The new page asks players “How else can you play an FPS?” and then presents them with a eight this-or-that voting options, each relating to a particular element of gameplay design. The percent of votes each option has accrued is prominently displayed, and while the site doesn’t explicitly say so, it certainly implies that the higher-voted options will be implemented into the game.

If Netease really plans to abide by these votes — we’ve contacted the company for comment — then I believe this will be the world’s first FPS from a major development studio to crowd-source such huge aspects of its game design. It’s a bold move, and one that likely means we won’t be seeing this game anytime soon, as based on these questions it seems like the game must be in a very early phase of development.

So what choices are gamers being given, and what are they choosing so far? The page has only been up for a day, but it appears to have already attracted thousands of votes, resulting in these choices:

Aim-assist vs. pure skill: Here, 83.69 percent of respondents so far have voted for having some degree of aim-assist to make shooting more precise. This shouldn’t come as much of a surprise as many modern shooters including Call of Duty and Battlefield have aim-assist mechanisms so that aiming is not 100 percent manual.

Progressive characters vs. static characters: Here, players are pretty torn, with 45.67 percent voting for progressive characters that can be leveled-up, specialized, and personalized, and 54.32 percent voting for static characters whose only differences are their external appearances (which makes the game fairer in multiplayer matches).

Responsive maps vs. static maps: Players overwhelmingly (89.09 percent) prefer responsive maps that may change over the course of gameplay (for example, a hole gets blown in a wall or a building collapses).

Story-based single player vs. arcade-style single player: When asked whether they preferred a single player mode with characters and a story or an arcade-style single player mode that just focuses on fun carnage, voters so far definitely prefer the game to tell a story (87.71 percent).

Large-scale battles vs. small-scale battles: Do players want Battlefield style engagements, with huge maps, vehicles, and long range engagements, or Call of Duty style smaller maps that are more focused on speed and foot battles? Voters so far prefer the former (82.74 percent).

Varied actions vs. traditional actions: Players have thus far indicated that they’d prefer playable characters to have varied actions (running, crouching, walking, creeping, assassinations, etc.), rather than have a game with fewer actions that’s more focused on pure speed and skill (83.9 percent to 16.09 percent).

Character classes vs. All-around warriors: Voters are split on whether they want different character classes with different skill sets (for example, a medic whose stats are geared towards healing, a heavy whose stats are geared towards causing maximum damage, etc.) or characters who are equally capable of doing anything so long as they have the right equipment, with the former option thus far garnering 46.98 percent of the vote and the latter 53.01 percent of it.

Upgradeable guns vs. standard weapons: Having ‘standard’ guns that can’t be upgraded ensures fairness and emphasizes the differences between each weapon, but so far gamers still prefer weapons that can be modded and upgraded, with 83.73 percent of respondents voting for that option.

As you can see, some of these options certainly indicate that not much work has yet been done on the game beyond the apparent creation of a new game engine (for example, the fact that Netease is asking if gamers prefer a story mode or an arcade mode for single player would seem to indicate developers haven’t really started work on the single player sections of the game yet).

We’re not completely certain that Netease is totally committed to abiding by these votes, and we’re hoping to hear back from the company soon with more details about how the game will be designed. If major design decisions like this really are being crowd-sourced, that would seem to be an industry first, but I wonder whether it will make for a good game. There is always the risk that when you try to please everyone you end up pleasing no one, and the crowd-sourced approach to design could certainly lead to a Frankenstein-style final product with lots of interesting bits but no cohesive whole. Either way, it’s a fascinating idea and we’re going to pry as much detail as we can out of Netease about it, so stay tuned!

Everybody loves a good mystery. And it seems the folks at Netease have gotten people talking about one with this teaser page for a new first-person shooter. More about the game will be revealed next Tuesday, but there are some very interesting clues on the teaser page (pictured above).

First is the series of “passwords” used to “hack” into the computer. The three passwords that fail initially are CryEngine, Unreal, and Frostbite. As hardcore gamers know, these are the names of three of the biggest and most modern FPS game engines in the world, and have been used for many of recent globally high-profile FPS titles. But the computer on the teaser site rejects those “passwords” and instead chooses Dynamite. Since that’s not the name of an existing game engine, we can only assume that Netease has developed its own engine for use with this upcoming game.

While it could just be marketing hype, it was definitely bold for Netease to put this apparently engine in the same league as CryEngine, Unreal, and Frostbite. If it really is on that level — and that’s a big if — it could signify an attempt by Netease to move beyond China, or at least to license its new engine to the global game developers who are now using CryEngine or the Unreal engine for their games.

We can also make a few guesses about the game itself from the teaser page. Given that the gun and helicopter on the desk appear to be pretty modern, we can assume the game takes place in or around the present day, and that it probably also involves some vehicle combat. The bloody biohazard symbol is interesting, too — could the game’s plot concern chemical warfare of some kind?

There are also a few guesses we can make about the game based on Netease’s past record of game development. While it seems clear this game is a first-person shooter, Netease’s most successful games have been MMORPGs, and it seems likely that this game may include some MMORPG elements, although it’s hard to say exactly what. More interestingly, though, many of Netease’s biggest games include elements of Chinese history and mythology. Will this shooter also include some China-specific elements to make it more appealing to the hometown crowd?

Whatever it turns out to be, the game is facing what is likely to be stiff competition from the impending release of Call of Duty Online, Activision and Tencent’s interpretation of the global smash-hit shooter franchise as a freemium PC game for the Chinese market. The game is coming out soon, and while I’ve argued that hardcore Chinese gamers may be put off by it, it’s still likely to be very popular, and Netease’s game will need to be pretty impressive to turn heads away from the CoD spectacle.

Of course, in doing so, Netease is also helping itself. The company is the official operator for Blizzard games like Starcraft 2, which are hugely popular among competitive gamers. DOTA-like games are also hugely popular in the e-sports arena, and not coincidentally, Netease will be releasing its own DOTA clone called Heroes of the Three Kingdoms next week. Netease is likely hoping that with the help of government organizations like the General Administration of Sport of China, it can establish Heroes of the Three Kingdoms as the DOTA game of choice for domestic gaming competitions.

In fact, Tuesday’s press conference seems to have been used in part as a promotional event for Heroes of the Three Kingdoms, with time devoted set aside for the game developers to talk about the game and the development process. It sounds interesting, and I’ll hopefully be taking a closer look at it next week, but all the self-promotion makes it a little hard to take Netease’s rhetoric about helping domestic e-sports all that seriously.

The bigger question, though, is to what extent competitive gaming can really catch on in China. As of now, it certainly hasn’t managed to capture anything approaching a mainstream audience, but it also hasn’t been promoted that heavily outside of a few niches. Could e-sports ever rival the popularity of (forgive me) real sports like soccer or basketball in China? Personally, I’m pretty skeptical, but stranger things have happened. I suppose we’ll just have to wait and see.

(via Netease Games)

The new app, which will be called Yixin, will reportedly be based on China Telecom’s existing chat app Yiliao. The name “Yixin” is itself a little reminiscent of WeChat, borrowing as it does the “xin” from WeChat’s Chinese name Weixin. Sina Tech claims that according to industry insiders and insiders at China Telecom, the company will have a partner in developing and releasing this new app: Netease. Supposedly, China Telecom board chair Wang Xiaochu and Netease CEO Ding Lei have already met in secret to work out a partnership agreement that would see the two companies collaborating on Yixin in the hopes of dethroning Tencent’s mobile messaging giant.

Neither company has yet confirmed the partnership (and a China Telecom spokesman has already denied it), but a Sohu IT report picked up by Chinese state wire service Xinhua features an image of the rumored app in action (pictured above) and provides more detail on the nature of the partnership. According to the article, Netease will help China Telecom add features to and upgrade Yiliao while at the same time integrating its own user account authentication process with the app so that Netease users can log in easily. If the image above is real, it seems that much like other chat apps, Yixin will allow users to share recorded audio, photos, videos, locations, and emoticons with each other in the chat window.

If the rumors do prove true, Netease and China Telecom will certainly have their work cut out for them. WeChat already has more than 300 million users, and most of them are in China. Coming from so far behind, Telecom and Netease are going to have to offer users a very compelling reason to pick Yixin over WeChat, and based on the screenshots above, I just don’t see it. Don’t get me wrong; Yixin looks like a perfectly competent mobile messaging app, but WeChat has the brand, the user numbers, the momentum, and a few cool extras like its business card exchange feature. To enter the game at this stage, China Telecom and Netease would need something pretty revolutionary to take the wind out of WeChat’s sails. I don’t see anything like that in the screenshot above, and neither company has anything approaching the pedigree of Tencent when it comes to chat applications.

Of course, the partnership is still just a rumor, although there seems to be plenty of testimony and even a little photographic evidence that it is real. Since China Telecom has denied the rumor, it seems likely that any product launch is still quite a long time away, if it ever happens at all. A lot could change between whenever the screenshot above was taken and whenever Yixin actually sees the light of day. Perhaps China Telecom and Netease will be able to pull a rabbit out of their hat, but with WeChat at 300 million users and growing fast, it’s going to have to be a pretty damn big rabbit if they hope to stand a chance.

(via Sina Tech, and Sohu IT via Xinhua)

Shanda is one of the pioneers of China’s gaming and internet industries, and the split-off Shanda Games (NASDAQ:GAME) has long been a dominant figure in the games industry. But could those days be coming to an end? In Shanda Games’s Q4 2012 earnings report, the company reveals that net revenue dipped more than 20 percent year-on-year (to $172 million), and gross profit was down more than 15 percent year-on-year (to $115.9 million).

Those are still absurdly high numbers, of course, but for the first time in a long time they weren’t absurdly high enough to beat out rivals Changyou (NASDAQ:CYOU), who just barely eked out Shanda Games with $173 million in Q4 net revenue. Of course, both companies were still dwarfed by Netease, which dominated the online game industry with more than $300 million in net revenue.

So how does Shanda plan to respond? In the company’s quarterly earnings call, CEO Zhang Xiangdong revealed that Shanda is working on a 3D game engine, and it hopes to use that engine to develop 3D games based on its most popular 2D games. It’s an ambitious (if also long overdue) plan, as the shift to 3D development often raises the stakes — making a 3D game costs more, so flops and missteps are more painful.

