Page 155 - How China Is Winning the Tech Race

than 6 million users to a free Web-based instant messaging service for mobile
phones. For about 70 cents a month, PICA customers also can blog, read
news, search, and read electronic books.
Technology aside, there is a whopper of a difference between PingCo and
the rest of the crowd: It’s the only one going up against China Mobile, the
huge cell phone operator with 300
million customers. What would
happen if China Mobile went after
little PingCo? We may find out
“China Mobile doesn’t know if PingCo is a
soon. In June 2007, China Mobile
good thing or a bad thing.”
launched its own free mobile mes-
saging service, Fetion, with a goal Charles Wang,
of attracting 25 million individual CEO, PingCo
accounts. 4
Each time Chinese consumers
buy a service over a mobile phone
in China, the mobile operator takes about a 40 percent cut of revenues from
the content provider. By skirting the Ma Bells of China, PingCo’s free service
takes a slice of revenues and profits from the operator. But PingCo users must
subscribe to the mobile operator’s data service package, which costs about
$2.50 monthly, for text messaging. “China Mobile doesn’t know if PingCo is
a good thing or a bad thing,” says Wang. “And they know they can’t block
us without blocking all China Mobile’s users.”
China Mobile still might unleash an all-out assault on its upstart rival.
“PingCo is pursuing a calculated but risky path,” says Mayfield director
Fong. “What it is doing is not illegal. But China Mobile could put any
company out of business.”

The SMS world is flat

Globally, this free mobile SMS sector is one to watch. A handful of similar
services emerged in early 2006, about half a year after PingCo’s debut. In a
sign that technology trends travel worldwide, the start-ups come from
everywhere: Rebtel Networks in Stockholm, NimBuzz in the Netherlands,
Crickee in Paris, Hotxt in the United Kingdom, and Jajah in Mountain View,
California, and Ra’anana, in a suburb of Tel Aviv.

PingCo—Ping Me, Please 129