Weblog with daily updates of the news on a frugal, fair and beautiful China, from the perspective of internet entrepreneur, new media advisor and president of the China Speakers Bureau Fons Tuinstra
Showing posts with label Matthew Brennan. Show all posts
Showing posts with label Matthew Brennan. Show all posts
For Douyin, the presence of arts content as dominant verticals echoes the attentions of the platform’s early millennial adopters. “It started with a core user base of trendy urbanites and art students in the early 20s demographic,” says Matthew Brennan, author ofAttention Factory, a book chronicling the rise of parent company ByteDance. “By 2018, Douyin had gone fully mainstream.” Douyin’s warp speed growth was encapsulated by October 2017 during which the app’s users jumped from seven to 14 million and the average time spent in the app doubled to 40 minutes. The growth signaled a reach far beyond the initial Millennial and Gen Z users, and prompted a change of slogan to the all-encompassing “Record Beautiful Life.” Three years on, that vision includes “more than the classic dance, lip-sync, and comic content categories,” says Brennan, and touches upon the full spectrum of cultural content.
Embroidery is one such area. “I had some craft skills before, but I’ve really learned a lot through watching short-videos [on Douyin and Kuaishou],” says Han Yunyin, a retiree in Shanxi province. “Seeing other people’s [embroidery] abilities inspires me to buy more materials and continue making more myself.”
This cultural focus is increasingly driven by ByteDance itself. With more than 600 million daily active users, Douyin appears to have saturated the domestic market — though such predictions in the past have proved premature — and the Beijing-based company’s focus has turned to maintaining its audiences and extending user time, stickiness in industry parlance. Similar to YouTube, Douyin’s appeal rests with content not socializing, says Brennan, and with product teams having seemingly exhausted in-app innovations, the focus will rest on ensuring Douyin platforms unique, quality content. Arts and education are key to this strategy with Douyin self-identifying as China’s largest knowledge, culture, and art platform with nearly 15 million knowledge-based content videos in 2019.
The application uses a very powerful recommendation algorithm, which adapts to needs and interests of each one of the accounts associated with your database. Proof that this mechanism works is that, as of today, it has registered 800 million monthly active users.
In an interview with BBC Mundo magazine, Chinese technology and innovation specialist Matthew Brennan highlighted the following regarding the engineering team that TikTok has:
«There is no small team behind. It is one of the largest internet companies in China. Employs thousands of people. If TikTok has grown so fast is due to the experience of its engineers as it operates the best recommendation engine in the competitive Chinese market.>>
According to Brennan, author of Attention Factory: The Story of TikTok and China’s ByteDance, this platform is being a major rival to Instagram and YouTube. Both social networks offer the option to upload videos of different lengths, which people search in their spare time according to your personal interests or search for individual social status.
What is the difference with other similar platforms?
The main difference that Brennan finds with other digital platforms, such as YouTube or Netflix, is that the user does not interact with the screen. In the case of TikTok, yes. For this reason, the app receives much more feedback from its consumers.
Hundreds of fashionably dressed young people were arriving at 751 D.PARK, an expanse of industrial plants redeveloped into a hip culture venue in northeast Beijing. They were clad in baseball caps, brightly colored dresses, loose-fitting hip-hop style streetwear and limited-edition sneakers. The site had been transformed into something akin to the stage of the talent competition “American Idol,” spanning two floors filled with strobe lighting, high-volume music and trendy backdrops. This was an exclusive party — three hundred top Douyin creators coming together to celebrate the app’s one-year anniversary.
The online stars, billed as the “new generation of internet celebrities,” weren’t there to just socialize and enjoy themselves. Every influencer was aware of the unspoken competition to derive the best content from that night. They were all fighting to achieve a higher level of superstardom and the medium of battle was short video.
The influencers who knew each other gathered in small groups as their assistants tirelessly captured fifteen-second videos of their carefully crafted skits. Loners roamed around the dance floor, absorbed in finding the ideal lighting for their lip-syncing selfie videos. Lesser-known influencers nervously approached more famous ones, proposing to record a dance together to potentially tap into their peers’ following. Loud hip-hop music kept playing in the background as creators hurried to touch up the videos they had just shot. Once the editing was done, they uploaded their works and anxiously waited for the app’s algorithms to judge who would grab more eyeballs.