But in addition to the decent-but-not-great financial numbers listed above, Shanda also reported a bit of a mixed bag with regards to the changes its player base underwent in Q4. In the Q4 report, the company said that average monthly paying users had dropped quite a bit (4.9 percent quarter-on-quarter) due to the introduction of more free-to-play games, but average monthly active users and average monthly revenue per paying user were both up (1.2 percent and 1.1 percent, respectively). Will 3D games bring in more gamers or generate more revenue for Shanda? We’ll have to wait and see.

(via Sina Tech and Shanda Games’s Q4 2012 report)

China’s tightened internet controls were passed into law earlier today. As well as requiring broadband and mobile internet providers to have full ‘real name’ details of their customers (which pretty much happens already), the new 12-article law also mandates how all web companies operating in China must control what people post. That effectively legalizes the deletion of posts that contain what authorities deem to be “illegal” content or information.

Again, that’s close to what happens already in practice with the blanket self-censorship and fast-paced moderation that goes on on the Chinese web, as seen very clearly on the Twitter-like Sina Weibo. And so the new law will criminalize companies who do not censor the web with the kind of speed and efficiency that the law now dictates. That has huge implications for social companies like Sina (NASDAQ:SINA), Tencent (HKG:0700), and Renren (NYSE:RENN), and search engines from Baidu (NASDAQ:BIDU), Sohu (NASDAQ:SOHU), and Qihoo (NYSE:QIHU). In fact, it’s an extra strain on the whole internet sector in the country, with possible extra costs involved in the already weighty and arduous practice of removing dissent, as well as other genuinely illegal acts on the web.

It’s surely only a matter of time before one Chinese web company is held criminally responsible for content posted on its service. And what will happen then? A fine? The jailing of the relevant member of staff?

Using Xinhua’s presumably official version of events, the news agency summarizes this aspect of the new law:

Service providers are required to instantly stop the transmission of illegal information once it is spotted and take relevant measures, including removing the information and saving records, before reporting to supervisory authorities, the decision says.

It empowers supervising departments to take technical and other necessary measures to prevent, stop or punish those who infringe on online privacy, requiring relevant service providers to give support during investigations.

There are some positive aspects to all this, as it also puts into law measures that, Xinhua says, “will protect digital information that could be used to determine the identity of a user or that concerns a user’s privacy.”

But as with all new web controls in China, a country where the web is already massively locked down, many will worry that the tightened legal framework will be used to identify people who post online some ‘sensitive’ information, such as – to take a topical example – evidence of corruption among officials.

In practice, a lot of this is happening already, as with recent real name requirements for microblogs like Sina Weibo, or the long-standing need to show ID when buying a mobile SIM. For now, a lot of questions remain unanswered, such as how this affects wifi hotspots, or people who rent homes and whose broadband account will be in the name of the home-owner – and a lot of other issues and unknowns.

Chinese web portal Netease (NASDAQ:NTES) is making good progress with its Evernote-like cloud notes service, Youdao YunBiJi, which has just surpassed eight million users. According to the Youdao staffer in charge of this product, it has 450,000 active daily users.

Back in February of this year it was at two million registered users, then by July it was up at three million – but Youdao YunBiJi has made a big leap up since the summer. It has apps for Windows PC, iPhone, iPad, and Android, and can be found at note.youdao.com.

The Youdao YunBiJi mobile apps recently got bumped up to v3.0, bringing a UI refresh and some new features like to-do lists. But its UI is still staid and unimaginative (pictured above), lacking the visual flair of Evernote.

But it’s thought that local web rival Shanda (NASDAQ:SNDA) has the largest cloud notes service in the country, with its early-starter Mknote which has been running for two years already. Silicon Valley’s Evernote launched a localized version for China in May of this year, and quickly rocketed to 1.1 million users in the space of just two months.

Netease is best known for its social gaming and email services, and also has a search engine (China’s seventh-largest) under the same Youdao brand.

[Source: Marbridge Daily]

Sad Panda: Even Mists of Pandaria hasn’t helped bolster flagging interest in World of Warcraft.

Oh, how times have changed! Just a few years ago, World of Warcraft was the world’s premier MMORPG, and Chinese game publishers fought tooth and nail over who would get the rights to operate the game in China. And while the game is still extremely popular these days, Netease’s latest quarterly financials reveal a company whose internally-developed games are taking off, but whose financial development is being held back by sliding revenue from World of Warcraft as subscriber numbers decrease.

This is especially interesting given that Blizzard just launched the new China-themed expansion Mists of Pandaria. Netease’s quarterly press release says the company believes this expansion is “being widely embraced” by the Chinese gaming community, but it also admits that decreased revenue from WoW is one of the main reasons for the company’s lower-than-expected growth this quarter. Netease-developed games that are raking in the dough include Fantasy Westward Journey, Westward Journey Online II, Kung Fu Master, and Soul of the Fighter.

Of course, World of Warcraft subscriptions were bound to start dropping sometime; after all, the game is nearly a decade old. In modern gaming terms, that is absolutely ancient. Blizzard is working on a new MMORPG codenamed “project Titan” that Netease is likely to get the China rights to, but given that almost nothing is known about that game and that Blizzard is famous for extensive delays, it’s not likely to be seen in China anytime soon. (Plus, games are often delayed even further in China — the country still doesn’t even have Diablo 3 yet!)

[QQ Tech via TechWeb]

Clearly, Netease is in the mood for love. Just days after the company launched a new iPhone LBS dating app, it has come out that Netease will also be launching dating website. The site, called Hua Tian, is coming just as a closed beta for the moment, so you can’t jump in just yet. But Netease is promising that it’s coming soon, along with Android and iOS apps to support it.

The site will require real-name registration to ensure that people aren’t getting misled or manipulated, and at present it is actually targeting companies, asking them to sign up single employees to increase their overall degree of employee happiness. At the moment, it’s all totally free, and while the company may start charging at a later date, it seems unlikely given that the service has adopted the motto “communication is important, fees are dishonest.” It’s not entirely clear yet whether the service will be permanently targeted at corporations, but if it is, it’s possible that Netease could charge the companies a fee for the memberships of their employees so that the employees — the actual end-users — never end up paying a dime. If the site really does increase their happiness and help them find love, that sounds like a win-win.

Of course, with Hua Tian in closed beta, it’s really not clear what, if anything, the company offers that differs from more established dating sites like Jiayuan. The focus on getting at single employees via their companies could be unique, but it remains to be seen whether that’s actually Netease’s long-term strategy or just a technique they’re using to find users during the closed-beta phase.

[36kr via Tech in Asia Chinese]

Chinese web companies have a bad reputation for back-stabbing and skullduggery – but that might be about to change, at least for China’s search engines. The country’s top 12 search engines [1] yesterday signed a code of conduct that aims to stamp out acts of sabotage and unfair competition.

The agreement brought together representatives from 12 web companies in the search engine sector at the behest of a government-backed trade organization. Aside from creating the awkward photo below, it also brought together fierce rivals Baidu (NASDAQ:BIDU) and Qihoo (NYSE:QIHU), which have been locked in a tense stand-off after Qihoo launched its own search engine this summer. Indeed, the subsequent Baidu-Qihoo tussle shone a spotlight on some of the shadier shenanigans on the Chinese web, with suspicions of content-scraping and blocking rivals.

Click to enlarge.

The code of conduct focuses on the web spiders that crawl websites to index content. These things should no longer be used “to carry out acts of unfair competition,” says the WSJ translation of the agreement. And although the code is voluntary and not legally binding, the government involvement might make the companies – such as Baidu, Qihoo, Tencent, and Sohu – wary of upsetting authorities.

Web spider usage was a cause of concern just after Qihoo’s 360 Search was launched, with some accusing Qihoo of scraping Baidu’s search results to give its fledgling product a boost. But yesterday, Qihoo’s CFO, Alex Xu, denied the allegation and said his company only indexed Baidu content like its Wikipedia-esque ZhiDao BaiKe service, and did not in any way steal Baidu’s search results.

As with all government-backed pronouncements like this, we say, Good luck with that!

[Source: WSJ (paywalled); photo: QQ Tech]

The green-eyed monster of jealousy is never an attractive thing – especially in relationships. But that’s what seems to have motivated China’s Netease (NASDAQ:NTES), which is better known for its online gaming services, to launch a new location-based dating app.

Bearing the not very catchy name TongCheng YueHui (literally meaning ‘dating in the same city’), it looks to be Netease’s response to the success of the flirty Momo app, made by a tiny Beijing startup, which has rocketed to 16 million users and is even rolling out internationally. Some might even say that Netease is trying to clone the app – a common tactic among China’s major web companies.

TongCheng YueHui – as with Momo – is centered around an app (pictured above) that finds nearby users of the opposite gender and lets you chat with them directly and simply. So far, there’s just an iPhone app, with no signs of an Android version. But the new service is not strictly mobile only. Perhaps because Netease is an old-skool web portal company and it cannot resist page-views, there’s also a full dating site at Yuehui.163.com. That means bad news for China’s other major dating websites, like Baihe, and Jiayuan (NASDAQ:DATE) with its 5.5 million users. Like the old-style match-making sites, Netease’s TongCheng YueHui also has a virtual currency, and you’ll need to buy some to get more things done.

So, in summary, the new service is either a very clever or highly awkward mix of a traditional dating site and a new mobile LBS app. We’ll have to wait and see how receptive users are – and which rival site will see the most damage from a major web portal entering this sector.

In other Netease news recently, the company revealed that it has 260 million registered users on its Twitter-like Netease Weibo site.

Check out the TongCheng YueHui iPhone app on its new homepage.

“Weibo” is the generic term for microblogging in Chinese – and when somebody utters the word, it’s usually in relation to the hottest of China’s Twitter clones, Sina Weibo. On occasions, it’s referring to Tencent Weibo. But rarely is the individual actually talking about Netease Weibo. Nonetheless, the Netease (NASDAQ:NTES) social service has exceeded 260 million registered users, according to numbers issued by the company.

Netease Weibo remains the third-largest of the numerous microblogging services in China. The biggest in terms of registered user numbers is actually Tencent Weibo, with an eye-watering 469 million at 2012 Q2. Sina Weibo is the one that has all the buzz – and much of the social marketing focus of brands – and it had 368 million at the halfway point of this year, with 36.5 million average daily active users. Netease Weibo did not reveal how many of its users are active on a daily or monthly basis.

