Metcalfe's law in Sun Liang's eyes

Source:NetEase News  Date:2017-12-28

At the beginning of Feb. this year, 80 students of CEIBS EMBA 2016 Class made business tour to TCL Corporation, learning about the internet transformation layout and smart manufacturing progress of TCL Corporation. Jedi Sun, who is the Vice President of TCL Corporation, President of TCL Internet Business Group and CEO of Hawk Internet, was invited to deliver a report with the theme of "Embracing the Great Voyage of Global Mobile Internet " to the students.x

Based on the background and requirements of the CEIBS EMBA students, Sun’s report was divided into 4 parts——"The Ways of Internet Development", "Global Market Insight and TCL Strategic Layout", " Development Strategy of Hawk " and "Introduction of the Sub-Business of TCL Internet Business Group ", covering the analysis of the Internet industry, strategy thoughts, layout of business development and so on. Considering some of the students were not familiar with Internet industry, Sun, an “OLD SOLDIER” of this area, firstly shared some common sense with the students. The prime knowledge covered with 20 Analyses Towards 9 Thinking Ways of the Internet, The Characteristics of High and Low Frequency Demand, The Start point of Industry Strategy, The Essence of O2O ——Industrial upgrading. Besides, Sun pointed out: Creation and Preservation are the Foundation of Internet Company. The Internet Company has an Ambition of Seizing the Entry of Hardware. User Retention is the only standard of a Good Internet Product. At the end of the first part, Sun also shared his experience and lessons which he has learned to face the risks and challenges behind the Internet industry. The second part of the report is the introduction of TCL business. Firstly, Sun analyzed each segment market capacity of the global Internet ecological value. According to the data of GSMA: the global Internet value chain can be divided into five layers, “user interaction layer”, “connection layer”, “support and service layer”, “online service layer” and “copyright layer” based on user’s insight. In the future 5 years, the global Internet market volume will be expected to reach $ 5.85 trillion, of which 52% are "online services" (e-commerce, social, games, app distribution, cloud services, etc.), 22% are Interactive layer (smart phone, PC, smart TV, other smart hardware, operating system and security software). TCL realized these two huge markets, thus the "Double -Wheels Drive" Strategy ("double +" and internationalization) was launched in 2014, whose key industry and transformation business is exactly its largest and the fastest-growing market. Then, with the help of "TAIC Model of Enterprise Internet Ecological Value Analysis", Sun introduced the business structure of TCL and the blueprint he painted for the Internet transformation including smart hardware platform, application platform, content platform, user asset management platform, monetization system and cloud platform, etc.. After that, he focused on the composition of the Internet business, including 4 major business groups (Mobile Internet Business Group, Home Internet Business Group, Smart Home Business Group, Online Education Business Group) and 7 independent subsidiaries. Finally he referred to two main bodies of TCL mobile Internet oversea business, that is, Hawk Internet and TCL Communications MIBC. The share in this part which includes both model analysis and layout blueprint, Sun showed his great global vision well. All of the students spoke highly of it.

In the third part of the speech, Sun talked about Hawk Internet's breakthrough direction, development path, product principals, product ecosystem construction as well as the promotion and the commercial monetization respectively. Firstly, Sun analyzed the opportunity and challenge for TCL mobile Internet development. He believed that with the improvement of operator network bandwidth and the increasing popularity of smart phone, there will be a huge growth of global smartphone users. It is expected that from 2016 to 2020, there are still 2 billion incremental spaces. Global smart phone users will scale up to 5.8 billion in 5 years. These volume will come from India, Indonesia, Mexico, Brazil, Russia and other rising countries. Compared to the slowdown growth and the fierce competition in domestic market, overseas mobile Internet still has huge potential opportunity; Hawk Internet must proactively seize the opportunity. Based on such a market judgment, Sun put forward with “Three-Stage Rocket Strategy” for the development of Hawk Internet products and acquisition method of overseas users. According to the Metcalfe's law (Metcalfe's law states that the value of a telecommunications network is proportional to the square of the number of connected users of the system (n2).), he especially shared how to define the value of an Internet product according to the numbers of users, the frequency and time on application. Under the guidance of this principle, Sun has made complete product ecological chain for Hawk Internet, which includes mobile security products controlling the ecological chain; tools and contents products controlling the landing page of phone; advertisement, games, application distributions products controlling the commercial monetization. There are also big data products supporting the operation and the mobile phone operation system. In order to help students understand the relationship clearly, Sun also demonstrated with some cartoon characters. Since promotion and commercial monetization are necessary when the layout of products is finished. Sun finally introduced the strategy of promotion and how Hawk would pace itself for commercial monetization. The advertisement, games and e-commerce will be the main income from overseas. In the last part of the report, Sun briefly introduced the subsidiary business of TCL Internet Business Group, such as Digital Entertainment, GOLIVE, Cloud Platform, Smart Home, Fun network, etc. to let CEIBS students intuitively understand TCL Internet transformation. Till then, the share came to the end. The entire report and cases fully reflected Sun’s global vision and strategic mind. CEIBS students were also highly appreciated of Sun Liang's share. They expect more follow-up interaction with Sun through social media like wechat and weibo. A thank-you memento was sent to Sun by the students to show their gratitude.

CEIBS is business school founded by China and the European Union in 1994. It is committed to cultivate business leaders with an international perspective and actively taking social responsibility. It has now become Asia's leading and world-class business school. It is reported that the CEIBS EMBA2016 students are mostly from the chairmen, CEO or business executives of enterprises. They are looking forward to learning the valuable experience of Internet transformation through visiting the excellent business groups and communicating with the leading Internet figures. This TCL Internet trip is impressive and worthwhile to everyone!

More News