Today it’s 5.12 and it’s exactly one year ago that a huge earthquake hit Sichuan province. Last year most entertainment websites, including Tudou, game.com.cn and xiaoyouxi.com, shut down for 3 days because of the national mourning. Today you will see that many sites on the Chinese Internet changed their look as well. Tudou for example did not show any ads on its homepage during most of the day and the homepage had a different look and feel – only black and white with some Tudou orange.

Last year Tudou had the first video of the earthquake on the site, shot during the earthquake. The person uploaded it to Tudou immediately after the earth stopped shaking. The film was viewed over 5 million times and the guy who made it won one of the Tudou Video Awards this year because of his reporting. In total there are now about 30,000 films on Tudou about the 5.12 earthquake, and as a reminder of what happened to everybody we put them all together here.

Rupert Murdoch’s announcement that he does not believe in free content on the Internet made me think a bit over the weekend. So far I have always said that I believe that everything on the Internet will eventually be free. I still believe that for the majority of the content this will be the case, but the more I think about it the more I see that a shift may be coming.

If you look at music for example, even though most music is available for free if you search for it, many people are willing to pay for it online. iTunes is big business for Apple. The trick is a combination of an application that is easy to use, with a great user experience and a relatively low price. iTunes combines all three of these. They have a huge catalog of music, from mainstream to very obscure, that is easy to find, easy to download and easy to pay for. You see a similar thing with e-books, if you want to find free versions of books and know where to look for them, you can find them. But Amazon announced this week that 35% of its book sales are e-books (figure still seems incredibly high to me), people prefer to pay for them.

In games you also see similar things. In China you cannot charge anything for a game, people do not want to pay for them because they are available for free all over the Internet and very easy to find as well. But does that mean that Chinese users are not willing to pay anything to have a better gaming experience? No, they are willing to spend money. That’s why virtual goods took off over the past 3 years, and it has become a huge revenue stream for many game companies. Even if the basic service (=the game) is free, people are still willing top pay to enhance the service.

Something similar might happen to news. I don’t think people will pay subscriptions to online newspapers like they do with paper versions, at least not at the same rates that newspapers are currently asking for. But there are other business models possible. First of all it’s important to realize that putting a paper behind a firewall will lead to a huge decrease in the number of readers, which leads to a lot less advertising income (currently the main source of income for online papers). But not only that, you also immediately lose a high Google ranking because links to your articles either don’t work anymore (if you also put the archive behind a firewall) or because nobody will link to you (because readers who click on the link would have to pay, so linking does not make much sense). This means that a paper should think very seriously about the consequences before making this decision.

I think news is available for free everywhere on the Internet, so you cannot charge for it anymore. It’s too late for that now and trying to do that will lead to failure. But you can charge for other things. For example, make the basic paper free (all news stories as sourced through news agencies) and make sure the quality is as high as it used to be. But put other parts of the paper (for example the art, books, travel or real estate section) behind a paid firewall. Link to these articles from your basic free paper but only give the first 1-2 paragraphs (or a summary) away for free. In this way you still have the link in Google, and people might still link to it.

But don’t try to sell subscriptions for this – use micro-payments! Charge a very small amount of money for it. So small that nobody really thinks twice about it. How much? You would need to do some research on this, but likely less than 5 cents (USD cents) per article. If that’s the case many people might decide to read the article, psychologically a few cents does not hurt your wallet.

This will only work if there are easy payment solutions. If you have to get your credit card out first or need to go to Paypal it wont work. There should be a 1-click solution, you click and you have access. Newspapers should cooperate on this, they should come up with a standard payment solution for all newspapers together. E.g. buy a credit online that can be used for all newspapers online with one click. Just like it works with game cards in China, they can be used with many games and only when the credit is used in a certain game that operator gets the money.

I believe micro payments combined with advertising might be a solution for the online newspaper industry. But of course there are other solutions possible. I believe paper newspapers will eventually die. They are just too expensive, both in terms of the material used and because of physical distribution. E-book readers will get better and better and will eventually be so good that the user experience will be as good (or even better) as the old traditional paper newspaper. I therefore believe e-paper will take over the mass media market. Costs will be a lot lower (because no paper and no distribution costs) and the paper could be updated continuously. Newspapers need to reinvent themselves for this for this.

A subscription to a newspaper on an e-book is still a bit too conservative in my opinion. I think you need to think one step further: newspapers should work together and offer combined subscriptions. Because the variable costs for e-papers are zero (or almost zero) the papers should work together and offer a subscription to all papers together. At the end of each month you can do a calculation based on actual usage per newspaper and split the revenues. It’s as simple as that. The customer has more freedom, the paper can still put ads in its e-paper version, and only the quality or marketing of the paper determines whether more people will read it.

This model could be combined with the micro transaction model that I described above: users get credits when they subscribe and use these for non-free content online. And these credits can of course be used for every paper. With these credits a whole new world of possibilities opens up, think about what happens if advertisers start giving away credits.

Just a few thoughts on a Sunday night. I have a lot more ideas about this, too many for a blog post. I am sure News Corp’s Freemium teams will come up with a lot more and a lot better ideas. I look forward to their results and to what News Corp will eventually implement.