Netease, perhaps best known in China for its gaming platform, reckons that the boost in numbers is due to its Weibo service adding new content channels and a refreshed UI. But the growing numbers equally could just come from people with a Netease account trying it out and then rarely using it.

Launched in March 2010, Netease Weibo is also up against similar social sites from other major web portal companies in China, such as Sohu Weibo. Indeed, in China’s ever competitive tech scene, there are even some state-run microblogging sites, such as People’s Weibo, which is run by People’s Daily Online (SHA:603000). Despite Netease Weibo catching up with Sina Weibo in terms of user numbers, there’s little danger of Sina losing its crown of being “China’s Twitter” anytime soon.

[Sources: Netease Tech, via Techweb - articles in Chinese]

We’ve seen Chinese internet companies expand in all kinds of weird directions recently (see: 360Buy), but this one is definitely the weirdest. Netease, a senior marketing manager has confirmed, is going into pork production.

When an image of “Netease pork” began spreading on Weibo, the Southern Daily got in touch with Lin Huasong, a senior marketing manager at Netease, who (incredibly) confirmed that it’s true. Netease really is working on pork. However, he said, the pork pictured isn’t exactly the real thing.

The pork pictured on Weibo is Netease’s, but the true Netease pork will have some differences [...] Netease’s pig farm is still under construction, but we have already begun the raising of pigs in other locations that will eventually be moved onto the Netease pig farm.

But if you’re rushing out to pick up some Netease pork for dinner tonight, put the brakes on, because Lin says the real thing won’t be available for “at least a year” when Netease has the second generation of pigs being raised on its own farm. As for the weibo photo, it comes from an internal beta test of sorts conducted by the Netease food committee, which had previously been responsible for the food in Netease’s cafeterias.

Lin assured reporters that the response to this first round of testing was good, and that the feedback the first Netease pork received was quite positive. So when this whole internet fad thing finally burns out, it looks like Netease is going to have a solid fallback plan. The portal site may fall out of favor someday in China, but pork is never going out of style.

[Southern Daily via Sina Tech]

I wish all tech companies had animals for logos - like Tencent's QQ penguin - as it makes it easier to do silly photoshops like this one.

A Chinese research institute, in cooperation with authorities in Beijing, has compiled a list of China’s top 100 tech and web companies by revenue. Looking only at the top 10, it’s full of familiar names from the world of social media, e-commerce, and gaming.

Before seeing the top 10 list, the institute’s white paper points out this eye-watering figure: China’s hundred hottest tech companies pulled in a total profit of 11.6 billion RMB – that’s US$1.868 billion – in 2011. That’s 26 percent higher than the industry average in the country.

1. Tencent (HKG:0700) makes China’s biggest social network and is also top in social gaming. Plus, it makes WeChat, the world’s biggest messaging app. Oh, and it does e-commerce. And lots more.
2. Netease (NASDAQ:NTES) must’ve had a good year to make it so high up the list – but then this list is about revenues, not a company’s market cap. Netease is primarily a web portal, but it also does online gaming (it runs World of Warcraft in the country), and also the Evernote-esque, Youdao Yunbiji service.
3. Baidu (NASDAQ:BIDU) is the nation’s top search engine by a big margin, and also has a major ad platform and some social services too.
4. Sohu (NASDAQ:SOHU) is another web portal, and is pushing its streaming video site pretty hard these days. It also runs the Sogou search engine which is sneaking up on Google’s market share.
5. Shanda (NASDAQ:SNDA; FRA:RZP) here means Shanda Interactive, which makes the Kindle-like Bambook e-reader, and has lots of web services like an e-bookstore, cloud storage, and more. Its gaming subsidiary is separate.
6. Alibaba is China’s biggest e-commerce company in every sector, running Tmall, Taobao, and Alibaba.com.
7. Perfect World (NASDAQ:PWRD) is China’s fourth-biggest social gaming platform.
8. Giant Interactive (NYSE:GA) is a tad smaller than perfect World in terms of gaming revenue, coming in sixth in that respect in the country. It runs games like Allods Online in the country.
9. Besttone (SHA:600640) is a telecoms firm, and the only one in the top 10 that we’ve never looked at before.
10. Sina (NASDAQ:SINA) is talked about a lot these days – and on this site – as it runs Sina Weibo, China’s hippest Twitter-like service. But Weibo is proving costly to run and hard to monetize – hence having China’s hottest social media site doesn’t equate to stellar revenue.

There are plenty more big names lower down on the list, such as Qihoo 360 (NYSE:QIHU) in eleventh, media outlet People’s Daily Online (SHA:603000) in 24th, and the kids social network Taomee (NYSE:TAOM) in 41st.

Of course, the list is open to debate because revenue is not always the best way to rate a company. Perhaps a more representative list could be formed by calculating every firm’s true valuation. If we did that, then Tencent would still be first, but Alibaba Group would be second as the recent Yahoo share buyback and fundraising effectively valued Alibaba at $40 billion.

[Source: Techweb; via Techinasia Chinese]

The newest World of Warcraft (WoW) pack, Mists of Pandaria, has launched today in mainland China, just a week after its international rollout began. Despite the slight delay for local gamers, it arrives at a good time, towards the start of the “golden week” public holiday.

The developers, Blizzard (NASDAQ: ATVI) – and its Chinese partner, Netease (NASDAQ:NTES) – will be hoping that the China-themed new WoW land will be a boost to the aging MMORPG, and that the pandamonium-filled game will be a particular hit with gamers in mainland China, Hong Kong, and Taiwan. 25% of Activision Blizzard’s revenue comes from WoW, so it’s a cash cow that the company cannot allow to go lame.

The expansion pack – available as a box set or a digital download – brings a whole new race of people to the game, the “pandaren” anthropomorphic giant pandas. Which explains the official Chinese name, World of Warcraft: Panda Man of Mystery. There’s also a new monk class, with plenty of mystical powers, and a lot of temples, monasteries, and forests as new backdrops.

Judging by the fairly constant chatter about Mists of Pandaria on Sina Weibo all morning, the launch has not gone unnoticed, with lots of gamers showing off screenshots as well as their own pandaren. In a neat bit of social marketing, the auto-maker Mini even got into the spirit, and tweeted out the image below of a custom, steampunk-style panda-man Mini:

Above: A custom car tweeted out on Sina Weibo by Mini; Below: A panda jam screenshot from another Weibo user.

Chinese gamers will only have to wait one week longer than the rest of the world for the launch of the World of Warcraft expansion Mists of Pandaria. That’s because Blizzard and China’s Netease (NASDAQ:NTES) jointly announced today the arrival of the pandamonium-filled game on October 2nd. The global roll-out is on September 25th.

After getting the nod from regulators at the Ministry of Culture at the start of this month, it was hoped for a simul-launch, but at least one extra week is not too long to wait for its many fans in China. Its speedy release might be down to it being less controversial than a lot of other MMORPG titles.

The official name for Mists of Pandaria in Chinese will actually be: World of Warcraft: Panda Man of Mystery. Yes, “panda man”.

Netease has the license to operate the game in China, and the expansion pack will be available at the official Netease-Blizzard online store at bmall.163.com. As seen in the image above, it’s priced at 486 RMB (US$77). It’s already hitting some other e-commerce sites in the country, such as Amazon China and 360Buy, though shipping won’t really begin until September 28 in China, allowing Blizzard to first deal with the likely huge demand from the Korea and Taiwan launches on September 27th at midnight local time.

In an announcement from Blizzard about the mainland China launch, CEO and co-founder Mike Morhaime said:

We’re excited to bring Mists of Pandaria to China on October 2, making this expansion a truly global launch. Mists of Pandaria contains the biggest variety of new content we’ve ever created for a World of Warcraft expansion, with features that will appeal to new players, veterans, and everyone in between. We hope players enjoy exploring everything Pandaria has to offer.

[Source: Netease Tech - article in Chinese]

I began by search for some Converse-knockoff shoes, and I have to admit I was very underwhelmed. Huihui is clearly quite heavy on 360Buy listings, because for each of the four shoe models I looked at, 360Buy was the only vendor listed. That makes the whole price comparison thing sort of pointless, and I have definitely had better luck with shoes on eTao in the past.

But when I switched to searching for computers, things picked right up. As you can see from the image above, search results come with a lot of filtration options, and products have a convenient mouseover popup that reveals a price comparison between different indexed e-commerce sites. But, as you can also see from the image above, the listed price on Huihui is not always the lowest price found by the search engine. For example, that Dell in the lower left corner is listed at 4199 RMB even though there’s one option in the price comparison that puts it at 3999 RMB. This seems to be true across the board, and it makes shopping on Huihui a chore because you have to mouseover every single product to be sure the listed price is actually the lowest one they offer. This won’t matter for people who already know exactly what model they want, but for anyone interested in browsing, it’s going to be pretty annoying.

Huihui’s bigger problem will likely be competition, though, both from the aforementioned eTao and from smaller competitors like Sina’s Yiqisoo. Right now, I don’t think Huihui has what it takes to stand out, and it doesn’t seem to offer shoppers much reason to switch from whatever price comparison service they were using before. Still, it’s a slick-enough product and Netease fans may find it quite useful so long as they know exactly what product they are looking for before they start their search.

A Blizzard product launching worldwide and in China at the same time would be almost unprecedented (case in point: Diablo 3 still hasn’t been released in China yet). But Mists of Pandaria may have been able to pass through the Ministry of Culture more quickly than other Blizzard titles because its art design and characters are less objectionable. Most of Blizzard’s previous offerings were a bit more gruesome and morbid than the brightly-colored Pandaria, which probably made it much more palatable to the MOC.

Blizzard hopes the China-inspired Mists of Pandaria will help counteract flagging interest in its hugely popular but ancient-by-gaming-standards MMORPG. Netease, the operator of World of Warcraft in China, has seen decreases in World of Warcraft playing time and revenue over the first half of this year, and so is also hoping the expansion will bring Chinese gamers back into the fold.

[via Sina Tech]

Last December we reported that the Chinese web portal Netease is preparing a product search engine – a hot new area of competition on the web in China. And now, Marbridge reports, it appears to be close to launch as the Netease contender has a name and URL: Huihui.cn. Though not yet online, the e-commerce focused search engine is set to launch somewhere in the second half of the year.

