customer meetings we had get-prepared meeting. Here we are in Nokia 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 made good questions. Kunming has a famous pizzeria with real pizza owen near city center.

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 two meetings, with China Mobile and China Unicom, both were interested about mobile services, especially technical part of it. Spicy food of ChongQing.

Above-29: Summer 2000, Fuzhou in Fujian seaside province. On the way to meeting at Fujian Mobile with Elaine Feng from Sohu. Fuzhou Airport is painfully far from the city center.

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

Above-31: In 2000, ShiJiaZhuang, Hebei Province. Meeting with mobile operator, Sohu's presentation, MoU signing. Trip from Beijing to ShiJiaZhuang took about 4 hours via highway.

Above-32: SPT Infocom Forum'99 - Telecom and Information New Services, Shanghai. Big event where IP was talked.

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 took over 3 hours. City is Haikou, Hainan Province.

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

Above-36: In 2000, HangZhou, Zhejiang Province. Early morning, our team before meeting with China Unicom. HangZhou is famous for West Lake and many small businesses.

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

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

Above-39: July 15th 1999, Singapore. Nokia APAC Developer Conference'99. I joined this with group of Chinese developers. We relaxed in Sentosa island. Cable car, butterfly garden, monkey show, beach and sightseing 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.

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.

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. 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, 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 about 3G. Virgin Mobile's Richard Branson with Right now, Right here by FatBoy Slim.

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.

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, good for the market share. Let's communicate!


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© BeijingMan 2015

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