I now start to believe that users might accept that they have to pay for good content, but it depends on how you implement it. I also believe that content will only get better when the creators get paid for it. Rupert Murdoch might be able to change the current rules of the game – or at least initiate the change.

Yesterday I was invited to a shareholder brunch for the opening of M1NT‘s new rooftop terrace. I had been there a couple of times during the pre-construction already and was impressed by the end result. The terrace now has a wooden deck with tables, white pillow couches and a hammock with a view over the city. To get a tropical feel they even built a waterfall on the roof. In the middle there’s a well-stocked bar, where M1NT’s Danielo Hotti and his experienced cocktail staff were making excellent drinks all afternoon.

The brunch was as good as expected. Chef Dan Segall was busy running around all the tables serving everybody with salads (we had 6 or 7 salads in total, from simple tomato salads to an exquisite Thai salmon salad) and all kinds of barbecued meat and fish. Lamb, beef, pork, chicken, salmon and large shrimps, the food was all excellent and kept on coming. And so did the drinks: there was a free flow of wine and cocktails, and each time my glass was almost empty a new one was already put in front of me. That’s how I like it!

What I also like were the free head and neck massages that were provided. A few massage girls walked around the venue and gave everybody who wanted one a massage. Heavenly while sitting in the sun sipping on a Pimm’s cocktail!

From next weekend on you can try out the M1NT rooftop terrace brunch for yourself. For RMB 398 you get unlimited high quality food prepared by Dan Segall himself (he told me he will be in charge) and all the drinks you want on the rooftop terrace with the best view in town. More expensive than the average brunch in town, but you’ll get value for money. Looking forward to seeing some of you there this summer!

Last night I was following the launch of Amazon new e-book reader on the Internet through Twitter and Engadget’s live blog. The new e-book reader was named Kindle DX and is much bigger than the original Kindle. It seems to be especially designed to read newspapers and magazines on it.

As regular readers know I have been using e-book readers for several years already (I used to have a Sony e-book reader and am already using my second iLiad), and I am a big fan of this product. From the first time I used them I believed they would be the future of publishing, but I also realized it would take years to convince people how good e-paper really is. Amazon made a big difference for the industry when it launched the Kindle in 2007, and now it make another big splash by introducing a big screen version of its e-book reader.

My first impression of the new gadget: pretty good. The design is a lot better than the original Kindle (which was plain ugly) and the Kindle 2 (a little better), but is not up to what Apple would have approved had they designed it. There is still a keyboard below the screen for example, which looks a bit awkward. The screen size is a lot better than the original Kindle, which I felt was way too small, but is 9.7 inches big enough for the average consumer to read a normal paper or magazine on? That’s what Amazon’s Jeff Bezos is betting on, together with a whole bunch of newspapers that will be available for this e-book reader. For all of you in Shanghai, the Shanghai Daily is one of them.

I have been using an iLiad reader for over a year now to read the Dutch NRC newspaper (not available on the Kindle by the way, shame on NRC!), and for me the 8 inch screen is big enough to read the paper as long as it is properly reformatted. Note that it took NRC almost a year to get that right, although there are still articles that are messed up. If you want to read the original formatted paper, such as on PressDisplay, you need a bigger screen. And in that case i think the Kindle DX is not big enough. I assume, however, that all newspapers do their own formatting, so then that problem should be resolved.

iLiad manufacturer iRex already has a product that has an even bigger screen than the Kindle DX, the iRex Digital Reader 1000. The screen is 10.2 inches and the device is a lot better looking than the Kindle. It has been offering 800+ newspapers on it through PressDisplay since late last year, but for some reason the product did not break through. The reason: the high price and very bad marketing. The Digital Reader costs EUR 587, which is just too much for the average reader. The Kindle is not cheap either at USD 489, but at least they got the marketing right. Just compare the iRex website with the Kindle site on Amazon: iRex is only looking at the product and its technical specifications, not at trying to sell it to consumers. You need to show customers what you can do with it and what content is available. iRex was the first to offer tons of newspapers on its device, but it’s not using it to market its product. Now Amazon plays the game right and markets its product as a breakthrough for the newspaper industry. Smart move and a huge missed opportunity for iRex.

I think the Kindle could be a big success despite its high price tag and despite the fact that it is lacking both a touch screen (which means you cannot underline things or write notes in books) and wifi. Amazon is getting pretty good at hyping its products and creating a buzz. Despite having a better product iRex won’t be able to be beat Amazon with its current marketing strategy. The only real threat for Amazon would be if Apple would come up with its own e-reader, but so far there are no signs of that. I am still hoping that will happen one day!

For the past couple of weeks we have been working on developing a new business idea for games. The new business will be part of Spil Games Asia, but we will run it as a separate entity that has to be profitable by year end. For obvious reasons I cannot disclose here what we are exactly planning to do, but it has to do with MMO games. We plan to hire 3-4 people who will be in charge of our new business, they will operate and grow the games under my supervision.

Who are we looking for?