Netease (NASDAQ:NTES) already has its own general search engine, at Youdao.com, and it’s thought that the Huihui product search and price comparison service will also display the “Youdao” branding once it goes live. Youdao already has a shopping section, but apparently that’s not specialist enough. It’s possible that the new site will focus more on price comparisons rather than just the current mish-mash of aggregated items.

It’ll be up against rivals such as eTao – made by China’s Alibaba Group, which runs several online malls – which has been a contentious subject of late, with some online retailers deciding to block eTao rather than play along with the e-commerce giant.

Netease will be hoping that it can use its claim of total independence as a way to bolster its new product search offering. But one other local web portal, Sina (NASDAQ:SINA), already has its own service, Yiqisoo, in action.

Netease’s Huihui search will aggregate product listings from numerous e-commerce sites in China.

[Source: Marbridge Daily]

Netease CEO Ding Lei

Back in May, Netease was one of the many companies planning on releasing a branded low-cost smartphone to compete with the likes of Xiaomi in China. Earlier this month, rumors began swirling that the phone project had been canceled, but now the company’s CEO Ding Lei has attached some weight to those rumors by refusing to comment on the project’s progress at a meeting with reporters in Hangzhou.

Mr. Ding has previously been very vocal about the smartphone project, and while his avoidance of the subject at this outing cannot be considered confirmation that the phone has been cancelled, it certainly doesn’t look good, coming as it does on the wings of anonymous internal sources claiming the project has been scrapped.

Netease representatives declined to comment for this story.

In mid-June, Ding announced that official images of the phone would be coming soon, and the Beijing News reported on the device’s specs: a 4.3-inch screen, dual-core CPU, Android 4.0 OS, and of course the device’s sub-1000 RMB ($158) price tag. Given those specifics, it seems the project was quite far along. It’s not clear what might have caused the device to be scrapped, but a rumored partnership with OPPO apparently fell through, and anonymous sources told Sina Tech that even the smartphone project’s manager was ambivalent about the project and advised Ding Lei to cancel it.

It’s also quite possible that Netease canned the project for financial reasons, as producing a competitive smartphone for less than 1000 RMB is quite difficult, especially for a company whose area of expertise is on the web, not in sourcing cheap hardware parts.

[Sina Tech]

This is what part of Netease's portal looks like; hope you enjoy links...

This apparent exodus echoes an incident from less than two years ago when seven high-level editors from Netease’s portal left the company en masse to found a startup. This rate of management-level employees departing is not normal. So what’s going on at Netease?

Employees say that the problem has to do with Netease’s incentive program, or rather, its lack of one. While employees outside the portal section of the company seem to get a better deal, portal management has apparently gotten nothing in the way of options or bonuses since 2004. The apparent compensation for this is that they are given greater autonomy, but unsurprisingly, that hasn’t proved to be a strong motivator. There are plenty of other portal sites out there, after all, and I bet some of them offer management some stock options.

Netease’s rumored plan to spin-off its portal business with a separate listing still hasn’t come to fruition. An insider told the First Finance Daily that it was still in progress, but its unclear whether or not it will placate portal employees, especially those at the management level.

[First Finance Daily via Sina Tech]

Yes, it's a crowded market: all four main cloud notes rivals in China squished together.

New user number stats for the main cloud notes services in China reveal that Evernote has made a great impact in the mere two months since it launched a separate version for the country. With a reported 1.1 million users, Evernote’s Chinese cousin – called Yinxiang Biji – has shot into third place among four main contenders.

But that still leaves Evernote trailing behind two major Chinese web companies and their more established notes syncing offerings. The oldest of the bunch has the greater number of users: that’s Shanda’s (NASDAQ:SNDA; FRA:RZP) Mknote with five million users (see the table below).

In second place is Netease’s (NASDAQ:NTES) Youdao YunBiji, which has grown to three million keen note-takers from the two million figure we reported back in February [1]. That leaves one startup, FIT, trailing in fourth place with its stylish YunBiji (yes, it has the same quite generic name as the Netease product, meaning “cloud notebook”) picking up 400,000 users so far. The stats were compiled by Techweb.com.cn, and come from self-reported figures:

Evernote’s main battle is clearly against Netease and Shanda. For free users, Evernote’s meagre 60MB of storage allowance per month seems to be sufficient and is not hampering the early traction of its Yinxiang Biji in the country. Since these services are mainly about taking notes, not storing files, the generous 1GB storage of the major web companies might not be a factor. I’d hazard a guess and say that the slickness of the Windows app – and then the accompanying mobile apps – will prove to be the winning factor.

Check out all four competitors on their homepages: Evernote’s Yinxiang Biji, Netease’s Youdao Yunbiji, Shanda’s Mknote, and FIT’s Yunbiji.

[Stats from: Techweb - article in Chinese]

Tencent's iconic penguin mascot surfs its way to social gaming success.

A seasonal survey of China’s online gaming market by Analysys International reveals some stellar growth up to the end of 2012 Q1 – and that Tencent (HKG:0700) has extended its lead as the country’s mavens of social gaming. Back in 2011 Q2, the Shenzhen-based web giant dominated with 29.5 percent of market share by revenue, but that’s now up to 33.7 percent.

The whole gaming sector has grown to be worth US$1.78 billion in terms of revenue in China. That’s 9.5 percent growth from the previous quarter.

There was a bit of a shuffle below Tencent, as Netease (NASDAQ:NTES) moved up from third to second spot, now claiming 17.3 percent of domestic online gaming revenue. Shanda Games (NASDAQ:GAME) saw no growth – despite its new World Zero title – and consequently got demoted to third.

Tencent runs China’s biggest social network with its QQ empire of IM, social networks, and social gaming. Earlier this week, we looked at the QQ Games exclusive tie-up with PopCap to launch Plants vs Zombies Great Wall Edition. It also operates some more hardcore MMO titles such as Crossfire. Indeed, social gaming is a large part of the reason behind the company having far-and-away China’s richest web portal.

Here’s the interactive chart for market share by revenue among China’s gaming services (2012 Q1):

(View the pie chart as a static image).

The online gaming market as a whole saw 33 percent year-on-year growth. When we last looked, last summer, it was at 8.7 billion RMB ($1.36 billion at that time), but the new figures show the industry has expanded to the point where it reels in 11.26 billion RMB ($1.78 billion) up to the end of 2012 Q1:

[Sources: Analysys International 1 and 2]

There are lots of ways to look at this data, and it’s no surprise to see Tencent way ahead of the rest of the pack. But the first thing that jumped out to me was the stark difference between what Tencent is making from its social networks and what Sina is making — or more accurately, what it isn’t making — from Weibo. Granted, Tencent versus Sina isn’t an entirely fair comparison when it comes to SNS, since Tencent has QQ, Weixin and Qzone in addition to its weibo service. But it’s certainly clear that Sina is having a very hard time monetizing its popular social network.

(Incidentally, it’s also worth noting Sina doesn’t seem to be making much of anything from its weibo gaming platform either. That’s not a huge surprise, as I’ve reviewed a number of the games and found them to be pretty bad, generally speaking, and way too blatant about begging for money.)

[via TechWeb]

The IGN Pro League (IPL), which is one major international professional gaming league, announced yesterday partnerships with China’s Netease and MarsTV. Both companies will cover future IPL events for a Chinese audience, broadcasting events and also sending reporters to international competitions. The IPL will also be bringing a few Chinese gamers along for the ride at some of its events in other countries throughout this year.

The IPL appears to be focused on two games — Starcraft and League of Legends — both of which are quite popular in China, and Chinese teams are likely to make their presence felt in international competition. As IPL founder David Ting put it: “We look forward to seeing Chinese StarCraft II players and League of Legends teams demonstrate their supreme dominance at IPL 5.”

Sure, these partnerships aren’t exactly the same as getting professional gaming on CCTV Sports; this is still very much a niche thing in China. But increased coverage on Chinese sites can only help expand pro gaming’s popularity, and perhaps someday China will be as game-crazy as its neighbors in Korea.

[PR Newswire via Marketwatch]

Let us make smartphones!

Perhaps inspired by Xiaomi, it seems everyone is looking to make a low-cost Android-based smartphone for the China market these days. Netease is apparently the latest company to throw its hat into the 1000 RMB ($158) phone ring, as high-level insiders told the Beijing News that the company has already produced a prototype.

The phone will reportedly be dual-core, feature a 4.3 inch screen, and run a skin of Android 4.0. Netease Founder Ding Lei has said the phone will come in at 1000 RMB or lower, making it cheaper than most of the phones on the market now. However, it’s not clear exactly when this phone will actually hit the market, and it’s likely to have a lot more competition in that price range if it isn’t released quite soon.

That’s because Baidu, Qihoo 360, and Shanda — among other companies — all have their eyes on the 1000 RMB smartphone market as well. Having more cheap smartphone options is never a bad thing for consumers, but these internet companies might do well to heed the warnings of Kaifu Lee about how internet companies tend to fail in mobile.

[Beijing News via Sina Tech]

The Americas region will include the US, Canada, Latin America, Australia, New Zealand, and Southeast Asia. The Europe region will include the European Union, Eastern Europe, Russia, Africa, and Middle Eastern countries such as Israel and the United Arab Emirates. The Asia region will include South Korea and the regions of Taiwan, Hong Kong, and Macau.

Notice that mainland China is nowhere to be found on that list. That’s probably because the game still doesn’t have an official China release date, but the announcement of this news begs the question: when the game is released here, will Chinese gamers be allowed to mingle with the rest of Asia in the global play multiplayer? Or will they be sequestered on their own servers, as in past Blizzard games?

My instinct is that they will likely be sequestered, for a number of reasons. The first is that China’s regulatory environment is extremely complex, and it may be difficult to even obtain the proper licenses. Of course, there’s also the question of censorship; China’s government isn’t a big fan of gore and horror, and past China operators of Blizzard games have chosen to remove certain elements — like skeletons — from games to facilitate the games passing muster here. Diablo 3 is full of supernatural horror elements, and it’s likely that Netease will have to make some changes to the game before it can be released here. Those changes might make it difficult or impossible to integrate players in China and in other countries, where the game will be released uncensored.

