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Global Times - The 'Key Of Wisdom' Is Out There

Ren Bing hit the jackpot last Monday. By translating just four Chinese characters 敢为人先 into English as "blaze trails with boldness" he successfully beat 3226 other people to win a payment of 3200 yuan ($490).

 

Ren a student at Chongqing University is used to earning rather more modest amounts of money by doing part-time translating work.

 

The portal for his payday was zhubajie.com a "witkey" website based in Southwest China's Chongqing Municipality. Witkey short for "the key of wisdom"
refers to an increasingly popular Web-based system where users can purchase services and information in order to save time and money. The word was created by Liu Feng an MBA student at the Chinese Academy of Sciences in 2005 and founder of Witkey.com.

 

The value of knowledge

Zhubajie.com was established in 2006 and is now China's largest witkey website. It received investment of $10 million earlier this month from International Data Group (IDG) a US-based IT company. The translation task that Ren Bing completed successfully was set by Xiong Xiaoge IDG's global executive vice president and Asia president.

 

By April 23 transactions amounting to 311 million yuan ($47.6 million) had been conducted on the website which now has 4.6 million active users. The website became profitable in March this year and now hosts daily transactions worth an average of 600000 yuan ($91851).

 

"There are successful Internet companies in China but many are imitations of overseas counterparts: Baidu is China's Google and Sohu is China's Yahoo but witkey is China's original business model" said Xiong.

 

According to Zhu Mingyue CEO of zhubajie.com witkey websites mainly rely on commission fees from transactions so the growth of revenue is directly linked to the increase of transaction volumes.

 

"Witkey websites earn money from commissions and advertising with a small part from value-added services" said Yang Ling media and brand manager of zhubajie.com.

 

Zhubajie.com has two basic models. One is a "one-to-many" type in which a task provider pays the website a deposit and then publishes a task and waits for users' suggestions. If a satisfactory solution for the task is selected 80 percent of the deposit goes to the user who has thought it up and the rest 20 percent goes to the website. If no solution is selected the deposit is not refunded but the task provider can ask whichever user has come up with the best idea to refine it slightly. This model is popular for small tasks like designing a logo or naming children or companies.

 

The other model is a one-to-one task. Task providers post their requirements and users introduce their background experience and expected payment for providing a solution. When one of them is selected the payment must be deposited and 1 to 2 percent of the payment goes to the website and the rest to the task receiver.

 

Wang Xiaogang director of operations for Beijing-based k68.com China's first witkey-type website said that k68.com also has two models: "Both require deposits. Task providers pay a 20 percent commission for the one-to-many services while there is no charge for the one-to-one type."

 

In 2006 zhubajie.com hosted its largest transaction. Chongqing's New Open Group offered 300000 yuan ($45926) for help with design of various company logos. Group general manager Du Jixi said "We did that to support this emerging industry. In the process many people proposed enlightening ideas to us."
The iResearch Consulting Group released its analysis of China's witkey industry last November six years after the witkey concept was first proposed.

 

The current picture

 The company said that China had more than 100 witkey websites with over 20 million registered users and total transactions of 300 million yuan ($46 million). Five websites had a transaction volume exceeding 10 million yuan ($1.5 million) and zhubajie.com was in the lead with total transactions of 170 million yuan ($26 million).

 

Popular tasks include posting designing software development and promotion according to iResearch. More than 90 percent of task receivers have regular jobs and only 6 percent can earn 1000 yuan ($153) a month from witkey tasks.

 

However the figures vary among websites. Wang of k68.com said that 30 percent of their task receivers do witkey tasks full time and zhubajie.com's Yang said their full-time task receivers can earn up to 2000 yuan ($306) a month.

 

Look into the future

Wang said that for k68.com the most important thing was "financing to restructure a database for 10 million users." For zhubajie.com and witkey.com which have more extensive funding the priority is business diversification.

 

"The biggest defect of the one-to-many witkey model which is the most popular is that it's a buyer's market. For task providers it's cost effective because they get various ideas from many participants and only have to pay one of them but it's a huge waste of intelligence for the 'losers'" said Liu Feng founder and general manager of witkey.com.

 

Sometimes task providers can pretend to be participants by providing a proposal so as to solve their questions without having to pay so witkey-type websites must explore new ways of development said Liu. 

 

"For example my website has tried out a witkey map a location-based search platform for task receivers and online service providers showing their background and tasks they have performed in the past. The witkey map can also introduce advertising and paid listings" he added.

 

The development of smartphones and social networking services also offer an opportunity for witkey websites. Zhu said the company had developed its Android and iOS mobile phone applications and plans to construct a database of users. The company is also constructing an English website to expand its business internationally.

 

"With a developed payment and credit system witkey websites will explode" said Liu.

 

(Source: http://business.globaltimes.cn/comment/2011-04/649115.html)