Dance teams took to the stage to display their skills. The crowd bopped their heads back and forth as rappers attempted to impress with clever lyrics. Later as the hosts were midway through giving out awards, a wave of noise erupted from the back of the crowd interrupting the proceedings.
It was Yiming. Dressed in a black baseball cap and gray T-shirt and accompanied by Lidong. The audience went wild — the CEO had decided to drop in unannounced! Immediately he was bombarded with requests to take pictures and videos. As those around him whooped and cried out wildly, the entrepreneur simply smiled and kept his hands calmly by his side, an awkward 34-year-old engineer type among the hyper fashionable, mostly teenage hip-hop crowd.
He already knew from looking at the data, but this was confirmation in the flesh — Douyin had built a robust community, with powerful momentum and was on the verge of doing something special.
October 1st marks the beginning of “Golden Week,” a seven-day-long official Chinese national holiday. Periods like these are big opportunities for China’s internet industry. People’s behaviors change for a week; many find more time for entertainment and to try new things.
Over October, Douyin’s daily users doubled from seven to 14 million; two months later, they reached 30 million. Over those three months, the 30-day retention rates jumped from eight to over 20%, the average time spent in the app soared from 20 to 40 minutes. It was as if some magic rocket fuel had suddenly been added, boosting every key metric. What had changed?
The answer was Zhu Wenjia. Zhu Wenjia, hired from Baidu in 2015, was widely considered to be one of the top-three best people in the entire company when it came to algorithm technology. He ran one of ByteDance’s most capable engineering teams and had recently been assigned to work on Douyin. The team’s work harnessing the full power of ByteDance’s content recommendation back end led directly to the astounding October results.
“Why are moms using Tiktok? Why is anyone using Tiktok?” shouted the world’s most popular Youtuber towards the camera. It was late 2018 and Swedish gamer Pewdiepie was recording his second of fifteen “Tiktok Cringe Compilation” videos after the first had proved to be a hit. Each episode was ten minutes of him reacting to painfully embarrassing Tiktok videos.
Tiktok hadn’t paid anything to Pewdiepie. The A-list global internet mega-celebrity was creating video after video about Tiktok because his audience loved it. This should have been the kind of authentic influencer promotion that online marketers dreamed of. Every video was essentially a free ten-minute advert for Tiktok distributed out to a loyal 80 million follower base. Yet, at the same time, Pewdiepie wasn’t exactly endorsing the app.
Tiktok was bizarre. An endless stream of people posting weird content with almost a total lack of self-awareness. Mindless comedy skits, lip-syncing, and just outright wacky oddball creations. The kids making these videos could be forgiven; they were just kids. But the adults posting on the app came off simply as creepy and weird. Countless numbers of Tiktok cringe compilations started appearing on Youtube, many with millions of views. Criticism of the app became widespread, with the shaming of Tiktok users becoming a regular occurrence on Twitter and Reddit.
In China, Douyin, the domestic version of Tiktok also operated by Bytedance, had first garnered attention as a popular app for urban youths, associating itself with art students and fashionable hip-hop lovers. Yet in America, it was the absolute opposite. Tiktok had entered the public consciousness as a cringe app for losers and misfits. What was going on?
For a while, London was in the running to get the Tiktok international headquarters, but under the Tiktok-Oracle deal the UK’s capital seems to have lost that opportunity, says China internet watcher Matthew Brennanto CNBC. That seems another setback for the UK now the country is already suffering under the corona crisis and Brexit.
CNBC:
Less than a month ago, there was talk of putting TikTok’s international headquarters in London, but that looks increasingly unlikely.
“Assuming the Oracle/Walmart deal goes through, then the HQ for TikTok Global for sure is in the States,” said Matthew Brennan, a social media analyst based in China.
“For London to be the HQ of a company like TikTok would have been a coup for the city, but alas it seems not to be,” Brennan told CNBC, adding that it would have greatly raised the prestige of London in terms of attracting international tech talent.