Perhaps more significant, though, is the potential of Diablo 3 as a communication tool. If Chinese gamers were allowed to play freely with gamers across Asia, they likely spend time conversing with players in Hong Kong and Taiwan, who speak Chinese and have access to news and information that is censored domestically. It’s hard to imagine much trouble could really come from this — Diablo 3 is not going to give rise to a Nerd Spring in China — but that doesn’t mean that Netease and the Chinese government won’t feel uncomfortable with the idea of Chinese gamers chatting freely with people from countries where news is less tightly controlled.

In any event, we’ll have to wait and see. It’s still not clear when Chinese gamers can even get their hands on the game itself; what their multiplayer experience will look like when they do is probably still up in the air.

We’e been following Netease’s Dragon Blade for a little while now, mostly because we still haven’t been able to get a handle on exactly what it is. Well, that’s not entirely true; it’s a 3D PC game that Netease has been touting for its use of high-end graphics that, while unremarkable by Western standards, do outstrip many popular Chinese games. But what kind of game is it? That has been hard to pin down! Our most recent guess is that it’s an MMORPG action game, whatever that means.

We should learn more soon enough, as Sina Tech is reporting today that the game will enter closed beta sometime in the second half of this year. Thats a pretty vague schedule, suggesting that the game is still a fair distance away from being ready for beta, but we can always hope that means July rather than December. Signups are already underway on the game’s official site, and I’ve dropped my own name into the ring as well — perhaps I’ll get a chance to see this game first hand.

Whatever else one can say about the game, Netease (NASDAQ:NTES) seems to be doing an impressive job of marketing it. Note to future game developers: if you want to build hype, confusing the heck out of people is apparently a good way to do it! (Of course, it helps if you’ve got good looking screenshots, too.)

[Via Sina Tech]

A couple weeks ago we told you about “Game-X”, a mystery project from Netease (NASDAQ:NTES) that promised to make dreams come true and defied attempts to figure out what the heck it actually was. Now, we sort of know. The game is called Dragon Blade, and the Game-X official site has been replaced with this site featuring a trailer and a whole bunch of other videos showing off the technology behind the game.

As for what the game actually is, it looks to be an MMO that plays a bit like a collaborative God of War. The trailer shows what appears to be single players attacking computer-controlled monsters in gameplay reminiscent of God of War or Devil May Cry, but other videos on the site — regrettably, not embeddable or even directly linkable — show multiple player-controlled characters working together to solve platforming puzzles.

The whole thing appears to be set in a fantasy world, which raises new questions about why the Game-X teaser site included graphics of a modern jumbo jet. But I have a feeling Netease is still keeping some secrets about the game. Several sections of the official site are still under construction, and there’s a very brief moment when guns appear in the otherwise-fantasy-based trailer (see the screenshot above). The character seems to be hopping around Dante-style, and the presence of guns alone certainly doesn’t do much to explain what any of this has to do with that plane from the Game-X site. Perhaps it was just a red herring. But we’ll definitely be keeping an eye on Dragon Blade to see if these monsters end up on any planes.

Here’s the trailer:

And here’s a video showcasing some of the tech behind the game. None of this will really be new to fans of the latest Western games — in fact, it’s pretty weak in comparison — but these graphics are lightyears ahead of most of the games dominating the Chinese market:

A report from a Chinese news site suggests that Apple (NASDAQ:AAPL) has adjusted its ranking rules and algorithm for the iTunes App Store in an apparent bid to punish developers who use third-party services to manipulate their apps’ rankings. Apple first tweaked its system last April [1], making sheer download volume less of a factor in an app’s standing in the store.

Looking only at Chinese-made apps, it can be seen that there have indeed been some major shifts this week. The changes have occurred between March 21st and March 26th, as observed on the Chinese localization of Apple’s app store. A big loser in this ranking re-jig was social network company Renren (NYSE:RENN), whose three social gaming titles for iOS saw significant drops of over 200 places. Other huge fallers included apps by local startups, such as Buding Movie Tickets, Yi Xia, and the e-commerce site Dangdang (NYSE:DANG). Being supposedly quality apps from reputable companies, we don’t think that they have in some way ‘gamed’ the ranking system, but nonetheless Apple seems to have changed something that has seriously demoted these apps.

The Chinese developer KoramGame received the biggest punishment, however. Between the two dates over the last week, its game called Feng Wan Three Kingdoms dropped from fourth place to 335th. Its app page on iTunes – see it here – is filled with 302 five-star reviews and 51 one-star reviews, with little in-between. It sounds suspicious, and apparently Apple has found reason to give it the toughest sanction.

But there were some other good titles that rose up, many of which we’ve also covered before, such as apps from Chinese banks ICBC and CCB, 360Buy’s online shopping app, Huofar, Pulse Business Cards, Youdao Cloud Notes, and Tencent’s QQ Mailbox. Those all saw their standings rise by over 100 places.

The Chinese social network Douban was both a winner and a loser in this reshuffling, with its Dujiao LBS app plummeting while its recently-updated Douban FM social music app soared from 202nd to 126th position in the Chinese iTunes App Store classifications.

In the past, such algorithm changes have been done to beat the cheats, so there’ll be the suspicion that this was the case this week. Possible means of cheating include excessive amounts of paid-for five-star comments – or negative ones aimed at competitors – and bizarre spikes in downloads or in-app purchases. There’s talk in the Chinese app dev industry that as many as ten percent of the top 100 Chinese apps on iOS are cheating the system.

Apple will likely never reveal what’s the true ‘weight’ or make-up of its App Store rankings. To developers, a high rank is critical for increased exposure. The Cupertino company acquired the app search startup Chomp last month, and perhaps some of its know-how is now being put into an attempt at a fairer assessment of which are the apps that people truly use and cherish.

It should be noted that Netease (NASDAQ:NTES), which produced this article today on its news portal, is itself a major Chinese web company that also makes a number of apps. Indeed, the aforementioned Youdao Cloud Notes app is made by the company.

[Source: Netease Tech - article in Chinese]

Chinese game sites are all atwitter with the announcement of an announcement about “Game-X”, the codename for an upcoming 3D game by Netease. That sound vague enough for you? We’ll learn more at the actual announcement on March 30th, but the details that we’ve got now definitely have us interested…and puzzled.

We know it’s a 3D game, and it’s being touted as using “next generation technology” by Netease. We know the theme of the game is “All you ever dreamed of, now made real.” And we’ve got some official images that are pretty puzzling. There is, for example, the above image that appears to show a realistic plane, and then the images below, which seem to depict a fantasy type setting, and then what I would describe as some kind of pollution monster in what looks like ancient Mesopotamia, wielding some kind of sci-fi gun. What the heck is going on here?

OK, so that’s confusing enough. But the game’s official site calls it an MMO, then implies that perhaps it isn’t an MMO in a strange survey for would-be alpha testers, which begins with a question about which game players prefer: God of War (a single-player action game with some light platforming), Devil May Cry (ditto), Uncharted (ditto, although it has multiplayer too) or Metal Gear Solid (single-player stealth).

The survey also asks questions about what you think Game-X might be, and what that image above means. It even asks whether you think Game-X should be an action game, an RTS, an RPG, or an MMORPG. Is it possible that Netease doesn’t even know what Game-X is yet?

Anyway, I suppose we’ll know more next week. Until then, you’re welcome to puzzle over the clues for yourself and try to sign up for the alpha if you can figure out the “correct” answers to the baffling questions.

Blizzard and Netease (NASDAQ:NTES) announced today that Netease will continue to be the China publisher and operator for Blizzard’s smash-hit World of Warcraft. The renewal gives Netease another three years and ensures that they will be around for the launch of the Mists of Pandaria expansion, which is sure to be popular in China because it’s about pandas.

This news puts an end to rumors that Netease might lose the WoW license to Tencent, and it also makes it much more likely that Netease will also be given the license to any new Blizzard games released in the next three years. This almost certainly means that it will get Diablo 3 and the next Starcraft expansion, both of which should come out this year, although mainland China releases will inevitably come later.

But Blizzard has also been working on an as-yet-unannounced new MMORPG code-named Titan. Given how slowly Blizzard works, there’s a good chance this game won’t be released in the next three years, but if it is, that could be great news for Netease, as Blizzard’s previous MMORPG (World of Warcraft) has made boatloads of money. I mean that literally, the amount of money WoW has made could fill large boats.

Of course, that’s all speculative. For now, all we know for sure is that Netease will remain the WoW publisher for the next three years, and it also has licenses to operate Starcraft 2 and Battle.net. I expect we’ll hear quite soon Netease is also the official Diablo 3 operator in China, but beyond that, we’ll have to wait and see.

Here’s the full press release, if you’re into that sort of action.

Alibaba's ads in action on its ad platform page.

New stats just released by Analysys International show the online ad market in China expanding once again, with Alibaba and Baidu (NASDAQ:BIDU) showing the most growth, while Google’s (NASDAQ:GOOG) China advertising market share shrinks back further.

The Q4 2011 online ad market share – calculated by revenue – shows that the never-ending boom in e-commerce, coupled with Alibaba’s leadership of it in the B2C (Tmall) and C2C (Taobao) sectors, means that Alibaba’s aggressive ad platform push has resulted in 49 percent growth year-on-year, now standing at 17.4 percent. That’s the strongest proportional growth.

Baidu’s online ads account for 30.5 percent of revenue, up slightly over the previous year. Analysys International puts this down to a government push to get small- and medium enterprises (SMEs) online and engaged with internet search marketing. Google remains in third, now ebbing down to 6.5 percent. Sohu has remained stagnant year-on-year.

Sina saw a significant loss of market share, indicating that its traditional web portal has weakened its ad platform; plus, it doesn’t seem to have capitalised on its social success with Sina Weibo in order to turn that around.

Soufun might be the only unfamiliar name to readers. It’s a heavily-trafficked real-estate web portal, carrying mostly ads for housing developments.

Here are the Q4 2011 stats in contrast to the same period a year before:

[Source: Analysis International for Q4 2011 and Q4 2010]

Real-name registration is coming to Chinese microblogs. Perhaps in protest of that, or just in protest of China’s internet situation in general, one Chinese netizen claims to have successfully used Fang Binxing’s — the father of China’s Great Firewall — state ID number to register a Netease Weibo account.

