Showing posts with label business model. Show all posts
Showing posts with label business model. Show all posts
An enquiry to the fall of Cyvee.com
Sep 4, 2008Posted by
Anh Hung Nguyen
Cyvee.com was launched as an experiment at vnSpoken.com in March and at that time gathered quite a lot of coverage from local newspapers and received an investment deal from IDG Venture, a tech venture capital. I was fascinated by the emergence of yet another web 2.0 start-up in Vietnam and immediately joined the site.
Targeting the wrong audience
Connecting professionals? How many "professional" companies are there in Vietnam? How many professionals are actually working in those companies? And how many professionals are working in those that are not considered professional? And how many people out of those have frequent access to the Internet? But the question is: how does Cyvee define professionalism in a Vietnamese context, where most are still farmers and most of those corporate workers are not of industrial quality.
I would say the people that Cyvee's been targeting make up quite a small userbase and unfortunately the people who they are not aiming at, and who think of themselves as professionals 've also jumped on the bandwagon.
This makes Cyvee people a mixture of everyone, either professionals or not. And this has severely affected the quality of user-generated content on the site, which puts people away because they find it so bizarrely confusing. If you look at how people interact with each other on Cyvee, you will see what I mean.
I think Cyvee has failed since they got the ball rolling.
A bit of everything
Idea? LinkedIn. Q&A? LinkedIn. Slogan? Nokia. News? Digg.com. Groups and Quick Comments. Facebook. Jobs? Thousands of other sites.
Instead of going into detail of each and every of them, I would propose to analyze the business model that Cyvee is currently applying and from that depict the failure of it becoming a successful technology start-up.
The underlying monetary system of Cyvee is CVD, or Cyvee Dollars. This is the second reason why it fails.
Take a look at LinkedIn. Does it cost you anything to connect to people? None. Money seems to be a problem at Cyvee and this is a deterrent to people who want to expand their network. Who would pay 1.500VND for 10 contacts. I'm not buying my friends and connections. One friend is worth 1.500VND? Seriously, this is a joke. I'd rather pay nothing to get friends or pay nothing for nothing. And even if someone is keen to pay, how much would they get?
Let me draw you to a smarter way of making money. It's Twitter, our beloved friend. Twitter is making money by charging people text messages from their mobile phone when they want to twitter an update. Certainly this costs them money but considering the current charge rate, it's not that bad. I see people text messaging all the time and they are quite happy with that.
But there are more in Twitter. What if you have 1000 friends. Would you sms every single one of them to tell them what you're doing (and an increasing number of people are using Twitter for various types of updates).
In fact, Twitter is helping people to SAVE money (and time) while at the same time bringing a great number of benefits to its customers. And this is because of this very reason that people love Twitter. They don't even feel they have to pay. It's just another text message that sometimes shocks the world. Trust me. You can rock in Twitter :)
So let's come back to Cyvee. People see very little potential in the ROI they can get from the small amount of money they spend. No matter how much the money is, it can always be a deterrent when people are not willing to pay. WTP is an important terms in economics because: people respond to incentives.
If people they have to pay to get their network expanded, they won't. And because very few of them are willing to pay, they may either wait for others to pay, or just quit the game. How do you attract customers if they feel they are being restrained from what they want to do. A company which at one time provides a good service and at another time tells its clients not to use the service in a nice way.
Ah yes, you can make CVD - Cyvee Dollars - on their site. And you will be fine. This can be achieved by either you posting a piece of news and receiving1 CVD when it gets popular (similar to Digg) or answering a question.
This is interesting to talk about. Because it looks a bit different from the way Digg functions. The news is still moderated. It means your submission has to be approved by a Cyvee editor before it gets posted. This doesn't look very interesting because it prevents information from flowing smoothly. I would rather it function the way Digg does and get each CVD for each vote my peice of news receives from readers.
Asking questions cost money, everyone. Am I willing to pay for it? Not really. I don't know if the answers I get are those that I want. Why would I pay for a product that I have no clue as to whether it would yield any benefits? This is economically flawed. Hey, I can ask 10 questions per month on Linked in, and can receive professional answers from people around the world. What gives?
Why would I, at the same time, try my best to answer a question? The usual reason would be that I want to help my peers out. But look, Cyvee puts money right into the game and it turns out it's a treasure hunt rather than a "relief effort". How ironic. Similarly, I don't know if the service I provide will yeild any benefit for me. Vietnamese online interacting behavior gives me the impression that they are generally unresponsive. Even if I give the most wonderful answer they've ever encountered, will I get some CVD? Probably no. This looks as if my service is paid entirely by the mercy of others. A professional-turned-beggar :(
Please also allow me to look at its business model from another perspective. GE is one of the most successful corporations in the world (even though it is falling pretty fast due to the transition from manufacturing to financial services). Jack Welch, the one who gave GE a name in the business arena, and the most highly respected management guru used to say: for any single area of business that is not top or next to top in the industry, forget about it.
