Take note, China

Updated: 2012-06-08 10:24

By Ariel Tung, Lin Jing and Su Zhou (China Daily)

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Take note, China 

Phil Libin says launching the stand-alone service, Yinxiang Biji, is part of Evernote's long-term strategy in China. Provided to China Daily

Evernote's new stand-alone service is expanding with the help of faster connectivity

Evernote, the company that develops web software to help people take daily notes, is striving to work with Internet and technology companies in China on its recently launched service, called Yinxiang Biji.

Claiming to be "the company that's helping the world remember everything", the California-based company launched the China-exclusive Yinxiang Biji ("memory notes" in Mandarin) on May 9.

The Chinese service will be "faster, more reliable and better integrated with the rest of the Chinese Internet", according to the company. It will allow local developers to build applications and payment methods that match Chinese Internet expectations. Yinxiang Biji will also provide Chinese-language customer support based in China.

The existing Evernote service will reportedly not be affected and will continue to run separately, according to the company.

China has taken over the United States and Japan to become the fastest growing market for Evernote since Yinxiang Biji's launch, which is not surprising since China is the world's largest Internet market with 513 million users last year. The note-taking web service has more than a million users in China with the number increasing by at least 12,000 daily, says Evernote's CEO Phil Libin. The company has 32 million users worldwide.

In a blog post, Libin explained the reason why Evernote spun off the stand-alone version.

"The most common request we get from our Chinese users is to make Evernote faster, more reliable and better integrated with the rest of the Chinese Internet. Due to poor network connectivity between the US and China, there's only one way to definitively fix the problem: have a separate service in China."

To help its expansion in Asia and other regions, Evernote received a $70 million investment in May from a group of investors led by Meritech Capital and CBC Capital, a China-based private equity firm. Evernote says it is currently in discussions with Chinese corporations "to deepen our connections with the Chinese Internet and local technology companies to build products for the world, not just for China".

"There are many great Chinese companies who have a global outlook, and these are the ones we want to work with," Libin says. "We are inspired by CBC. We know it's not going to be easy. We know we don't understand everything, but we need to have a right attitude. We have to be in China for the long term."

CBC Capital, Libin says, is Evernote's main adviser in China.

While Google has had little success in China, and Facebook has not launched a new service in China, Libin thinks Evernote will be different.

"We work with the legal team in China to make sure we are in compliance with the local operations. We have fewer issues than those companies because we are not a social platform. Evernote is not about communicating or expressing anything. It's a private activity," he says.

Evernote faces a number of local competitors in China. Local apps have so far provided free usage of up to 1GB of storage space for users. Some have designed special features for Chinese users.

Youdao Yunbiji, an Evernote-style application developed by Netease in June 2011, claims to have 3 million users as of June. The app supports handwritten notes and allows 1 GB of cloud storage.

Mknote by Shanda Interactive Entertainment Ltd, an IT company in Shanghai, gives 500 MB of free storage for first-time users. They can have another 200 MB of storage by successfully inviting another user.

Libin says he is not worried about local competitors like Youdao and Shanda.

"I think we have a very different approach to doing things, so it will be tough for someone to beat us. We only worry about somebody being more innovative," he says.

The company has secured partnerships with a few local IT companies in China. Right after its May 9 launch, Evernote worked with UC browser, a leading Chinese mobile Internet site that has 200 million users worldwide, to embed its software. Qplus, the open platform of Tencent with more than 100 million users and 80,000 apps, is also reportedly cooperating with Evernote.

Users of Yinxiang Biji currently can have a free account with limited monthly usage. The company will soon launch a premium pay service for more cloud space. Libin says the company hasn't finalized the price yet. Similarly, Evernote offers both free and premium accounts.

Yan Huawen, an analyst with iResearch, a Beijing-based consultancy, says that Evernote may have a stable flow of income by providing both free and premium services, but that the limited usage of 60 MBfor free users per month  may hinder growth in the beginning. Evernote, Yan says, must also take note of the habits of Chinese users.

"Evernote allows users to take notes more conveniently, but Chinese users prefer to use online storage websites for document saving and sharing. It is a different concept," Yan says.

She says that online storage websites such as 115file.com and DBank already have a large following. Users can download and upload documents, including movies, on these sharing sites. Data from iResearch shows that by March 2012, online file-storage sites registered 86 million users.

"To win more Chinese users, Evernote has to make some adjustments to its core functions," says Yan, who did not specify what changes Evernote should undertake.

Yinxiang Biji's Beijing office currently has eight employees. It is expected to hire hundreds more, for customer service support, design and development, in the next few years.

Although China is forecast by research company eMarketer to become the second-largest market for online ad spending in the world, Yinxiang Biji users do not have to worry about the company selling or sharing their data with any partners or advertisers, according to Evernote's bylaws.

"We are not investing in China just to sell stuff to the Chinese people. We are thinking of making products for our partners and developers. The goal is to introduce great products to the world," Libin says.

For now, he has no concrete plans for Yinxiang Biji in the next few years, because "China has a very quick changing environment".

"The main thing is we don't really know. There are so much changes and uncertainties. So we can't have a very rigid plan."

Contact the writers through atung@chinadailyusa.com

(China Daily 06/08/2012 page16)