Now, Netease Weibo is not the most popular Chinese microblogging site. Nor is Fang Binxing likely to be interested in microblogging anytime soon; in 2010 he opened a Sina Weibo account that was instantly inundated with so many angry comments that he was forced to abandon it. But the use of his information to register an account is an interesting sort of protest both against him and against the real-name restrictions themselves. It certainly undermines the idea that the real-name system will be free of fraud and fake accounts. After all, if a random netizen can make an account using the identity of one of the nation’s top cybersecurity experts, how secure can it possibly be?

At present, the news is just being reported by the user in question via Twitter — see the original tweet embedded below — so we can’t be sure whether it’s true. It’s also unclear how exactly the user got access to Fang Binxing’s state ID number, which is needed to register a microblog account.

I have contacted the user and will update this post if we hear back.

用方校长的身份证号完成了网易微博的身份认证。 twitter.com/HeroleeCN/stat…

— Herolee™ (@HeroleeCN) March 5, 2012

[via @isaac]

Starting this morning, Baidu (NASDAQ:BIDU) is adding search results from Chinese microblog site Sina Weibo, giving its search engine users quick access to tweets on trending topics.

The very recent tweets will show in a box clearly marked ‘newest weibo results’ on the first page of a Baidu search for any names or phrases that happen to be popular/trending [1] at the time. For example, if I search for ‘Windows 8’ in Chinese, I get three relevant Weibo tweets (as pictured above).

As is inevitable when linking to random microbloggers, the results can be a mixed bag, so only one of the tweets proved useful in my test, taking me to a video news report about the Windows 8 launch. One way for Baidu to improve this is by taking you to the actual tweet page, not the Weibo user’s homepage (as currently occurs). Also, it would be useful to scroll through some more microblog results, as can be done with Google’s collated Twitter search results.

This initiative by Baidu isn’t entirely new, as the search engine giant has already tied up with three other microblog sites in China: Tencent’s (HKG:0700) Weibo, plus the less used Netease (NASDAQ:NTES) and Sohu (NASDAQ:SOHU) Weibo platforms as well. So, today the picture is complete with added support for the Sina (NASDAQ:SINA) service. Even though Tencent’s site has more registered users – a whopping 300 million – today’s addition is important because Sina’s service seems to have the most buzz, more media mentions, and allegedly also has the lion’s share of wealthier urban users.

Announcing the new Sina Weibo searches, Baidu’s executive assistant, Zhang Dong-cheng, said:

We process billions of search queries on a daily basis, and many of those queries are related to the real-time information found on microblog posts. With this deal between Baidu and Sina Weibo, Baidu has completed its integration of high-quality content from China’s four leading microblog platforms.

In the same joint Sina-Baidu press release, Sina’s VP, Peng Shao-bin, said that his company’s Weibo service sees “100 million microblog posts daily” and can thereby provide “quality real-time information.”

Exactly two weeks from today, all microblog sites must start to enforce ‘real name’ tweeting, meaning that any users who have not submitted their names and national ID numbers to the web companies will no longer be able to post. That could cause the number of daily microblog posts to fall off a cliff.

With smartphone usage in China on the rise, Netease (NASDAQ:NTES) has today announced that its Evernote-style cloud notes app, Youdao YunBiJi, has reached just over two million users. The service launched in June 2011.

With apps for Windows, iPhone, iPad (pictured above), and Android – as well as a mobile website interface – the company says that its mobile users are spread pretty much 50-50 across iOS and Android. Youdao YunBiJi supports text notes, images, text-recognition from images, and Chinese handwriting input.

In contrast to Youdao Yunbiji, US-based Evernote says it has an impressive eight million active monthly users with way more registered users on board, and a full 750,000 who’re paying for premium accounts. Netease’s Youdao Yunbiji doesn’t have such paid services and is instead offered for free as part of its broader ecosystem of email, search, news, gaming, and video. But its two million milestone is impressive for such a new app in a very fragmented marketplace.

Netease’s notes app has essentially the same name as that of a startup’s effort, YunBiJi, which we looked at last October and declared it to be the best-looking Chinese notes app out there. The smaller company’s app retains some plus points – such as its looks, and a recently-released desktop version for Mac – but it’s probably going to be steamrollered in terms of SEO and user numbers by the Chinese web giant.

Netease is best known for its social gaming and email services (the latter of which will soon be integrated into Mac OS X), but it is increasingly pushing into mobile apps these days, such as with YunBiJi as well as its own Flipboard clone news-reading service.

[Source: Donews - article in Chinese]

Browsing the news this morning, I spotted a rumor that Netease may be poised to launch a DOTA-style game of its own next month. DOTA is very popular here, and a domestic take on it could be interesting. Then I read the second half of the headline: “…it may be called Heroes of the Three Kingdoms.” Oh. Excitement deleted.

The Three Kingdoms is actually a historical period of Chinese history, but games about it are generally based on the book Romance of the Three Kingdoms, one of the four great classics of Chinese literature. I’ve read it, and it’s not hard to understand why; the book is full of exciting twists, really memorable characters, and clever strategic one-upsmanship between the generals fighting for each of the titular kingdoms. These are really interesting stories, and that’s part of why they resonate so strongly after hundreds and hundreds of years.

That said, could we please have some games that are based on something else? Chinese devs seem to be the worst about this (note, for example, the four Three Kingdoms games GREE just picked up, all the developers are in China), but there are plenty of Three Kingdoms games coming from other Asian countries too, especially Japan. In China, though, it seems almost as if “Three Kingdoms” is the default setting for any developer looking to make a game, virtually regardless of the genre. Many Three Kingdoms games are role-playing games, but I’ve even seen a Three Kingdoms card game. On the front page of Sina Weibo’s games section, there are four different Three Kingdoms games right now.

It really has gotten out of hand. Here are just a few Three Kingdoms games, whose titles I’m translating directly from Chinese: Three Kingdoms Killing, Hot Blood of the Three Kingdoms, Dream of the Three Kingdoms, Legends of the Three Kingdoms Heroes, Three Kingdoms Battle Records, Three Kingdoms RPG （winner of the ‘Least Creative Title’ award!), Rise of the Heroes of the Three Kingdoms, Fantasy of the Will of the Three Kingdoms, Romance of the Three Kingdoms, Three Kingdoms Tactics, and Interstellar Three Kingdoms, because apparently even space isn’t far enough to get away from the Three Kingdoms. That’s just a partial list, by the way. I could keep going (and that’s just a partial list, too).

Of course, Western game developers are just as guilty of this, although their way oversaturated historical period of choice is World War II. Moreover, I understand that there are some very good reasons to do make a Three Kingdoms game. For one, people love them! The characters and stories are already popular, and a number of Three Kingdoms games and series have been extremely successful in China and elsewhere in Asia, so it makes business sense.

That said, it’s also kind of lazy. The plot and the characters are written for you. The setting is more or less designed. And if you’re not sure where to take things during the development process, you’ve got a hundred other games on the same topic that you can imitate. That’s not to say it’s impossible to make a unique, interesting game about the Three Kingdoms, of course, but at this point, I think it’d be pretty damn hard. Someone has already made Three Kingdoms in space. What could you possible bring to the table that no one has seen before?

Plus, there are so many other things you can do with games! Even restricting yourself to time periods in Chinese history, there are plenty of great stories for games that aren’t getting used because everyone’s making games about the same few Three Kingdoms bigwigs over and over again. And look, I love Zhuge Liang as much as anyone. That trick with the arrows? Awesome. But let’s give some other time periods, some other people, some other settings a chance, OK?

Please?

Apple (NASDAQ:AAPL) has just released an early preview of its next version of Mac OS X, which will be called Mountain Lion. Along with a bunch of new features come several that are aimed exclusively at Chinese users. And so the update, which will go on sale this summer and be numbered 10.8, adds five elements that’ll be useful for users in China. They are:

• Support for Tencent QQ, and Netease 163 or 126 email, in the Mail, Contacts, and Calendar part of the settings.

• Support for login to Sina Weibo in the same settings panel for faster sharing to Weibo from certain apps.

• Similarly to the above, Chinese video-sharing websites Youku and Tudou are ‘share’ options in a number of apps, such as in QuickTime.

• Baidu is a search option built in to the Safari web browser.

• Improved, faster Chinese text input with a revamped input method editor.

That all sounds like good news for Youku (NYSE:YOKU), Baidu (NASDAQ:BIDU), Sina (NASDAQ:SINA), et al, though not such good news for Tencent’s (HKG:0700) own microblogging platform, which has been left out of the action. To be frank, very few Chinese people use the Mac OS, but it’s nice to see Apple making an effort – probably done with a view to getting even more people in the country onto iOS and onboard with the whole Apple ecosystem.

The Chinese version of the Apple site doesn’t yet have any information about Mountain Lion, but the international site has a new preview mini-site for OS 10.8 which has a section called ‘All-new features for China’ that outlines those core improvements.

Judging by the contrasting images of the Mail, Contacts, and Calendar pane (above is from Apple, below are two from The Verge’s video demo), that part of the settings will look different depending on what language the OS is set to.

We saw a similar addition of Chinese localization in iOS 5 back in June of last year, when the same three email services were added to Apple’s mobile OS.

See the whole range of new features on the Mountain Lion mini-site.

Two stills from the video demo of Mac 10.8 made by The Verge.

The rumor, based on an implication in a report from Lyon Securities that Netease has already gotten the contract, hasn’t been confirmed yet by either party, so take it with a grain of salt. That said, it shouldn’t come as a surprise. Netease operates Blizzard’s Battlenet service — which Diablo 3 will use — as well as World of Warcraft and StarCraft 2 in China.

I’ll be following Diablo 3 closely so I’ll be sure to let you know when there’s an official announcement.

[via Sina Games]

This is just my own mockup of how Netease's system might look...

In response to a worrying wave of online account hacking in China in the past week, the web giant Netease (NASDAQ:NTES) has said that it’ll implement webcam-powered facial recognition logins to its 163 and 126.com email services. That’ll come, the company says, in the first half of next year; it also promises that the upcoming system will not fail to recognise users, and that it cannot be fooled by showing a photo.