Bytedance’s Tiktok, known in China as Douyin, has for the first time disclosed some of the figures on its usage. Tiktok is only starting to grow, says internet watcher Matthew Brennanto CNBC. “You ain’t seen nothing yet, it’s still getting started,” he added.
CNBC:
Duoyin and TikTok are both owned by Beijing-headquartered ByteDance. Over the last few weeks, ByteDance has released some closely-guarded user numbers that show just how popular both apps are.
Slowly but surely, ByteDance is painting a picture of how many people use its video sharing apps in each region.
Brennan thinks that China is two years ahead of the U.S. and Europe when it comes to short video. “The big question is the ceiling,” he said. “Where will TikTok/Douyin usage top out? If China hasn’t reached that ceiling yet, that means TikTok very likely has at least two to three years of strong growth left.”
Brennan pointed out that Douyin had 200 million daily active users in 2018. “Now it’s 600 million…that’s an instructive bellwether for TikTok’s potential growth in Europe and the U.S. for 2020-2022,” he said.
“You ain’t seen nothing yet, it’s still getting started,” he added.
Oracle has taken over Microsoft as the preferred buyer of Bytedance's Tiktok in the US after the Chinese company got into problems with US President Donald Trump. Innovation expert Matthew Brennan says Oracle might be the better match as a buyer of Tiktok, he tells in Coinspeaker.
Coinspeaker:
ByteDance will be the overall decision-maker on who to sell its product to. Preferably, one that will offer the best cash deal, which both Oracle and Microsoft are capable of anyway, or one that will not pose a direct competition threat in future for its venture, where Oracle highly wins.
“The perfect company for Bytedance to sell to is one with deep enough pockets to pay a good price,” said Matthew Brennan, a social media analyst in Beijing.
Brennan added that the buyer should be “good enough at tech to actually run all the advanced AI (artificial intelligence that TikTok has)” but weak enough at consumer mobile that they would avoid arming a future competitor. “By these measures, Oracle sounds like a good fit,” said Brennan.
Oracle is actively providing the CIA with its database software solution, and the acquisition of China’s huge tech company might be a gateway to spying the Chinese market.
In addition, Oracle’s acquisition of TikTok will be a plus for the struggling company to venture into new markets and presumably the social media industry.
China internet giant Tencent has a gigantic investment portfolio, but has a rather hands-off approach when it comes to those investments. Tencent watcher Matthew Brennanexplains at Technode how to look at that strategy.
Technode
According to Matthew Brennan, founder of research consultancy China Channel and co-host of Technode’s China Tech Talk podcast, Tencent’s relatively hands-off approach can be attributed to the experience and personalities of two of the company’s top decision-makers: Executive Director and President Martin Lau, and Chief Strategy Officer James Mitchell. “Both Martin and James think more like investment bankers than operations-focused managers,” explains Brennan. “Much of Tencent’s profit generation still lies in gaming, a sector in which they are known to take more controlling and larger stakes. Yet for the rest of their investments, they seem comfortable trusting existing management and taking a much less active role.”
As of the end of Q2 2019, Tencent reported an investment portfolio amounting to over RMB 417 billion (about $59 billion), including China and overseas.
Tencent might still dominate social media in China with WeChat and QQ, but competition is heating up, and the internet giant is preparing for more competition, says Tencent watcher Matthew Brennan in Asia One.
Asia One:
"WeChat and QQ are like huge ships … too big to change course to catch a new trend before others," said Matthew Brennan, managing director of consulting firm China Channel.
WeChat and QQ both saw quarter-on-quarter declines in monthly active users in September, while in the same month Chinese netizens spent 42 per cent of their online time using Tencent apps, down 4.2 per cent from the same month last year, according to a report from Chinese data analytics firm Quest Mobile...
Tencent also fends off potential competition by blocking access to its ubiquitous WeChat, which has resulted in accusations of monopoly practices.
Early this year, links to three social media apps - Matong, Duoshan and Liaotianbao - were blocked from opening within WeChat's browser for "containing unsafe content and receiving user complaints", according to Tencent. None of the three potential competitors has been able to pose a serious challenge to WeChat.
