Web Product Innovation in Emerging Markets

Michael “Smitty” SmithShanan Delp

Yahoo!

We’re not Daniel Raffel

Yo

We’re the dudes that convinced Yahoo! that Koprol is awesome

Working Hypothesis

Web innovation is becoming globally decentralized

While Emerging Markets are booming

How Interesting

The Old Way: Valley Web Exporters

Silicon Valley Satellie View, 硅谷卫星地图 by Yan and Yung’s Album

The Old Way

• Global companies launch global products with language sensitivities

• Global companies launch language specific regional products

• Regional companies launch locally (and stay there)

• Global companies excel at scale/monetization but tend to fail at being regionally adored

• Regional adoraton scales poorly

The New Way:Distributed Innovation

Hytle by jdlasica

Why there needs to be a new way

Almost half the 500M internet users coming online in the next 5 years are from emerging markets

Has the old way been blown away?

Platforms allow anyone to scale globally

Regional companies can shoot for the globe

Different customer patterns, but not that different

Origins of Innovation

Younger – first web citizens in family

Social is the killer app

Mobile (will) dominate PC

Follow the Platforms

Platforms (disruptive & unranked)• Hosting

– Cloud (RackSpace,Joyent), Amazon, YQL, AppEngine, MSFT• Federated ID

– FBconnect, yConnect, OpenID, Google• Location

– Maps, checkins, places – part of the platform?• Social

– FB, twitter, diaspora, OpenSocial• Ads

– Display/search moving to – mobile, social, location, network generated• Payment

– FBcredits, PayPal, MOL, Tencent, virtual goods as currency– No true global dominator yet! Platforms

Operating Systems (unranked)

• Web– IE, Mozilla, FF, Safari, Chrome – HTML 5 to rule them all?– Location becomes common place building block

• Vs. Native apps– Native OS: Nokia, Blackberry, Android, iPhone and ???

• PC– Windoze, MacOS, iPad, Netbooks, Chrome and ???– Browser and cloud are the OS of the future

• Don’t forget SMS/Notifications– The ultimate universal OS (see Twitter and Gupshup)

Platforms

The Language Platform

• Is English a common web platform, critical to crossing borders?

• Localization is important? Customers are doing this for some products like Facebook.

• English + local language + crowdsourcing covers your bases– Works to scale system across borders– Local language from customers fills a need for

locally relevant content Platforms

Distribution

• FB / Twitter

Facebook_yoville1 by Narisa

Platforms

Platforms

• Big internet companies exploring emerging markets – not limited to US. Ex: Tencent

• Startups with regional dominance and/or a view to emerging markets growth. Ex: MiG33

• Local VCs today but big VCs with global views could easily take over. Ex: IDG Vietnam

• Emerging markets incubators – Singapore looks like a nice base!

• Internet entrepreneurs with both valley and emerging markets exposure– China $$$ are flowing out of China

Power Brokers

Which countries are innovating?

BRIC

• Brazil – Social! Dominated by local media players, and late to mobile revolution.

• Russia – Money flowing through and out, but tough political environment for outsiders

• India – Huge opportunity. Mobile is key, but mobile web is nascent. Telcos are powerful. English? So far, tough to monetize.

• China – Tough for non locals. Will they export ideas, or just capital?

SEA

• Vietnam – Closed-feeling. Will it open up?• Philippines – on the cusp? Funding environment

needs work. Too focused on outsourcing? Mobile is a huge.

• Indonesia – Mobile is the key. Very open but online monetization still weak but lots of eyeballs

• Malaysia – regional hub? Maybe but not if Singapore has a say. Local market small.

• Thailand – huge potential but technically the backwater of SEA. Not open enough. Strife?

Singapore as a Global Web Hub?

• Yes– Singapore government is engaged– Funding pools have arrived – private & public

• The incubator schemes are attractive

– Infrastructure in spades – pipe, cloud, money, law• Many big internet companies use a Singapore terms of service

throughout the Southeast Asian region

– Hacker community & incubators• Hackerspace, barcamp, seedcamp…

– Good location – nice travel hub• Jus a few hours away from anywhere that matters

– Echelon

Singapore as a Global Web Hub?

• No– Talent pool is small– startups are competing with

the government and global companies– Funding might be too easy & focused on locals• Funding metrics should be associated with milestones

achieved outside of Singapore

– Startups need to start local and go global• Singapore is too small scale wise for EM testing• Singapore is smartphone heavy

Emerging markets will export innovation

Follow the money, and the users crossing borders

Will you need international partners to do this?

Prediction

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Thank you