It’s a nice idea, but it remains to be seen if it will be useful, or a mere gimmick. Presumably, a conventional password is still needed as a backup – and for other methods of email access, such as IMAP on smartphones – and so there’s still a risk of having one’s login credentials exposed when there’s a malicious leak of data. And we haven’t even begun to discuss the dangers of evil identical twins. So, colour us skeptical for the time being.

Security breaches this week have hit Netease’s mail itself – both of which are among China’s top web-mail providers – as well as various e-commerce firms and social media.

Facial recognition has been rolled out to ordinary consumers in a handful of computer manufacturer’s custom login systems, and was recently implemented into the latest version of Android 4.0, Google’s (NASDAQ:GOOG) mobile OS. On Android, that recognition system is still backed-up by either a PIN number or on-screen pattern.

Google’s Gmail earlier this year took a different approach to security – and one which works across both desktop and mobile. It’s called two-step authentication, and requires users to generate an extra code in an app each time they log-in to to Gmail in an unfamiliar device or location.

Hit the comments below if you’d like to share your own method of securing your numerous web logins.

[Source: China Business Media]

E-commerce in China is such a boom industry that virtually every story on the subject on our site this year has been about growth, profits, and potential. But there’s no such luck for Netease (NASDAQ:NTES), which has announced that its high-end fashion store, Luxury163, will not survive into 2012, vanishing off of the web just before midnight on December 31st.

Netease is better known for its 163Mail service or its online gaming titles – but success remained elusive for its Luxury163 site, despite rising incomes in China and growing demand for designer brands. The online mall – at l.163.com – has genuine products from the likes of Hermes, Coach, and Victoria’s Secret; but it apparently was not profitable enough to maintain. The site will go offline on Saturday night, and will maintain customer service for two weeks longer in case any recent purchases need to be refunded.

Despite Netease’s failure, the high-fashion e-commerce party is rocking for everyone else at the moment, with new rivals including 360Buy’s recent move into couture brands, 360Top, Sina’s (NASDAQ:SINA) own ‘Luxury’ online mall, more funding for The Luxury Club, and the late arrival of Gaojie. And that’s to say nothing of VIPStore, Xiu, iHush, or iHaveU.

No very specific reason was given for Netease’s shuttering of Luxury163 except the announcement saying that it’s “due to business restructuring.” It launched in January of this year.

[Source: Techweb - article in Chinese]

As the uproar over the release of the usernames and passwords of millions of users from Tianya, CDSN, and other Chinese web services continues, there are signs that an even larger service may have come under some kind of attack: Netease.

Netease operates one of China’s most popular free email services, and it is that service that has reportedly come under attack. According to TechWeb, news that Netease’s email servers had been attacked was posted on a public forum for reporting hacks earlier this afternoon, and numerous users have since reported their accounts have been compromised.

Unlike the other hacks we’ve seen over the last week, which were actually just public dumps of old username and password databanks, the Netease exploit appears to be an attack in progress. Specifically, users are reporting that suddenly their account is tied to a strange QQ account in the “recover password” section of the site. This means, in essence, that whoever owns those strange QQ accounts has the power to recover other users’ passwords, and even change them so that the original user no longer has access to their account. At least one Netease user has also reported that they were unable to change the QQ number, and that after contacting Netease’s customer service team, they were told to simply register a new account.

Netease has yet to officially respond to these reports, so for now, they should be taken with a grain of salt. If nothing else, though, the reports can be seen as the latest evidence that hacking and information security have suddenly become a big topic of conversation in the Chinese media.

So, being Blizzard’s WoW operating partner in China has always been a coveted position, and it’s a partnership Blizzard has already shown it is willing to reevaluate. In 2009, for example, they ditched local partners The9 and took up with Netease. Now, rumors are swirling on Weibo that Blizzard is in talks with Tencent, and considering dropping Netease and going with Tencent as the new China WoW operator.

But you might want to take these rumors with a few grains of salt. Blizzard has already responded to the rumors, saying it hopes to continue working with Netease. Netease hasn’t said anything, but industry experts and insiders seem to agree that a Blizzard-Tencent deal is pretty unlikely.

Why? There are a number of reasons, but two of the most compelling are that Tencent is already partnered with Blizzard rival NCsoft and that Tencent already has many games competing with WoW that would profit if Tencent were able to get control of WoW and, er, run it into the ground. Moreover, Tencent has been showing signs it is seriously eyeing the international gaming market, and might be looking to become a Blizzard competitor in its own right.

So is Blizzard thinking of switching to Tencent? Probably not. But hey, you never know. Plus, we need something to talk about while we’re waiting around for that panda expansion pack, right?

(Just kidding, you should all be playing Skyrim instead).

[DoNews via Sina Tech]

(Photo source: People's Daily Online)

Despite fears of a very bad year for Chinese tech stocks after the fraud at Longtop (formerly NASDAQ: LFT), a new list from China Analyst reveals that the majority of the top ten most profitable U.S.-listed Chinese stocks for the last 12 months were tech/web companies.

It’s actually doubly surprising, after an IPO Dashboard study back in October showed that tech IPOs were performing the worst, with an average growth rate of -19.43 percent. Yep, that’s a minus symbol right there. But, from the look of the top ten list, a number of China’s web behemoths weathered a stormy year.

Out of the ten on the line-up, eight are tech/web companies, and mostly big hitters:

1. Giant Interactive (NYSE:GA):
Giant isn’t even China’s biggest online gaming publisher, but it’s doing well, seeing its net profit margin at 52.23 percent for the last 12 months, and its operating profit margin was at 55.76 percent for the same period.

When we last looked at market share in online gaming in China in terms of revenue, Giant was in sixth place, while Changyou (below) was fifth.

2. Changyou (NASDAQ:CYOU):
Proving that social gaming and MMOs can be great business, Changyou is in the exact same field as Giant. Its net profit margin was 50.66 percent for the last 12 months. Its operating profit margin was 57.94 percent for the same period.

3. Baidu (NASDAQ:BIDU):
Baidu needs no introduction, and can now lay claim to being China’s third most profitable US-listed stock this year. Its net profit margin was 46 percent for the last 12 months. Its operating profit margin was 52.53 percent for the same period.

4. Netease (NASDAQ:NTES):
Netease is actually in third place in terms of online gaming revenue in the country, but it’s fourth in this particular list. The company might be better known for its 163.com web portal and email service, and its fledgling Youdao.com search engine. Its net profit margin was 44.36 percent for the last 12 months. Its operating profit margin was 46.77 percent for the same period.

7. SouFun (NYSE:SFUN):
Skipping down to seventh place in this ranking, SouFun is a massively popular real-estate portal. Its net profit margin was 33.83 percent for the last 12 months and its operating profit margin was 41.57 percent for the same period.

8. Ctrip (NASDAQ:CTRP):
Ctrip is a travel e-commerce site whose main rivals are eLong (NASDAQ:LONG) and the Baidu-invested Qunar. Its net profit margin was 32.11 percent for the last 12 months. Its operating profit margin was 33.57 percent for the same period.

9. AutoNavi (NASDAQ:AMAP):
AutoNavi makes GPS gear and apps, and it certainly didn’t get lost en route to a profitable year. Its net profit margin was 32.10 percent for the last 12 months and its operating profit margin was 30.98 percent for the same period.

10. Sohu (NASDAQ:SOHU):
Lastly, another old-skool Chinese web portal shows that dinosaurs can learn how to stay relevant – are you watching, Yahoo (NASQAQ:YHOO)? – with profit margins of 30.61 percent for the last 12 months and an operating profit margin of 34.88 percent for the same period.

If you’re curious, the missing fifth and sixth places belong to China Kanghui Holdings (NYSE:KH), and Noah Holdings (NYSE:NOAH) respectively, neither of which are tech or web related.

[Source: China Analyst]

The Chinese internet company Netease (NASDAQ:NTES) will launch its own separate product search engine next year, according to the company’s VP, Jin Lei.

At present, Netease has a general web search engine – Youdao.com, which has less than one percent of market share – which already has a shopping search function (pictured above). But clearly Netease deems China’s B2C e-commerce market to be massive enough to warrant a stronger strategic push into making a product search engine. But Mr. Jin did not specify how the new venture will improve on what his company is doing already, aside from the separate URL.

But he did reveal how Youdao’s shopping search function is performing so far, claiming that it has generated 50 million transactions per month on the B2C sites that it indexes, and that 11 million users find it an important online shopping tool.

Assailing Etao

The move will pit Netease even more directly against Alibaba, which has its own Etao.com product search engine. Etao has drawn some indignation in the industry this year, with a few e-commerce rivals to Alibaba attempting to weaken its search prowess by blocking Etao’s ‘web spiders’ from indexing its online stores. Despite Alibaba’s insistence that Etao is an impartial search engine that won’t favour the company’s own B2C site, Netease will find it easier to paint itself as a fair and balanced alternative.

Last time we checked in on Netease’s Youdao site, it had a mere 0.31 percent of the search engine market in China, pushed down into fifth place by slightly stronger efforts from Tencent (HKG:0700) and Sohu (NASDAQ:SOHU).

[Source: TechWeb - article in Chinese]

Netease (NASDAQ: NTES) is famous for its portals and email services. But for microblogging, it is certainly behind Sina and Tencent. Yet in the unaudited financial results Netease released yesterday, it was reported that its microblogging platform has a whopping 88.5 million users, an improvement of 68.6 percent since the second quarter. Wow!

But again, how many of these registered users are active? We did ask, but Netease didn’t reply.

Out of curiosity, I registered an account to check out how Netease Weibo looks and feels. It looks similar to Sina Weibo with similar functions, except that users are allowed to write up to 163 characters for each weibo, which is in line with 163.com, Netease’s domain.

Most of the tech Chinese tech folks are there — For example, 36kr, a popular Chinese tech blog in China has an account but last used Netease Weibo four months ago. The same goes for Lee Kai-fu of Innovation works who last used the service in March this year.

Anyway, it is harsh to bash Netease for its Weibo service since it isn’t at all its core business. Email, news, and games are its core services — there are 430 million Netease email users.

Netease also develops its own games as well as helping other gaming companies to distribute theirs. One of its client, for example, is the super-addictive World of Warcraft MMORPG by Blizzard. The company’s revenue from online gaming hit $1.8 billion RMB, which was 90 percent of its total revenue in the third quarter.