"Social applications have a high rate of failure. Hundreds of WeChat challengers fizzle out, but it doesn't mean Tencent can stop trying," China Channel's Brennan said. "Innovations can still appear, often unexpectedly, so it's sensible for a company like Tencent to have new teams out in the field to explore the boundaries."
Consumers, often, are all but forced to use some super apps, like it or not. In Hangzhou, the birthplace of Alipay, a number of restaurants, coffee shops and supermarkets only accept the e-payment service. Similarly, few people bring stacks of business cards to conferences in China -- they simply add each other on WeChat.
With two out of three Chinese on WeChat, the app "is so ubiquitous" that it has essentially become a "public utility," said Matthew Brennan, managing director of Shanghai-based tech consultancy China Channel, who specializes in WeChat-based marketing.
"It is like your phone number, water, gas and electricity," Brennan said.
As popular as it is now, WeChat is still in expansion mode. Tencent has made companies and developers an offer that is hard to refuse: They can build a mini-app for WeChat cheaper and faster than a conventional app...
Companies that helped drive WeChat's rise are showing they are not necessarily wedded to it. Brennan, who is writing a book about the super app, said top Chinese ride hailer Didi Chuxing used to rely on WeChat to attract passengers. Now, he said Didi -- which is also backed by Tencent -- gets about 90% of its orders through its own app.
"They want direct access [to users]," Brennan said. "Otherwise, their business is at risk."
Facial recognition and the exchange of related data seems to meet little resistance in China, compared to Western consumers. Tencent observer Matthew Brennan sees some rubbles among the public, but indeed no big scale anxiety on facial recognition, he tells in Slate and dives into the different perceptions.
Slate:
Matthew Brennan, co-host of the China Tech Talk podcast, is hesitant to make blanket statements—pointing out that plenty of cosmopolitan Chinese share values and viewpoints with Westerners—but he does suspect that facial recognition is widely accepted in China for deeply cultural reasons. He calls China a “low-trust society, while Western societies tend to be high-trust.” Brennan chalks that difference up to rampant scams, from street corners to social media feeds, that have long plagued the People’s Republic of China with uncertainty.
Oddly enough, that lack of trust typically doesn’t apply to government higher-ups or the cutting-edge tech firms linked to those officials. Instead, those upper echelons are often seen as sources of strong leadership or innovation that can root out lower-level, local corruption, including scammers and unscrupulous neighbors. A recent Bloomberg article unravels that paradox by describing an app piloted in one Chinese city, through which users can report what they deem to be dubious behavior of fellow citizens to the authorities. It goes on to say, “Depicted outside of China as a creepy digital panopticon, this network of so-called social-credit systems is seen within China as a means to generate something the country sorely lacks: trust. For that, perpetual surveillance and the loss of privacy are a small price to pay.”
“In business, Westerners tend to trust people until they prove themselves untrustworthy, but the opposite is true in China,” Brennan said. “It stems back to the deep tradition of guanxi, or relationships, where friends introduce you to people you can trust for tasks or transactions.” He thinks most domestic viewers of the China Mobile supercop ad would “see it putting forth strength to hunt down bad actors. Meanwhile in Western society, we’d say the state has too much control, and facial recognition is being used for negative purposes. It boils down to perceptions of trust.”
Chinese surveillance technology, especially social credit systems and facial recognition, is seen by Western media as a final end to privacy. But Tencent watcher Matthew Brennan sees this innovation works differently on the ground, in China, he explains in Metro.
Metro:
‘There’s been a lot written of very scary, negative coverage regarding social credit in China,’ says Matthew Brennan, a China-based technology expert.
‘The reality on the ground is very different to what is being reported.’
Brennan believes Chinese citizens do have privacy – ‘but it’s difficult to explain how much’.
He draws comparisons with credit score checking systems in the US and UK, which bring in oodles of data from different sources to assess how creditworthy an individual is.
‘These credit score systems in developed markets also monitor consumers,’ he says. He believes that China is simply embracing technology in new ways.
