Rebirth 04: Starting from Taking an Unconventional Approach

"You have a point," Ma Huateng said. "But based on my understanding of Xinlang, their style of doing things has always been high-profile and aggressive. Even if they decide to enter the market, they will most likely choose a different approach than us."

"You mean, they won't talk about investment and cooperation like we do, but instead directly invest large sums of money to poach authors, buy copyrights, and establish distribution channels?"

"Well, so what I'm most worried about isn't my heart."

"That's..." Xu Cheng looked at Ma Huateng through the smoke, which veiled the desk, making the midday sunlight streaming in from the window less glaring. "Shengda?"

Ma Huateng nodded, exhaling thick smoke rings from his slightly parted lips, revealing fine wrinkles above his lips.

"Chen Tianjiao's online Disney strategy needs content copyrights as support," he said. "Games are the cash cow, but content is the moat. You know they're planning to acquire Qidian.com, and the valuation has already reached 20 million. If all goes well, it could be finalized within two or three months. The novel copyrights held by Qidian can be adapted into games, films, and animations in the future. This logic is essentially the same as our current attempt to acquire Qingniao."

Xu Cheng slowly rubbed his chin: "Qidian.com gained about 50,000 monthly paying users by doing paid reading on PC, with a monthly revenue of about 300,000 to 400,000 yuan. Chen Tianjiao was actually willing to spend 20 million yuan to buy it, while Qingniao's monthly revenue is far above Qidian's."

"And since they've already set their sights on paid content on PCs," Ma Huateng said, "if they want to replicate this model on mobile, Qingniao is a ready-made target. It has content, authors, conversion models, and user data. Shengda has money, the imagination of the capital market, and the ambition of the content industry. Once they set their sights on Qingniao, they'll offer an irresistible valuation and then incorporate Qingniao into Shengda's content portfolio."

A silence fell between them. Ma Huateng stood up and paced back and forth, his leather shoes making a heavy sigh with each step off the oiled carpet.

Xu Cheng cleared his throat: "Pony, so what's next..."

What are your thoughts?

Xu Cheng had to wet his lips before speaking: "I think we can do two things. First, raise our expected bid. If Qingniao wins the Guangdong Mobile bid, its value will increase significantly. We need to prepare a premium plan internally in advance, which we can bring up directly during negotiations, making Han Fei feel that cooperating with us is more cost-effective than selling to Shengda. Second, we need to create the fait accompli that Tencent is already deeply tied to Qingniao. We don't need to wait for the incubation draft to be fully completed; we can open up a portion of QQ traffic to Qingniao for small-scale testing. This will send a signal to the outside world that Tencent is already cooperating with Qingniao. This will increase the difficulty of Shengda's acquisition and make Han Fei more inclined to choose us. Otherwise, if Shengda enters the market before our incubation draft is finalized, we will be in a passive position."

"You mean taking concrete actions to solidify the relationship, instead of waiting for an agreement?"

"Yes. Han Fei is a sentimental person. If we provide him with support and resources when he needs them most, he will be less likely to switch sides. This is soft power, which is harder to replicate than money."

Ma Huateng returned to his desk, placed his cigarette on the edge of the ashtray, and looked up at Xu Cheng: "You coordinate with the various departments to reassess Qingniao's valuation, taking into account Guangdong Mobile's winning bid, and prepare a higher bid range than we originally planned. Also, prepare a strategic premium, clearly calculating what we'll lose if we ultimately fail to acquire Qingniao and Shengda takes it over. This premium needs to be quantified. As for opening up traffic, even if it's just a small-scale test, opening up QQ's entry point is essentially giving our core assets to an external company. We must clearly understand what we want and what we can afford. You take the lead in drafting a framework, clearly defining how much traffic to allocate, the testing period, how the data will be distributed, and how to proceed. This framework needs to pass my approval before you discuss it with Han Fei."

"Understood," Xu Cheng said. "What about Plan B?"

"Slow down for now. Continue building up the technical reserves, but don't push for launch. As long as we're still in talks with Qingniao, don't send the signal that Tencent wants to do it on its own. But if Shengda or other companies really make a move, then it's not too late to accelerate."

"Okay, I'll get on it as soon as possible."

......

At 5:30 p.m., Mr. Zhou returned from stocking goods in Qingpu, walked into the sales hall, waved to his wife who was watching the store, and signaled her to go home and rest.

Boss Zhou washed his face briefly and noticed that his nose was peeling from the sun, making him look like Rudolph the Red-nosed Reindeer. He took a bottle of beer from the cabinet under the sink, went behind the counter, and sat down in the comfortable wicker chair.

He was exhausted, but felt a great sense of accomplishment. These past few days he had traveled to seven or eight nearby towns. This morning, before dawn, he rode his old motorcycle—which could only be started by gliding downhill—carrying two bundles of magazines to Zhujiajiao. In the afternoon, he went to Liantang, and finally circled around to Qingpu before returning. Each town had two or three newsstands, and one or two familiar faces running phone service centers—connections he had built up over the years in the phone number business.

He lit a cigarette, slowly sipped his beer, and prepared to enjoy a rare moment of leisure. Just then, the phone rang. He cursed and reached for the phone. The moment he saw the caller ID read "Old Fang," a bad feeling washed over him. Old Fang was a newsstand owner in Songjiang, in his fifties. Two days ago, Boss Zhou had just delivered fifty magazines to him.

"Brother Fang, what's wrong?" he asked in a listless voice.

"Zhou the Fatty, your magazine has been sabotaged!"

Boss Zhou sat up straight, almost dropping the phone in his hand.

"What do you mean?"

"Qian Youde's men came this afternoon," Lao Fang said. "They said that only their magazines can be sold in this town, and they threw away all your stock and replaced it with their own magazines. They also said that if I don't listen to them, I can forget about selling anything here in the future."

Who is Qian Youde?

"He's the most capable person in our town. He runs an arcade, does transportation, and lends money—he does it all."

Boss Zhou took a deep drag of his cigarette: "What are the names of the magazines they're displaying?"

"It's called something like 'People's Stories,' the cover is all colorful, with a picture of a woman with big breasts, and it says things like 'A widow at her doorstep,' 'A village bully in trouble.' Let me tell you, that thing is exactly the same as yours, but it's even worse... Anyway, I wouldn't dare sell it! They also left a stack of flyers, saying things like 'nationwide chain, tons of stories, monthly issue.' I think they're just targeting you guys, aren't they?"

Boss Zhou slammed his hand on the counter: "Fine, this is clearly an attempt to cause trouble! Don't touch their stuff yet. I'm coming right away!"