On first pass, ChinaBiG faces the same huge expectations and slim chances of any online start-up. Sure, the Hong Kong-based company boasts an impressive 2 million business listings in its Yellow Pages-style directory, and, true, they're bilingual (Chinese and English), offering Chinese businesses access to foreign markets, and vice versa. But ChinaBiG relies on typical Web revenue streams such as advertising and site hosting, and as the 91 online directories that failed in the fourth quarter of 1997 can tell you, these streams aren't flowing like they should.
And yet, for a start-up, ChinaBiG appears to have an advantage even Bill Gates might envy: a monopoly, the blessing of the Chinese government, and its own infrastructure. The venture is one of the first new media companies launched by China Unicom. In the early '90s, a combination of state and private funding led to the creation of Unicom, which the 35-year-old CEO of ChinaBiG, Don Xia, claims has the lead in building the next generation of long distance backbone networks – via fiber optics, microwave, and satellites – that will transmit the Internet telephony, faxes, and wireless communications essential to doing business overseas.
"I don't see many disadvantages to our ties with the government," Xia says. "But the advantages are many." Among them, a shared monopoly with the Ministry of Posts and Telecommunications on the government's business listings, which include the updated phone, fax, and street addresses of all Chinese businesses.
"But how well organized and accurate and rapidly updated is that information? Have you ever dealt with a Chinese bureaucracy?" asks Milton Mueller, author of China in the Information Age, who stresses the "vicious" competition between state-sponsored enterprises like Unicom, the MPT (which claims 98 percent of China's telephone market), and the news agency Xinhua. Says Mueller, "The state connection is as much a curse as it is an advantage."
Xia, however, is optimistic, owing in part to how much he's already accomplished and in part to the potential for growth. Xia first got hands-on experience with the Yellow Pages when he delivered the hefty books in the Los Angeles area, a part-time job during graduate school at USC. He later founded and played primary roles in several Chinese telecom companies. Today, Xia points out, China has more than a billion consumers but less than 10,000 active Web sites. "Unlike in the States, where you have to become very specialized and fast," Xia says. "We see online business as a wide-open opportunity."
