Chapter 37 Passive supplementary lessons and grand confrontation

In 1999, 26-year-old Chen Tianqiao and his younger brother Chen Danian founded Shanda Network in a three-bedroom, one-living room in the Expert Building of the Academy of Sciences in Pudong New District, Shanghai. They began to operate a community called "Internet Guigu". At the beginning of 2000, Shanda Network received a capital injection of US$3 million from China.com, and the two parties established a new company called Stammer, whose Chinese name is Shi Danmo.Chen Tianqiao owns more than 51% of the company's shares.Soon, Shanda extensively involved in the development and management of online interactive entertainment communities, the development and service of instant messaging software, and online animation and comics.Blind development soon bears bad results, and Shanda Network is in trouble.

Chen Tianqiao began to look for changes, and at this time he entered Chen Tianqiao's field of vision. In order to convince China.com, Chen Tianqiao spent two days preparing a very detailed feasibility plan, and made a very practical analysis of the investment and benefits of the operation. Chen Tianqiao did not persuade CDC, and the final result was a breakup, and CDC left Chen Tianqiao $300,000 in terms of shares. On July 14, 2001, Shanda signed a contract with the overseas copyright holder Actoz (Wemade's partner) at a price of 300,000 US dollars per year. The contract period is 2 years. In addition to the copyright operation fee, 27% of the income must be paid every month as a commission After the contract was signed, Chen Tianqiao had no money, but the game operation had just started, and the server and network bandwidth alone required a lot of money. The situation was very dangerous for Shanda.There was no way, so Chen Tianqiao took the contract signed with the Korean side, approached Inspur and Dell, and told them that he wanted to operate a Korean game and applied for a two-month trial of the machine.When the other party saw that it was an international formal contract, they agreed.Then, Chen Tianqiao found China Telecom in the same way.China Telecom eventually gave Shanda a free two-month bandwidth trial.With the Korean contract and the support of the server manufacturer and China Telecom, Chen Tianqiao won the trust of Shanghai Ubisoft, the leading stand-alone game distributor in China at that time, and sold Shanda game point cards on an agency basis, with a share of 33%.

On September 28, 2001, the public beta began. Two months later, the official fee was charged. The number of simultaneous online users quickly exceeded 400,000.Since then, Shanda has moved towards glory step by step. On March 4, 2003, Shanghai Shanda Network Development Co., Ltd. (Shanda) and Softbank Asia Information Infrastructure Investment Fund (Softbank Asia) jointly held the "Press Conference on the Completion of Strategic Financing by Shanda Network and Softbank Asia" at the Purple Mountain Hotel in Shanghai.In addition to the presence of high-level executives from both parties, it was also an honor to invite Zhou Yupeng, Deputy Mayor of Shanghai, to attend the press conference.Leaders from Shanghai Municipal Information Office, Pudong New Area Government, Foreign Economic and Trade Commission, Zhangjiang High-tech Park Development Company and other competent departments also attended the scene to congratulate. Hong Kong HSBC Bank, as the financial advisor of Shanda Network’s private placement financing, also attended to congratulate Shanda Network on its success. Financing 40 million US dollars.

On May 13, 2004, Shanda was successfully listed on Nasdaq.It was strongly sought after by international investors. In just half an hour, the trading volume exceeded 1.5 million shares. The stock price soared from US$11.30 to US$12.38, and finally closed at US$11.97 with an increase of 8.8%. Concept stocks have the best start in the international capital market. In 2005, Chen Tianqiao spent nearly 2 billion and successfully acquired 19.5% of the stock of China's largest portal network Sina in just 43 days, becoming the largest shareholder of Sina, subverting the pattern of China's Internet.

This year, after becoming the leader of a domestic game company, Shanda began to covet instant messaging.After five years of accumulation and two years of development, the instant messaging tool "Shanda Circle" was formed.The reason for saying this is that Shanda is not much later than Tencent in developing instant messaging software. In 1999, Ma Huateng began to provide free download of OICQ. In 2000, Chen Danian, the younger brother of Chen Tianqiao, approached Hong Bo, the person in charge of China Download (download.com.cn), hoping to include the entertainment software Stame developed by himself in his download list, and Stame has an instant messaging client.

Shanda was associated with instant messaging again in 2004. With the increase of Shanda's own user base and the acquisition of winger, Haofang, starting point, digital red and other businesses, many analysts believe that Shanda needs to launch instant messaging software, which will More and more services and users are connected.At that time, there were rumors that Shanda was negotiating such cooperation with MSN and YAHOO. Chen Tianqiao refuted the rumor that he would not cooperate with an instant messaging service provider that "coincides with Shanda's users" because it would not bring "benefits" to Shanda.At the same time as Chen Tianqiao refuted the rumor, a source said that Shanda was recruiting developers of instant messaging software, and some of the developers of Shanda's instant messaging came from E-phone, which was acquired by 263.At present, Shanda's instant messaging client is similar in size to OICQ, supports full-frequency voice communication in Shanda games, can realize automatic updates, and has interfaces with MSN, Outlook, and Foxmail (similar to the plug-in functions of QQ and MSN, and can support MSN, QQ and other instant messaging software).

Chen Tianqiao has publicly expressed his caution about entering the instant messaging market.In Chen Tianqiao's view, Shanda and Tencent have their own advantages and disadvantages, but their users overlap a lot. Shanda is better off developing new game users for the same users as Tencent.In addition, the competition in the instant messaging market is fiercer than that of online games. Online game users will not stop playing another game just because they have played one game, but in the field of instant messaging, users may not use other games after using one. Although he was quite cautious about entering the field of instant messaging, Chen Tianqiao still took action, as evidenced by the launch of "Quanquan". On July 24, 2004, the activity of "When Shanda 'Quanquan' Meets Online Games" entered the second phase. In the first phase, which lasted 15 days, "a total of more than 7 million players participated". The launch of "Quanquan" caused quite a stir in the industry. "The grand circle will directly threaten Tencent's leisure and game communities, which are precisely one of Tencent's biggest sources of profit. Everyone is targeting young people who are more active and keen to try new things, so the real opponent of QQ is not MSN , but Shanda.” Internet analyst Lu Weigang analyzed.Fang Xingdong, another IT critic and founder of the Internet Lab, also believes that the threat to QQ from the instant messaging software Quanquan, which provides personalized services, exists. "Shanda Circle has a lot of room to use the original user base to provide them with personalized services, and it is easier for these young people to develop value-added services."

"Quanquan" is a product in the instant messaging field that directly competes with QQ.In this competition between Tencent and Shanda, Ma Huateng and Chen Tianqiao, the two Internet upstarts, are both committed to "grabbing each other's territory."If the 20 million gamers registered in Shanda choose to circle, it means that the function of QQ will be excluded.Some players have a good impression of "Quanquan". "When 6 people circle the game together, the atmosphere is like a small family, which is quite warm." Some players who are afraid of trouble also said: "No more games and QQ Switched back and forth."

As for Shanda's "going against the trend" in the field of instant messaging, analyst Liu Shuwen of Analysys International believes that Tencent's use of instant messaging to stimulate the growth of the entertainment and game field is the reason for Shanda's determination to enter the instant messaging market.Zhou Hongyi, the former CEO of Yahoo China, told the media at the time that instant messaging software is extremely important and indispensable to Shanda. "Chen Tianqiao had contacted me a long time ago and wanted to cooperate with Yahoo at first, but later he chose to develop by himself." Zhou Hongyi also said that several major portals are making efforts this year, and the field of instant messaging will definitely reshuffle. Shanda's choice is inevitable.