Large tech companies in China are rolling out new ways of utilising personal data to carry out everyday tasks – from checking in to flights to paying for items in shops...
The country was among the first to dally with foldable smartphones, and has recently seen smartphones with projectors built-in come to market. But in the near future it will see ticketing for its subway using facial recognition to make payments become more widespread.
Brennan has even demonstrated on his Twitter feed the ability to check in for flights and check out at supermarkets using facial recognition, tied to government ID cards.
‘It’s cropping up all over China in different scenarios, some of which are payment related, some of which aren’t,’ he says.
This may seem like anathema to a western audience, but in China it’s the norm. ‘It’s got a much broader acceptance amongst society,’ Brennan says.
Wow! China Airport face recognition systems to help you check your flight status and find the way to your gate. Note I did not input anything, it accurately identified my full flight information from my face! pic.twitter.com/5ASdrwA7wj
Fighting Alibaba on e-commerce is a tough struggle, but Tencent's WeChat is clearly delivering on improving its shopping environment, even when it does not beat Alibaba, says Tencent watcher Matthew Brennan to TechNode.
TechNode:
[T]he latest update seems to fit with Tencent’s aim to make mini-programs easy to use. It’s “very much in line with what they said they would do,” says Matthew Brennan, co-founder of China Channel.
“The whole mini-program initiative is about helping startups, helping more businesses,” Brennan told TechNode. That applies to e-commerce as well. Just a few years ago, WeChat “wasn’t a very natural environment” for online shoppers, said Brennan. Now the whole in-app retail experience has become much smoother thanks to pushes from Tencent.
Brennan doesn’t see the company’s e-commerce initiative as a direct competitor to Alibaba. Instead, like the “runaway hit” platform Pinduoduo, WeChat is finding new models “to let social e-commerce flourish.”
And fast-growing mini-programs, launched in January 2017, happen to be a convenient tool for alternative means for growth. As of the second quarter of 2018, Tencent reported that WeChat hosted over 1 million mini-programs on its platform, a 72% jump from the same period in 2017. Total users reached 600 million, with close to one half accessing them four to six times a day.
Growing used to be easy for Tencent and other Chinese IT giants, as mobiles proliferated and consumers got used to the internet. But, as the limited growth by Tencent showed last week, the company has to diversify its key games asset into other industries and global expansion, says Tencent watcher Matthew Brennanto the South China Morning Post.
The South China Morning Post:
Tencent’s roller-coaster year also took place as China’s technology giants came of age. Baidu, Alibaba Group Holding and Tencent – the trio of internet companies that has come to represent Chinese Big Tech – are all around 20 years old and have expanded their presence beyond China's shores.
“We’re coming to the tail end of a decade of gangbuster high growth due to the mobile revolution,” said Matthew Brennan, managing director of consultancy China Channel. “The incremental increases in number of users and time spent online per person is getting less and less. All the low-hanging fruit is long gone.”
He said the business-to-business market “is an area many technology companies, both in the US and China, feel holds more opportunities for growth”.
WeChat is one of the largest social platforms in the world, and an example of what Facebook CEO Mark Zuckerberg wants to do with his platform. WeChat expert Matthew Brennan is one of three avid WeChat users explaining to the Jing Daily what WeChat means for his daily life, including their mini-programs.
Jing Daily:
Matthew: WeChat is primarily a communication tool for me. Some days, I’ll communicate with anywhere between 10 to 100 people in a single day. It’s also time-consuming to manage a 440-person WeChat group...
I also use mini-programs on a daily basis — at least once a day. The most popular ones are Meituan Dianping (food delivery) and Luckin Coffee. I also use one for requesting and sending invoices...
If I am offline and am going to a convenience store or a market to buy some clothes [I’ll use it]. I use it to pay for pretty much any daily purchases you can think of. I rarely use Alipay. I opt for other types of payments only when paying a large sum, like my daughter’s kindergarten tuition. If you speak with people in Shanghai, they use a lot of Alipay. It’s popular in first-tier cities and among young people. WeChat is definitely more universal and lets older generations to purchase offline. Shenzhen and Guangzhou are much more skewed to WeChat because that’s where the company is based...
