Becoming a Russian Oligarch After Rebirth
Chapter 941 - 871: The Beacon Fires Lit Everywhere

Chapter 941: Chapter 871: The Beacon Fires Lit Everywhere

Internet enterprises, user count, or rather traffic, is undoubtedly crucial—it’s virtually the lifeline of a company.

But after capturing traffic, how to monetize it becomes an even more crucial element!

If you can’t monetize your traffic, then it’s nothing but junk traffic, which means the company can only burn money to maintain this massive traffic volume, incurring huge monthly costs for servers and bandwidth as well as hefty personnel wages.

Yet without corresponding income...

High expenditures, low income—what future is there to talk about for such a company!

That’s why the once worldwide sensation ICQ sold itself to a traditional media giant for a relatively low price, because it couldn’t find a way to monetize its traffic.

And now, Tencent Company is facing a similar predicament.

The user count is plenty, and the traffic volume is large, but an effective method for monetizing that traffic hasn’t been found yet.

On the surface, it seems "prosperous," but in reality, it is fraught with crisis!

One term that aptly describes the current state of Tencent is "false prosperity."

Because the number of users is still growing relatively quickly, investors of Tencent still have patience, willing to give the company more time.

But as the growth rate of user numbers slows down, the importance of revenue will become more pronounced.

If at that point the company still can’t find a suitable way to monetize its traffic, the patience of investors will run out, and Tencent could turn from today’s "unicorn enterprise" into a garbage enterprise...

Tencent has now reached this critical stage.

With enough users, it’s time to start figuring out how to transform these user numbers into financial revenue!

For this reason, Little Brother Ma and the management team of Tencent have also thought of many methods.

For example, introducing paid registrations, QQ club, beautiful number business, advertising business, etc.

All of these have been launched within the past two years, but as you can imagine, the results have not been ideal, and some even brought Tencent great public opinion pressure and notoriety...

Take their advertising business, for instance, early QQ users might still remember.

There used to be a rectangular area above the QQ chat window that was used for displaying ads.

This was one of QQ’s earliest methods to try monetizing traffic, and also a method all companies in the internet industry would utilize at the time—internet advertisement!

Unfortunately, since QQ is an instant messaging software, and the chat window is inherently small, the area for displaying ads would naturally be just a tiny space.

In this aspect, it totally couldn’t match portal websites.

Portal website ads could even fill an entire user’s monitor screen, so the display effect was naturally much better than on QQ.

Therefore, besides competitors from the same industry, i.e., other internet companies willing to advertise on QQ to attract users, real traditional industry users had no interest in advertising on QQ.

Not just because the ad display area was too small, but also because at that time QQ users had "poor quality."

Back then, high-quality internet users were all on MSN, and the general QQ users were a young demographic, seen by advertisers as having poor consumption capacity...

As a result, QQ’s advertising business did not bring much income to the company.

As for paid registration, which meant paying to register a new QQ number, this issue caused a huge uproar at the time and nearly led to Tencent’s "stillbirth."

After a trial period, it was quietly taken offline.

Other services like the QQ club and beautiful number business could only be considered a drop in the bucket, not addressing the actual issue.

At that time, Tencent’s main income actually came from the mobile internet.

Yes, by 2004, the mobile internet had already flourished.

Through cooperation with Mobile Dream Net, significant revenue was brought to Tencent, making it the company’s most significant source of income!

In 2003, Tencent’s annual revenue was 730 million CNY, with 600 million coming from its share of Mobile Dream Net...

......

Actually, for Tencent in 2004, the inability to monetize traffic was not the most important problem.

There was a more severe issue, even threatening Tencent’s survival, lying right before Little Brother Ma and his team.

In the history of China’s internet, the topic of instant messaging software inevitably revolves around the year 2004.

Many people describe that year’s fierce battle among instant messaging software as "the battle of the gods"...

Perhaps it was Little Brother Ma’s aggressive tactics in the previous two years that showed competitors an opportunity.

Or maybe the original business of many internet factories had hit a bottleneck, hence they took interest in the instant messaging software segment, which, although not making money, could bring in massive traffic.

In short, during that year, Little Brother Ma and his team suddenly found themselves facing particularly strong new competitors.

And they were all very powerful big companies, each launching their instant messaging software to directly engage Tencent in close quarters combat.

NetEase had already launched NetEase Bubble in 2002, whose market share was third, after Tencent and MSN.

In 2004, CEO Ding announced an upgrade of NetEase Bubble to a strategic product, with the project manager reporting directly to him.

In June 2004, NetEase held a press conference, proclaiming that they had achieved a technological breakthrough—NetEase Bubble could now send voice messages directly. Not only could users of NetEase Bubble make voice calls among themselves, but they could even make voice calls with mobile phone users!