Bas took these pictures last week, and I stole them from his Flickr stream. If you’re in China install this Firefox add-on in order to see the pictures (thanks to the Net Nanny, Flickr’s photo servers are still blocked in China).

It is not uncommon for Chinese companies to make themselves look bigger than they really are to attract potential foreign customers, by making a flashy site and pretend to have offices at a prestigious address. But yesterday I came across a US company that is trying to do the same. The story started last week when I was meeting with a European multinational to discuss about several serious gaming projects that they plan to develop (such as a virtual world or a Second Life presence). The person I talked to told me that they are contemplating to work with a US development studio in Shanghai as well. He told me their name, but I had never heard of them. That is actually a bit strange, because there are not too many foreign-owned (or partly foreign-owned) game studio’s in this city, let alone ones that also make serious games.

So I decided to get in touch with them, to find out how they had ended up here, and see if there are possible ways that we could work together in the future. When I called them, however, it turned out that the address and phone number belonged to another company. The lady who picked up the phone said she did not know much about this company. They did not have an office in China and just used their phone number, but that they have a US sales person with a Chinese mobile number who I could call. The Chinese mobile number she gave me did not work, likely because it was the middle of the night in the US (where this person was based, I found out after a Google search). At first I thought the Shanghai company was their outsourcing company in China, but even that was not the case. The company actually only sells analytical instruments.

It seems the US company just pretends they have a Shanghai office, but is in reality probably just an outsourcing company without telling their clients this. From their (high quality) website you can see that they have many multinationals as clients. They even have a corporate blog in which they describe that they travel around Asia, among others visiting their office in Shanghai. Not sure what they did here (or if they even were here), but likely they did not visit their office. For merchandisers it’s now almost standard practice to visit factories in China before doing business with them. But it seems that the internet industry should also do this in order to ensure they are working with a professional company.

Oak Pacific Interactive is a Chinese company that runs several web 2.o sites, including mop.com and donews.com. After their 48 million USD VC round last year things have gone a bit downhill for them, especially after most of their revenue was cut off last August when China Mobile restructured the service provider industry. Since then they have been cutting costs heavily, among others by laying off lots of employees and moving to a cheaper office.

Likely the VC’s forced them to cut costs, but maybe the investors pushed a bit too hard. On BBS forums mop.com employees are now complaining that the company refuses to put the airconditioning on in the office. Given the fact that Beijing just went through a heat wave, that seems like a bit of a desperate and very short-sighted action. In that kind of weather even the most motivated person cannot do his job anymore.

If I would be an investor in this company, I think it would be time for a serious discussion with the management about how to run a company. Or maybe this action was intentional, and this is a creative way to get rid of more staff without having to fire them?

This afternoon I was strolling around Xintiandi when I saw a nice pair of shoes in a new (?) shoe shop called Silvano Lattanzi. I went inside to take a look at the shoes, and was impressed by all the other models they had on display. I was told that all shoes are handmade in Italy, and I started to suspect that the price may be on the high side. But when I looked at the price of my favourite pair I was literally shocked: RMB 79,990 – more than USD 10,000 for a pair of shoes!

I dont’t mind paying a bit more for quality products, but this is outrageous. In Shanghai I normally pay less than USD 50 for handmade tailored shoes, meaning I could buy 200 pairs of those for one pair of Silvano Lattanzi. The Chinese staff told me that this brand is actually quite famous, but until now I had never heard of it (which does not say much, fashion brands is not an area that interests me very much). They tried to convince me to buy a pair by telling me that royalty and US presidents buy their shoes, but that failed to impress me. Even though the shoes look fantastic, I will stay with my Chinese custom-made shoe maker for now.

Since yesterday I am having problems accessing pictures on Flickr. I did not think too much about it, because internet connections in China are not always optimal. But when it still did not work this morning I suspected there might be a problem at Flickr. When I looked in my RSS reader I found that Shanghaiist wrote a post about it, saying that the Flickr image servers are blocked in China.

That explains why I can still load the site and all the information on it, except for its main feature: the pictures. On the Flickr forum users are all angry at the censors at the Great Fire Wall for blocking the images, and theories are spread about the reasons why (the June 4 anniversary, the student protests in Zhengzhou – apparently still censored in the Chinese press!).

However, I don’t really believe it. Why would the big Nanny decide to only block the image servers? Would it not be much easier to block the whole domain – like they normally do? In that case users cannot even discuss about it on the site, making the censorship much more effective. I think it’s just a mistake in the settings of the GFW, and it will take the censors a few days to discover their error and sort out the issue. I hope I am right – my whole life in pictures is on Flickr and even all the pictures on this blog are hosted there.

The national college entrance exams have started again in China. This yearly ritual is one of the most important moments in the lives of Chinese students. Doing well during these few days can mean access to a top university and therefore a good job and career, temporarily underachieving means going to a lower ranked university (or not going to college at all) and therefore not being able to get a good job in later life. For this reason the GaoKao is hyped up in the media, and websites and newspapers all report about it today.

Not far from my office is a high school where parents were all waiting outside until their kids would come out for a break between exams. It was very crowded and police were making sure the traffic would not be disrupted, and that nobody would dare to blow the horn. The interesting thing was that all parents were all very quiet, afraid that their talking would disturb the kids inside. The parents mean well, but if I would be an exam-taking student it would probably freak me out.

In past years the Shanghai Daily used to run stories about hotels being fully booked by parents that wanted to ensure that their kids would get a good night’s sleep before the exams, so they would have an advantage over their classmates. But this year it seems parents have become even more desperate: the Shanghai Daily’s feature story about the exams reports about parents trying to buy drugs so that their only child would perform better during the exams!