WeChat official accounts are an important part of the content ecosystem. On average, I will read at least two articles about tech on WeChat a day. I access them from in the subscription account folder, through content shared in Moments, and from “Top Stories”(ηδΈη). I also run my own official accounts and update them about once a month...
Commenting from a business strategy perspective: three contenders to WeChat were recently released on the same day including Duoshan from Bytedance, which has gained a lot of media attention. The most popular quote online from a social media user was this: “I had a good time chatting on three products, but we still want to keep in touch, so we added each other on WeChat.” I think it nicely sums up the situation regarding any alternative communication platform that would like to rival WeChat.
China's internet giant Tencent has become a winner, first by copying US competitors, but now it has become their inspirator, says Tencent-watcher Matthew Brennan to Leadersleague. “WeChat does not monetize data, but it is a growth lever for other businesses in the Tencent group. It’s a bit like iOS or Android in that regard,” says Brennan.
Leadersleague:
Tencent does not sell access to user-data to third parties, such as advertisers. The data of the Chinese app is to all intents and purposes the handsets of the users. “It would have been possible to compare We Chat to Facebook, Baidu to Google or Alibaba to Amazon ten years ago, but that’s no longer possible today,” insists Matthew Brennan a consultant specializing in Chinese IT...
The most widely used of WeChat’s secondary functions is WeChat Pay. Until recently, Chinese people’s attachment to paying with hard cash was the norm. Nowadays, e-commerce represents 14% of all retail sales, against 8% in France. With WeChat Pay, you can use your phone to settle a bar tab or pay an electricity bill. Even the famous hongbao red envelopes Chinese use to exchange monetary gifts are being replaced by the application. During the 2017 Chinese New Year period, 14 billion transactions were carried out using the app. “Tencent has taken advantage of the lack of a developed baking sector in China, where the use of credit cards is not commonplace,” adds Brennan. By cannibalizing all the different services available on smartphones, WeChat has become a killer app, which the competition find impossible to match.
Tencent is the big winner from the success of WeChat. Not only does the company take a percentage of every transaction made using the app, but it has developed its own content for the platform. “WeChat does not monetize data, but it is a growth lever for other businesses in the Tencent group. It’s a bit like iOS or Android in that regard,” stresses Brennan. Via WeChat Tencent can commercialize other businesses, such as Tencent Video or Tencent Music. In total the average mobile phone user spends 55% of their time on a Tencent service. The case of streaming services is particularly instructive. Thanks to WeChat, Tencent has managed to increase the subscriber base of its VOD platform Tencent Video, seizing a quarter of the Chinese market. The company claims to have more subscribers than Netflix even.
Between 2016 and 2017, Tencent made 318 investments in startups and diversified number of sectors it is involved in in order to propose more services on WeChat. Tencent has invested in Karius, a platform specializing in the diagnosis of infectious diseases, and branched out into the connected agriculture sector.
Tencent's WeChat released last week to manage its successful mini-programs, moving ahead with an operating system, pushing against the already embattled competitor Apple, says Tencent watcher Matthew Brennan in CNBC. The fight might focus on China, where mini-programs are most popular.
CNBC:
A recent update of the WeChat app from Chinese tech juggernaut Tencent could have "serious ramifications" for Apple, according to one analyst.
The WeChat update, which came out this week, involves a redesign in the way mini-programs — apps within the app — are presented. With that change, users now "essentially have a second home screen" on their phones, said Matthew Brennan, co-founder and managing director at consultancy China Channel.
While a change in user interface may not immediately seem like a game changer, experts said it signals a significant shift in the Chinese tech space...
Commenting on the potential financial impact of the design change in WeChat on Apple, Brennan...generally agreed that the impact would be more long-term in nature...
Brennan said the mini-programs on WeChat are "not designed to be very big" and are unlikely to compete against the games that feature on Apple's App Store.
Bytedance’s Tiktok, known in China as Douyin, has for the first time disclosed some of the figures on its usage. Tiktok is only starting to grow, says