If you look at the Cyvee website, it looks like an online corporation with various satellite companies servicing different businesses. Unfortunately, none of these is top or second.
Final words
I know the people at Cyvee have a lot of patience to wait for the day they can really achieve something. But asking your customers to be patient is simply not a smart way of doing business. If something is not about to change, they're not gonna achieve anything. Before Cyvee thinks about how to monetize their service in the way that facebook and other web 2.0 start-ups are doing, which is tremendously difficult, they should think about how to make their business sustainable in the long term and start to please their customers. I see more Cyvee people getting together offline.
E-learning 2.0 Platform
I was on a quest for a suitable Vietnamese network suitable for disadvantaged children. Cyvee didn't score.
Targeting the wrong audience
Connecting professionals? How many "professional" companies are there in Vietnam? How many professionals are actually working in those companies? And how many professionals are working in those that are not considered professional? And how many people out of those have frequent access to the Internet? But the question is: how does Cyvee define professionalism in a Vietnamese context, where most are still farmers and most of those corporate workers are not of industrial quality.
I would say the people that Cyvee's been targeting make up quite a small userbase and unfortunately the people who they are not aiming at, and who think of themselves as professionals 've also jumped on the bandwagon.
This makes Cyvee people a mixture of everyone, either professionals or not. And this has severely affected the quality of user-generated content on the site, which puts people away because they find it so bizarrely confusing. If you look at how people interact with each other on Cyvee, you will see what I mean.
I think Cyvee has failed since they got the ball rolling.
A bit of everything
Idea? LinkedIn. Q&A? LinkedIn. Slogan? Nokia. News? Digg.com. Groups and Quick Comments. Facebook. Jobs? Thousands of other sites.
Instead of going into detail of each and every of them, I would propose to analyze the business model that Cyvee is currently applying and from that depict the failure of it becoming a successful technology start-up.
The underlying monetary system of Cyvee is CVD, or Cyvee Dollars. This is the second reason why it fails.
Take a look at LinkedIn. Does it cost you anything to connect to people? None. Money seems to be a problem at Cyvee and this is a deterrent to people who want to expand their network. Who would pay 1.500VND for 10 contacts. I'm not buying my friends and connections. One friend is worth 1.500VND? Seriously, this is a joke. I'd rather pay nothing to get friends or pay nothing for nothing. And even if someone is keen to pay, how much would they get?
Let me draw you to a smarter way of making money. It's Twitter, our beloved friend. Twitter is making money by charging people text messages from their mobile phone when they want to twitter an update. Certainly this costs them money but considering the current charge rate, it's not that bad. I see people text messaging all the time and they are quite happy with that.
But there are more in Twitter. What if you have 1000 friends. Would you sms every single one of them to tell them what you're doing (and an increasing number of people are using Twitter for various types of updates).
In fact, Twitter is helping people to SAVE money (and time) while at the same time bringing a great number of benefits to its customers. And this is because of this very reason that people love Twitter. They don't even feel they have to pay. It's just another text message that sometimes shocks the world. Trust me. You can rock in Twitter :)
So let's come back to Cyvee. People see very little potential in the ROI they can get from the small amount of money they spend. No matter how much the money is, it can always be a deterrent when people are not willing to pay. WTP is an important terms in economics because: people respond to incentives.
If people they have to pay to get their network expanded, they won't. And because very few of them are willing to pay, they may either wait for others to pay, or just quit the game. How do you attract customers if they feel they are being restrained from what they want to do. A company which at one time provides a good service and at another time tells its clients not to use the service in a nice way.
Ah yes, you can make CVD - Cyvee Dollars - on their site. And you will be fine. This can be achieved by either you posting a piece of news and receiving1 CVD when it gets popular (similar to Digg) or answering a question.
This is interesting to talk about. Because it looks a bit different from the way Digg functions. The news is still moderated. It means your submission has to be approved by a Cyvee editor before it gets posted. This doesn't look very interesting because it prevents information from flowing smoothly. I would rather it function the way Digg does and get each CVD for each vote my peice of news receives from readers.
Asking questions cost money, everyone. Am I willing to pay for it? Not really. I don't know if the answers I get are those that I want. Why would I pay for a product that I have no clue as to whether it would yield any benefits? This is economically flawed. Hey, I can ask 10 questions per month on Linked in, and can receive professional answers from people around the world. What gives?