The drug they are turning to is Ritalin, a so-called psychomotor stimulant that is normally used for children that are hyperactive. Parents assume this will help their children to perform better. The drug is not available over-the-counter, and parents tried in vain to get hold of the product at local hospitals. When that did not work they used other strategies, for example asking friends or colleagues with a hyperactive child to buy supplies for them. One mother took her son, who had already recovered from the disease, four times to the hospital to buy the medicine in order to resell it.

Of course also websites sell the product here, claiming that the drug is useful and not harmful at all. A quick internet search disagrees with this though: not only is it dangerous and addictive, but it also can cause fainting, a bad headache, insomnia and nervousness. Drugs.com warns not to take it if you are severely anxious or tense – symptons that are not unlikely to occur during exam time. Parents do not seem to care, however. One mother was quoted in the newspaper saying: “I don’t want to see my child lag behind others even though it is a bit risky. Getting a high score is the top priority.”

This evening I was interviewed by a Dutch radio station about whether people in Shanghai are already excited about the Beijing Olympics. In my opinion the Olympics are not a very hot topic yet among people in Shanghai. Many perceive it more as a Beijing event than as a Chinese one right now. I think that will change, there is still more than a year to go until the Olympics start on 08-08-08 at 08:08 PM. A year is a long time in a fast-paced business city like Shanghai, where people tend to be more short-term oriented. Once the Olympics come closer people will get more excited, and I am sure they will all be proud of ‘their’ Olympics, which likely will be the biggest and best ever.

On TV you see quite some programs about the Olympics already. Showing events from past Olympic Games, or giving updates on how far ahead schedule the construction of all the stadiums is. But these are mainly on CCTV (airing from Beijing) and local Beijing TV stations.

I think that in the last months before the Olympics all Chinese consumer brands will embrace the Olympic theme. Maybe not by using the Olympic logo, but at least by airing TV commercials that are linked to top sports. Some have already started doing this, and also some websites see this as a good way to increase traffic. I just read for example that internet companies Ourgame and Gamlaxy are being investigated for trademark infringement. They were selling in-game virtual items with the Beijing Olympics name and logo on it in one of their multiplayer online games, which is not allowed.

Normally intellectual property (IP) is very difficult to protect in China, and especially so when it is virtual IP, but the Beijing Olympics seem to be sacred. The two companies started their illegal activity less than a week ago, and now they are already under investigation – probably a record.

I have been traveling too much lately, and now I finally had a relaxed weekend in Shanghai. It’s nice to be home and sleep in my own bed, especially after having been away for the the major part of the past 5-6 weeks. I even started to miss making my own breakfast…

Friday around lunch time I arrived in Shanghai from Europe, and I went straight to the office. A couple of things had to be urgently straightened out, so it was good that I had returned before the weekend already. After work I had a burger and some beers with Joeri Gianotten. He used to be the director of Red Herring Asia-Pacific several years ago, and then moved on to Singapore where he worked for RBS/Worldpay. In that position we had contact every now and then about payment solutions in Asia for websites, and he helped me with some research as well. I never met him in person though, we only had contact through phone and email. He now quit corporate life and is doing business development for a social networking start-up (Ammado.com, still in alpha). He was in Shanghai for business and that was a good opportunity to finally meet up. We had some interesting talks, and as usual in the internet business in Asia it turned out we have several mutual friends. I did not stay too late, because I had hardly slept on the plane and was in serious need of some horizontal time.

After a 10-hour sleep I got up at 9 AM on Saturday, feeling fresh and relaxed. I had a quick breakfast and checked and answered most of my Friday night mails. Then Qi and I went to the 100-day birthday party for Xu Huan’s baby. We had a nice seafood lunch with lots of family and several colleagues. After the meal we went home around 2:30, and I decided to have a 15-minute sleep to compensate the couple of beers we had at lunch. A short sleep always does wonders for me, and it also worked this time. Then I drove to Pioco‘s office where I had a meeting with Steve (the CEO) and two friends from the US (Markus and Michele). We talked until 6, when they had to leave for a dinner. I joined my wife for dinner at home and worked a bit until 9 PM when I went out for a beer with Gary. We went to Abbey Road, a nice new bar on Yueyang Lu / Dongping Lu, in the location of the former Cotton’s. It is a nice place and we sat outside in the secluded garden under the umbrellas (the rainy season has started in Shanghai), brainstorming among others about a new business idea we developed in Nepal. When I got home I read ‘The Ascent of Rum Doodle’ that I had bought in Kathmandu – actually a pirated version of the book, like most of the books on sale there. A very funny novel, although a bit dated. I was not very tired but when I finished the book I noticed it was 4 AM already!

This morning I got up around 10, answered my emails and did some research for a blog post on Marketingfacts. I had lunch with my wife and talked with her for a while, while listening to CD from Aaron Neville that I bought. After that I finished the blog post and went to the gym. I still have a knee injury, but decided to try to run a little bit anyway. That went much better than I thought, and I ended up running for 30 minutes at over 12 km/h. Hardly any pain in my knees, and I did not feel tired at all (still in good shape from Tibet). That made me very happy, because I was quite worried about my knees, and I really missed running. Last weekend I did a 45-minute run with my dad over the Lemelerberg and Archemerberg (2 hills in the woods close to my parents house in Holland) and that still caused me a lot of pain. But now things are really improving. I will take it easy for the next few days and really start training again. It was great to be back in the gym, listening to my iPod while overlooking the swimming pool in our compound. I realize I cannot live without endurance sports anymore, it motivates me in my daily life and it gives me so many new ideas.