Connected globally: Twitter during the Japan earthquake

There’s an interesting new report out from report from KPCB on internet trends. Among other things, the report ranks 25 top global companies according to 2011 market value. While more than half of the top companies in that group are from the US, Asia is well represented.

From China we have Baidu at the top with a $46 billion market value. It’s followed by Tencent, Netease, Alibaba, Ctrip, and Sina in that order. For Japan, we have Yahoo Japan and Rakuten representing, while NHN (which operates Naver) in the lone Korean company to break the top 25.

Citing comScore, KCPB’s Mary Meeker says that 81 percent of users of top websites are outside of the US. It also points out that in three years (2007 to 2010), China has added more internet users than the USA has in total (246 million vs 244 million). Of course, as we recently reported, the total amount of internet users for China now stands at over 500 million.

Here’s a chart showing the top 25 companies ranked according to market value, according to the report. Click on each one to view 2011 market value in billions and 2010 revenue in millions (in parens). If you have trouble viewing, here it is as a static image.

Weird, right? But apparently it’s weird in a good way, because the video — which was just posted on Youku yesterday — has already racked up over 100,000 plays. That’s not a huge surprise given that the game itself is one of China’s most popular, with millions of players and fans.

The game was developed and is run by NetEase, and has been around for quite a while now. As you can see in the video, it’s not exactly up to modern graphical standards, but then again, neither is Blizzard’s World of Warcraft, another MMORPG that’s hooked millions of gamers. Apparently, Fantasy Westward Journey has that intangible addictive quality that keeps people coming back year after year even as newer titles flood the market.

And of course, having a pretty attention-grabbing viral video helps too.

[video and image via chinaSMACK Advertising]

A scene from Tencent's 'Crossfire' first-person shooter game. (Image credit: cf.131.com)

New figures for Q2 2011 show which Chinese tech companies get the biggest slice of the online gaming market in China, in terms of revenue. Total revenue in the industry is 8.7 billion RMB (US$1.36 bil), which is up 3.1 percent on the previous quarter.

Tencent is still the online and social gaming king in China, with its broad spread of titles – from numerous QQ games, to its Zynga CityVille tie-up, to the 3D first-person shooter Crossfire (pictured above). It took 29.5 percent of all online gaming revenue in the country in the most recent quarter.

Shanda and Netease are joined for second place with a matching 17.1 percent of revenues in the market. Shanda has titles such as the newly-released World Zero, while Netease is known for MMORPGs like Westward Journey.

Beijing’s Perfect World (NASDAQ: PWRD) is in fourth place in Q2 2011; and slightly trailing them is ChangYou, which is a subsidiary of Sohu. We recently looked at how ChangYou had spent $80 million in developing its newest game The Deer and the Cauldron.

Here’s our interactive graph of all the online gaming market shares; data comes from Analysis International and was then compiled by Digitimes:

[Source: Analysis International, via Digitimes]

Sina reported its Q2 financials today, revealing a net income of just $10 million, down from $25 million last year. What caused the drop? Sina Weibo. Sina’s microblogging platform has grown to become the dominant one in China, but the company has been slow to monetize it. In July, Sina announced the launch of a Weibo micro-currency and social games, but it’s too early to tell whether or not those initiatives will help Sina earn back some of the money it has been spending on Weibo.

Netease also announced its Q2 results today. It’s apparently doing quite well, with net revenues of about $280 million and profits of $120 million US. That’s a 59 percent jump from Q2 2010.

Tudou saw a bit of a blemish on its successful IPO last night, as shares opened down 13 percent from their offer price and finished the first day still 12 percent down. Still, given the horrible state of the market right now, Tudou’s performance on day one wasn’t too bad, even if it doesn’t compare to the massive first-day jumps of Chinese net stocks in happier times.

Baidu stock has been dropping all week under the weight of a series of attacks from CCTV accusing the company of all manner of bad practices. But it ended yesterday slightly up as it becomes more and more clear that the CCTV attacks represent some kind of vendetta against the company rather than unbiased investigative reporting.

Youku was one of the few companies to see a small bump in its stock yesterday, which ended the first day of rival Tudou’s launch up almost 13 percent partially on the news of a rumored cooperation with Tencent.

To investors, Netease is NASDAQ: NTES – and one of the first Chinese web/tech IPOs, way back in 1999.

Though its web portal – at 163.com – has millions of monthly visitors, it’s gaming that makes up the bulk of Netease’s revenue.

Indeed, this detailed look ‘Inside Netease’ (see the slideshow below) made by the folks at iChinaStock reveals that 87.4 percent of revenue comes from online game services, and a mere 11.2 percent from advertising. That shows the dangers of being a web portal that doesn’t have either value-added services (VAS) or a social platform (such as Sina quickly built with its Weibo).

Actually, Netease has both those, with its own microblogging platform as well, at t.163.com. Its standalone search engine, Youdao.com, is also integrated into its web portal.

In addition to all that, Netease’s web mail looks set to get a boost in the coming months when it gets integrated into the Mail app in iPhones and iPads, when iOS 5 rolls out.

Here’s the slideshow:

[Source: iChinaStock]

Pictured above are the current front pages at video-sharing site Youku.com, and web portals Netease (163.com) and Sina.com.cn, two full days before the event. Most websites that I’ve spotted running the regalia have opted to include a ‘close’ button which can return the site to its ordinary clothing.

It’s not clear if the sites are running the red livery as a spontaneous celebration, or if their hand is being somewhat forced by the Central Propaganda Department, which issues weekly directives to all media outlets, instructing them on what to say – and what not to say – so as to tow the Party line.

Either way, even foreign websites such as MSN China are likely to be making the east red as the anniversary date nears, and China’s biggest search engine, Baidu, will likely have a CPC-themed doodle come July 1st.

If you’d like to see some suitably revolutionary songs, you might like to check out the four videos of foreigners rocking some Chinese tunes that we posted a few weeks ago.

These three new mail presets will make it a lot easier for Chinese users who don’t use Gmail – ie: the majority of people here – to set up push email on their iPhone when the new iOS is released. Previously, using these – or any other web email service apart from Gmail, Yahoo, or AOL – required hitting the ‘Other’ tab and going along a convoluted trail of manual IMAP server inputs.

Electronista.com noticed the new feature today, following the release of iOS 5 Beta 2 a few days ago. The picture above is my own mock-up, and not a screenshot of the revamped ‘Add Account’ Mail app screen.

Presuming no other Chinese web mail services get added prior to iOS 5 rolling out later this year, then it means Sina has been left out in the cold, which’d be a bit of a blow in its escalating battles with Tencent, whose more popular QQ Mail will be preset into the iPhone and iPad Mail app.

With Apple’s COO, Tim Cook spotted in China Mobile HQ in Beijing this week – and now this added Chinese feature in iOS 5 – there will be more speculation that a China Mobile exclusive iPhone, using that network’s own TD-SCDMA 3G, might be coming this year.

Source: Electronista article about 3G OTA updates and added Chinese mail support in iOS 5 Beta 2.

Baidu, the leading search engine in China, accounted for 77.6 percent of the total search market revenue in Q1, a whopping $382 million. Google, in second place, took 19.7 percent, at $97 million. Looking back on the previous quarter, we can see that Baidu has increased its revenue share by 2.8%, while Google has dropped by 5.1% (below).

It is clear that Google and Baidu are moving in opposite directions. Google continues to lose revenue with as the other Chinese search engines eat up its share. This Q1 result is likely just the beginning of a very long, difficult year Google. Meanwhile Baidu keeps on chugging, with rumors that she is courting multiple partners (Facebook and now Microsoft) after Google’s withdrawal.

The research firm outlines in its 150-page paper that Tencent led the market with $1.4 billion in revenue, followed by Netease with $749 million, Shanda Games with $680 million, Perfect World with $374 million, and then Changyou with $327 million.

This rapid growth spurt puts China ahead of the U.S game industry which fell to 22% according to The People’s Daily citing Digi-Capital. That dramatic headline read “Game over for US: China to take lead in video games.”

With an increased number of mergers and acquisitions over the course of 2011, Pearl Research expects China to expand out beyond domestic markets.

We recently reported that China’s Sina Weibo has also witnessed astronomical growth hitting 100 million users in February 2011. Given the astounding statistics regarding China’s overall digital rise, we expect that the nation will continue to make its mark on global industries as it strives to become a world leader.

Photo: China.org.cn

But today Baidu decided to let me do more inside its search box, and sadly, this is where the comparisons to my high-school girlfriend end.

Users searching on Baidu will be given the option of ‘Tweeting’ (or microblogging) their search term, only if it resembles a Tweet.

If the search term includes certain adverbs like ‘very’ or ‘extremely,’ or if it ends with an exclamation point or a particle that makes it look like a spoken sentence, then you’re presented with the microblog buttons. Users can choose from Tencent, Sohu, or Netease microblog services. Note that there’s no Twitter there, of course. Still blocked.

This new function is a clever addition by Baidu, capitalizing on the growing popularity of microblogging in China, as well as the fact that the majority of users do their microblogging via the web. This gives the many Chinese netizens who regularly search on Baidu, yet another reason to stay right where they are.

The alternative common alternative, Google, which is having a little trouble these days anyhow.

According to iResearch, microblogging site Sina Weibo (China’s Twitter) holds a clear lead over competitors such as Tencent and Baidu, with 56.5% of the market based on active users and 86.6% based on browsing time.

Sina Weibo has shown staggering growth in a very short time, having accumulated about 100 million users since its beta launch in 2009. Another recent paper from Incitez cites the microblog as winning 10 million new users per month, putting them on pace to surpass 150 million sometime this year.

Celebrities (Tom Cruise is on board), corporations, and even government officials flocking to Sina Weibo in growing numbers. The site is growing fast in Taiwain and Hong Kong too.

This past December the company purchased the t.cn domain name for 5 million yuan, and it now redirects to the microblog site. The memorable URL is currently being used for the websites’ link shortener as well.

The appeal of Sina Weibo and other microblogs in China can be likened to the appeal of Twitter elsewhere. Netizens get the information they want in faster, more personalized stream that contrasts greatly with traditional media and news.

But for a look at what makes this site stand out from Twitter, see our post ‘What Twitter could learn from China’s Sina Weibo‘ from earlier this year.