Why would I, at the same time, try my best to answer a question? The usual reason would be that I want to help my peers out. But look, Cyvee puts money right into the game and it turns out it's a treasure hunt rather than a "relief effort". How ironic. Similarly, I don't know if the service I provide will yeild any benefit for me. Vietnamese online interacting behavior gives me the impression that they are generally unresponsive. Even if I give the most wonderful answer they've ever encountered, will I get some CVD? Probably no. This looks as if my service is paid entirely by the mercy of others. A professional-turned-beggar :(
Please also allow me to look at its business model from another perspective. GE is one of the most successful corporations in the world (even though it is falling pretty fast due to the transition from manufacturing to financial services). Jack Welch, the one who gave GE a name in the business arena, and the most highly respected management guru used to say: for any single area of business that is not top or next to top in the industry, forget about it.
If you look at the Cyvee website, it looks like an online corporation with various satellite companies servicing different businesses. Unfortunately, none of these is top or second.
Final words
I know the people at Cyvee have a lot of patience to wait for the day they can really achieve something. But asking your customers to be patient is simply not a smart way of doing business. If something is not about to change, they're not gonna achieve anything. Before Cyvee thinks about how to monetize their service in the way that facebook and other web 2.0 start-ups are doing, which is tremendously difficult, they should think about how to make their business sustainable in the long term and start to please their customers. I see more Cyvee people getting together offline.
E-learning 2.0 Platform
I was on a quest for a suitable Vietnamese network suitable for disadvantaged children. Cyvee didn't score.
$2.5USD for a legitimate copy of MS WIndows and Office
Sep 2, 2008Posted by
Anh Hung Nguyen
I was taken aback to learn from Chris, my teammate + roommate during PV08, that Microsoft is giving away its Windows and Office licenses at a dirt cheap price: $2.5USD to people in developing countries. It looked like Microsoft is doing something good.
The team was very happy with the news because we intended to use as much legitimate software as possible in the lab that we were preparing for the next school year the 15 May School. A fairy tale has become reality I guess.
So I started to contact people at Microsoft Vietnam and fortunately they had launched this program in our country. Great! And guess what, the Microsoft people were really nice to me.
However, Microsoft itself said this was not intended as a philanthropic crusade. It is still a business model. And the reason behind this scheme is that people are stuck to MS Windows forever without really realizing that they've beome technology slaves. From an economic perspective, people respond to incentives. Who on earth would not pay $2.5usd to get a legitimate license of Windows and Office, everyone? This is not Africa. And this is a smart move from Microsoft to combat privacy and push Linux away in emerging markets. You deserve my admiration.
The response got from Ms Ngoc Anh, Education Account Manager delivered the following messages:
- We work with the Department of Education only, not you :)
- You have to buy at least 100 licenses. We don't deal in pennies.
What? 100 licenses? We only have 20 computers. And we don't want to make life complicated by asking the Department of Education. Bureaucracy, remember? This is Vietnam!
I then nicely asked if we could buy 100 licenses and give the rest 80 to others. Unfortunately, the request was rejected because it was not a part of their policy.
Even though I am aware that working through the Department of Education is the right way to promote such program, I still have a feeling that this is politically intentional. I think both the Dept of Edu and Microsoft benefits from such a deal. But why don't they make it more flexible. This seems so much to me a deterrent, not an incentive at all.
Windows XP Pro 110$ / 1 PC
Office 2008 65$/ 1 PC
Are you seriously kidding? I'm not going to spend that much for 20 computers.
Microsoft has simply got me frustrated and I'm not gonna tolerate this monopolistic and unethical business model any longer.
Here are two solutions:
- For the 15 May School, I've left everything as is because it was not us who installed pirated versions of Windows onto those machines.
- For our upcoming program, goodbye Microsoft. I highly appreciate your clever trick, but Ubuntu is way better an alternative.
For those of you who still think you can get something decent from Microsoft, forget about it. Take a look at Ubuntu instead.
Tip: If you are working for a school, and find you cannot live without Microsoft, do contact them and pay a small amount of money to get what you want. But I can guarantee you this is not a smart move on your part.
On another side note,for any business model that wishes to be successful, principles are of utmost importance. Look at how Google is moving forward and Microsoft is falling behind. No matter how smart you and how great your techniques are, principles matter.
Labels:
15 may school,
business model,
Economics,
incentives,
Microsoft,
Office,
Project Vietnam 2008,
Ubuntu
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