• Ambitious young college graduates (or similar), who want to live and work in Shanghai for at least 1 year (preferably longer!).
• Foreign nationals (preferably from the US, or having lived in the US for several years) that spent at least 1 year in a Chinese university or Chinese nationals that studied at least 4 years in the US
• Fluent English and good spoken Chinese, sufficient reading abilities to play Chinese MMO’s without having to use a dictionary
• Game players – if you’re not an active MMO player you do not need to apply
• Active Internet user (Blog, Facebook, MySpace, Twitter etc.)
• 2-3 year working experience would be advantageous (esp. in order to get a Chinese working permit)
• Entrepreneurial spirit: we are going to build a business together, there is nothing yet except for a plan and some funding, and we need to launch within 3-4 months
• No programming skills necessary

The ideal candidate would be someone who spent some time working in the US and then decided to study Chinese for a while in China. After doing this for 1-2 years he/she would like to stay on in China to continue learning the language and to gain some more work experience in a young and very dynamic organization.

This is not an expat job with a big package: you will work in a start-up in small group of young people. A work hard, play hard environment. If your main goal is a good salary, this is not the job for you. Your main objective for applying should be because you love games, you like to work in Shanghai and you want to get some valuable work experience in the online game industry.

If you think this descriptions fits you, please send me an email at marcvanderchijs (at) gmail (dot) com. Feel free to forward to anybody that could be interested! We will start hiring immediately, but if you can only start in 2-3 months you can apply as well. Headhunters and recruitment agencies: no need to respond.

Last Friday I was having a drink at the rooftop terrace of Bar Rouge with friends visiting Shanghai and we were looking at the Peace Hotel next door. I told them that the place had been under re-construction for ages and that I wondered if it would ever reopen.

The Shanghai Daily answered my question today, writing that the hotel should reopen in March 2010. Searching my old blog posts I found that the hotel closed its doors for renovation in early 2007, so when it opens again it will have been closed for almost 3 years. Have they been working on it for the past years or did the negotiations take years to finalize?

According to my favorite Shanghai English language paper (luckily for them they have no competition) the new name of the hotel will be the Fairmont Peace Hotel Shanghai. The landmark property on the Bund will keep its Art Deco style but the interior will be completely renovated. The Fairmont will offer 250 room and suites, with prices between USD 300 and 400 – several times higher than the prices before the renovation. Hopefully the Fairmont will manage the hotel better than the former owners, because it used to be a total mess. I stayed there a few times in my early China years (around 2000 or 2001) and I remember that there were always problems with the service, the rooms or the noise.

By the way, I wonder whether the Fairmont Peace Hotel will get its own Twitterstream as well. I noticed that last week the new Fairmont in Beijing started following me on Twitter, so who knows I might soon be able to tweet with the new Peace Hotel 🙂

Just now I was checking whether Google already indexes my new site www.chijs.com (to be officially launched in a couple of days after uploading some more press articles), when I suddenly saw a result for a Wikipedia page for my name. I was very surprised because I had no idea somebody created one for me. The page contains a couple of mistakes, but I am afraid the Wikipedia rules do not allow me to change those.

I wonder who wrote the article? I can probably find that out on Wikipedia, but I did not figure out yet how to do that (history only shows 2 changes in late March this year). It’s likely a Dutch speaking person, because there are links to two Dutch articles. Feel free to let me know in the comments or in a private email if you are the original author. I am honored!

After my blog post about Air Asia‘s treatment of its customers I received a email from the company telling me that the USD 3000 that they have been sitting on since January will be paid back to me in 30 to 60 working days! Worst case that means an additional 3 months of waiting to get my money back. Ain Izzaty, a customer support staff at Air Asia sent me the following explanation why it takes ‘some time’ to pay me back the money they owe me:

I will explain to you why it takes some time to process it. Once the agent place the queue for refund in the systems it will escalated to their manager on duty to verify and approve then the manager will escalate it to the finance department, and once finance department received the report they will check with our accounts department and then they will send the report to the bank. Kindly take note that Air Asia finance department is not based in Kuala Lumpur, its based in Thailand.

Bank will take some time to process it and transfer the fund to your bank, all this process normally takes 30 – 60 working days to process from the date your booking placed on refund queue excluding Saturdays and Sundays. The process get delayed sometimes if there is any problem between bank to bank transfer however the problem will be solved by the bank. We have escalated this matter to finance department to check with the bank and speed up the process. Thank you so much for your patience all this while, kindly check your credit card statement from time to time. We will email you the status once we get the reply from the finance department.

Thank you for flying with Air Asia.

Air Asia, this is total bullsh*t. I used to work for a multinational in finance and know exactly how these procedures work. They can be done in hours or maximum a few days, not months. Do you really think that it makes any difference that your finance department is in Thailand and not in Malaysia? Or do you transport your payment instructions by bicycle from Kuala Lumpur to Bangkok?

You are just delaying the payment as much as possible and the customer is obviously not important to you. I hoped the issue would be solved after the long phone call on Friday, but you’re only making it worse. I know you are a low-cost airline but that’s not a justification to treat your customers like dirt. Short-term thinking will hurt your long-term results. The end result is that you lost a customer and that I do not mind spreading the word about this.