Internet venture capitals in Japan will go similar way those of consumer electronics companies?

Internet venture capitals in Japan will go similar way those of consumer electronics companies?


Last day, pixiv, who are one of the relatively succeed servieces to obtain its users.
The number of the users in pixiv are now 1.1 million and 830 million PV/month. Despite of its huge users, pixiv confessed its financially unstable status.

The mail sent from pixiv yesterday says, "Pixiv mostly depends on advertisement income and that does not balance our increasing cost. Pixv wants users to use pay service and it will help improving user experiences."


The service of pixiv is classified into as SNS, but pixiv has a unique characterics. Their service is to communicate by illustration. "By illustration" makes their service as a very unique one. Although the uniqueness helped them achieving growing rapidly, when the growing speed becomes saturated, its cons, heavy cost of the infrastracure, gradually hilighted.


The cost of infrastracture is common issue for the internet companies. Other major internet companies in Japan conquered this issue individually. For example, livedor, rakuten, hatena made their infrastractures in their own way.


In Japan, no company have succeed to gain dominant market shares like Google. In this situation brings impressive competition. Most of internet companies in Japan have similar services, like bookmark service, blog service, photo sharing service and so on.


If their serives have the uniqueness, users have benefit from that competitive status. In actual, their services are quitely similar to each other and user cannnot make a decision which one is proper or better.

These no uniqueness servies competition make some companies away from technology race. Cyberagent, who runs a blog serive ameba http://www.ameba.jp/, discards competing technology, takes image starategy. Ameba succeed attracting users to their blog service by hosting blogs for a lot of artists and musicians. They discard competing by the technology.

The starategy of Ameba is right, right way I think, if they do not intend to go overseas.
Their starategy weaken its technological competitiveness. Their starategy is very right from the viewpoint of a campany, but from the view point of the nation. I am afraid such a strategy may deprive the competitiveness from internet companies in Japan.

This situation is similar to the consumer electronics companies in Japan.
As a result of they have been optimized their competiveness only for the domestic, they lose international competitiveness at the moment.

KAIFU Michi, who runs a company in Sillicon valley, pointed out such situation as "paradisiacal isolation". In other words, Galapagos-iated.


Highly optimized strategy for the domestic market is too risky option for the internet companies. In this 20 years, consumer electronics companies lost their internatinal competitiveness because of their inefficient competition in the domestic market. The success of Samsung, LG, Nokia or Google implies times are changing, the period of the isolation have finished already. We cannnot follow in consumer electronics companies footsteps.

In Japan, I think livedoor and rakuten be more agressive to aquire other companies. As a result, it helps emerging company, who has a unique technology like pixiv. Actually, some years ago livedor takes such agressive M&A strategy, but public opinion hostile againt them and livedor gave up to accomplish their strategy for M&A.


As a good news, some venture companies in Japan struggle to provide their service internationally. Major companies, like livedoor, rakuten or Cyberagent looks reluctant to overseas development. Meanwhile, Hatena., inc. http://www.hatena.com/ launched some international services. Hatena has a quite unique serveices and technologically competitive. I hate that hatena provides their service only in Japanese. Some services are actually just a translation or imitation of the international companies, like a UGOMEMO==flipnote or diary==blog service have a uniqueness.


I hope that internet companies in Japan renounce current inefficient competition, take a collaboration strategy or aggressice M&A strategy for overseas development.