Rebirth 04: Starting from Taking an Unconventional Approach

Chapter 152 Not the Enemy

Zhang Ruiyi shook her head: "But NetEase noticed us so early on, yet they haven't taken any substantial action. I think... Wang Yu's statement that NetEase has significant internal disagreements about whether to enter the content-based SP (Service Provider) market doesn't seem untrue. If NetEase is determined to enter the market, would Wang Yu need to be so humble in front of Lu Hai? They could just poach talent, replicate the platform, and then overwhelm with traffic—wouldn't that be much easier?"

Han Fei sat in his chair, lost in thought. Based on his understanding of NetEase, the company's DNA was more product-driven than content-driven. NetEase could excel in email, portals, and games because these were all based on product logic; the core functions, user experience, and technical architecture could all be standardized.

Content creation has never been NetEase's strong suit, especially non-standard, human-dependent, and long-term-accumulation-dependent content like novels, which is their fatal weakness. They have previously attempted to create original content such as NetEase Blog and NetEase Cloud Reading, but these efforts failed to establish a true competitive advantage.

In 2005, when "Fantasy Westward Journey" became a national-level online game, NetEase almost abandoned the entire SP (Service Provider) sector. At that time, all of NetEase's internal resources, talent, and strategic focus would irreversibly shift towards games. The SP business would be downgraded to a maintenance-type business, no longer receiving any incremental resources. By 2006, due to tightened policy regulations and changes in user habits, the entire SP industry experienced a precipitous decline, and NetEase took the opportunity to completely withdraw from the market.

"Games are so profitable," Han Fei thought. Judging from this, in the original history, the SP business for NetEase was more like a stopgap measure to prolong its life before the game boom; it was a short-term measure to make the financial statements look good, but definitely not the future Ding Lei envisioned.

But can the wings of Qingniao, like a butterfly's wings, flap and change the course of NetEase, this behemoth? Will the emergence of Qingniao Reading change Ding Lei's thinking, shift NetEase's strategic focus, and ultimately alter NetEase's fate?

If nothing changes, then NetEase's current ambiguous attitude towards the SP content sector can only last for a year at most. By the second half of next year, the huge profits from the game business will make Ding Lei cut all non-core investments without hesitation.

What if Ding Lei's strategic resolve changes because of the emergence of Qingniao Reading? Then Wangyi might suffer a crushing defeat. No, they definitely will suffer a crushing defeat.

Han Fei shook his head. No way. It's highly unlikely that Wangyi will change because of Qingniao; at least, it won't go all out and recklessly compete in the SP track.

Qingniao Reading's current monthly revenue is already top-tier in the SP (Service Provider) field, but it's nowhere near the scale of the revenue generated by games like "Westward Journey 2" and "Fantasy Westward Journey." Ding Lei is a top-tier corporate strategist; he values ​​structural opportunities rather than short-term gains or losses.

The size, profit margin, lifecycle, and user stickiness of the game market far surpass those of the SP (Service Provider) content sector. Ding Lei should be thinking about how to use *Fantasy Westward Journey* to compete with Shengda's *Legend of Mir* and build NetEase's game empire. The success of Qingniao (a game platform) at most made him think that content-based SPs were a decent infantry force, but for him, games were the air force and armored divisions.

The only possible variable is that Qingniao has prematurely demonstrated the rudiments of a complete IP industry chain. For example, one of Qingniao's hit novels might be adapted into a comic or radio drama, or even discussed as a low-budget film or game. Only then might Ding Lei truly be shaken.

Therefore, it's not necessarily true that everything Wang Yu said to Lu Hai was entirely insincere.

"Han Fei. Han Fei!" Zhang Ruiyi shouted, patting Han Fei's arm.

Han Fei twitched in his chair, as if he had just woken up from a dream. "Huh? What's wrong?"

"Say something! What are you thinking about?"

"More or less," Han Fei said, pulling a pack of cigarettes from his pocket.

"What are you talking about?"

"Uh, I heard everything you said, and I think your analysis is pretty accurate."

"Yeah?"

Han Fei sensed the probing gazes of Zhang Ruiyi and Wen Jie.

"Hmm," Han Fei said, waving an unlit cigarette in his mouth. "Wangyi is betting everything on games right now, that's an open secret. The SP business is a saturated market for Wangyi, not a growth market. The growth rate of their SMS business is declining. Wang Yu's transfer to the strategic development department was probably Ding Lei's arrangement, to remove her from the product line and focus on keeping an eye on the trends in new sectors and building strategic reserves, rather than having her lead a team into the fray."

Zhang Ruiyi pouted her lower lip: "If that's the case, then what she said to Lu Hai about not being able to catch up in the short term and not wanting to force it was the truth? Because Wangyi's current strategic focus isn't on that at all?"

"right."

"But she still came," Wen Jie said stubbornly. "If Wang Yi didn't want to fight, why would she look for Lu Haiqian?"

"That's where their cleverness lies," Han Fei said, lighting a cigarette. "When NetEase transferred Wang Yu to the Strategic Development Department, it didn't mean they gave up on this track. On the contrary, they're staying at the table in another way—not playing, but observing and accumulating experience, building relationships, so that when they want to enter the game, it will all fall into place naturally."

"What about when she said we're not enemies?" Wen Jie asked.

"This statement can be interpreted as meaning that they will not take the initiative to become enemies with us at present. Because they need time to see if this track is worthwhile, and they also need time to reach an internal consensus. Until they see these things clearly, maintaining a friendly relationship with us is far more cost-effective than going to war with us."

Wen Jie stretched out his hands and scratched his buzz cut: "You mean, Wang Yu doesn't mean us any harm, but she's not benevolent either; she's just playing a long game?"

That's roughly the idea.

Zhang Ruiyi looked at Han Fei: "Should we take her bait? If they really hold some kind of industry salon, are you going?"

"We'll see. If we can go, we will. After all, an invitation from NetEase is a kind of certification for Qingniao, and we can also take this opportunity to find out more about them. But if there's a time conflict, and they've chosen their Guangzhou headquarters as the location, then we'll have to send Lu Hai," Han Fei said, taking a drag of his cigarette. "We just need to keep an eye on NetEase's situation. Dealing with them is a slow game, while dealing with Tencent is a fast game. We can't let NetEase distract us. What's the progress on Wen Jie's one-line submission filtering system?"

"The core functionality is already in place," Wen Jie said. "The entire process can now run smoothly, and we are still doing final testing and optimization."

"Come on, let's go to my office, I'll show you."