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					LIVEJOURNAL:
BLOG PLATFORM, SOCIAL NETWORK, MEDIA

May 8 2008, New Delhi, India
HISTORY: WHAT IS LIVEJOURNAL?




                                2
HISTORY: WHAT IS LIVEJOURNAL?
 Blog platform which allows you to:
     to keep a blog or a diary
     to read other blogs
     to comment and discuss common interests
 Social network which allows you to:
     to find and communicate with friends
     to create themed communities
     to initiate joint social activities
     to develop “cottage industry” e-commerce
 Media platform which allows you to:
     to read news and comments from thousands of authors
     to sign up thousands of regular readers to your blog
     to influence agenda on political, social and cultural issues


                                                                     3
HISTORY: TIMELINE

 March 1999       LiveJournal was started by Brad Fitzpatrick
 October 1999     100 accounts opened
 December 1999    1,000 accounts opened
 December 2000    Communities functionality launched
 April 2001       100,000 accounts opened
 September 2001   330,000 accounts opened, introduction of invitation-
                   only registration
 April 2003       1m accounts opened
 December 2003    Re-opening of free registration
 December 2004    5m accounts opened
 January 2005     LiveJournal sold to SixApart
 April 2006       Plus (ad-eligible) accounts introduced
                   10m accounts opened
 October 2006     Cyrillic audience licensed to SUP
 December 2007    LiveJournal sold to SUP
                                                                          4
HISTORY: LIVEJOURNAL INNOVATIONS

Launched in Web1.0 era it pioneered functionality and concepts that are now
commonplace in Web 2.0 era
     Concept of „friending‟ popularised in LiveJournal
     Feed of latest friends‟ posts
     Community building platform for users
     OpenID as single sign-on




                                                                              5
HISTORY: LIVEJOURNAL‟S SPURT
 Successful viral growth in 2000-2001          K                                         New Accounts a Month, till Nov-03
                                                80
 Early adopters across the globe               70
                                                60
 Invitation-only scheme introduced to          50
stem growth                                     40
                                                30
 Elite / exclusive culture emerges thanks      20
                                                10
to invitation-only registration                  0




                                                                                 Dec-99




                                                                                                                          Dec-00




                                                                                                                                                                   Dec-01




                                                                                                                                                                                                          Dec-02
                                                     Apr-99




                                                                                               Apr-00




                                                                                                                                        Apr-01




                                                                                                                                                                                Apr-02




                                                                                                                                                                                                                       Apr-03
                                                                   Aug-99




                                                                                                             Aug-00




                                                                                                                                                     Aug-01




                                                                                                                                                                                             Aug-02




                                                                                                                                                                                                                                    Aug-03
 Develops strong positions
     Niches (creative communities, fan-        Source: SUP

      fiction, cultural activists, some sub-
                                                K                                                   Total Accounts, till Nov-03
      cultures)                                1 600

     Regions (Russia, Singapore, Israel)      1 400
                                               1 200
                                               1 000
                                                800
                                                600
                                                400
                                                200
                                                     0
                                                                                      Dec-99




                                                                                                                               Dec-00




                                                                                                                                                                       Dec-01




                                                                                                                                                                                                              Dec-02
                                                          Apr-99




                                                                                                    Apr-00




                                                                                                                                            Apr-01




                                                                                                                                                                                    Apr-02




                                                                                                                                                                                                                           Apr-03
                                                                        Aug-99




                                                                                                                 Aug-00




                                                                                                                                                          Aug-01




                                                                                                                                                                                                 Aug-02




                                                                                                                                                                                                                                        Aug-03
                                               Source: SUP

                                                                                                                                                                                                                                             6
HISTORY: LIVEJOURNAL‟S CURVE
 From 2005 – the curve flattens:          M                                                          Total Accounts
                                           16
     Linear growth for number of          14

      new accounts                         12
                                           10

     Number of readers continues           8
                                            6
      to grow                               4
                                            2
                                            0




                                                         Mar-04




                                                                                             Mar-05




                                                                                                                                 Mar-06




                                                                                                                                                                     Mar-07




                                                                                                                                                                                                         Mar-08
                                                Dec-03




                                                                                    Dec-04




                                                                                                                        Dec-05




                                                                                                                                                            Dec-06




                                                                                                                                                                                                Dec-07
                                                                  Jun-04




                                                                                                      Jun-05




                                                                                                                                          Jun-06




                                                                                                                                                                              Jun-07
                                                                           Sep-04




                                                                                                               Sep-05




                                                                                                                                                   Sep-06




                                                                                                                                                                                       Sep-07
 Growth in use inhibited by:
     Rise of new social media sites       Source: SUP


     Lack of focus in online and offline marketing
     Limited introduction of multimedia functionality into LiveJournal
     Technology platform in need of investment and upgrade

 From 2007 – new plans developed:
     SUP acquires LiveJournal
     Investment in technology, people and marketing
     New functionality and strategy introduced
                                                                                                                                                                                                          7
HISTORY: LIVEJOURNAL IN FIGURES

LiveJournal.com worldwide in May 2008:            Monthly Visitors Geo, LiveJournal.com

 15.5m accounts registered                                                 US
                                                   22%
                                                                            Russia
 1.7m active accounts
                                                                  44%       Singapore
                                                 4%
 13.5m new posts a month in 950,000 different                              Canada
                                                 5%
blogs and communities                             5%
                                                                            UK
                                                                            others
 20m unique visitors a month                          21%

 820m page views a month
 Visitors geography:
        48% from US and Canada
        26% from Russia, CIS and Baltics
        5% from Singapore
        4% from UK
        17% from other countries


                                                                                          8
RUSSIAN CASE STUDY: STATE OF MARKET




                                      9
RUSSIA: GROWTH MARKET
                                                                           Internet Users, Russia
                                                    M
Core statistics
                                                    30                                                   27,2
 ~300m Russian-speaking people in Russia           25
                                                                   20,6
                                                                                        23,8

  and abroad                                        20

                                                    15
 27m active Internet users in Russia
                                                    10

 Internet penetration in large and middle cities    5

  45% (60% in Moscow)                                0
                                                                  Weekly               Monthly          6 month
 67% of home audience and 78% of work              Age 12+
                                                    Source: TNS
  audience use broadband access
 29% growth of Internet audience in 2007                                Online Ad Spending, Russia
   (and +25% expected in 2008)                      M
                                                                                                            680
                                                    $700
 90% growth of online ad market in 2007            $600
  (both display and context adverts)                $500                                         430
                                                    $400
 Online ad spending will reach $1b in 2009         $300                         230
                                                    $200
 Four local online media companies have            $100
                                                                   105

  evaluation $0.5-3 bln each – not including SUP        $0
                                                                  2005          2006             2007     2008 F
 6 Russian sites in worldwide Top100 (Alexa)       Source: AKAR, SUP

                                                                                                                  10
RUSSIA: GROWTH SOURCES

The number of Internet users is driven by:
     Consumer boom and growth of PC penetration at home
     Strong demand for PC and Internet from teenagers
     Broadband development with access costs decreasing
     State schemes to promote broadband development in schools, etc.


Online ad market is driven by:
     Increased user activity online as they acquire more experience and receive
      greater incentives to use Internet for information, shopping and social
      networking
     Greater interest from FMCG advertisers in online campaigns as they use
      new media channels which offer wide reach, attractive audiences and
      effective targeting opportunities
     Price inflation for TV advertising campaigns encouraging agencies to
      experiment
     Development of online media metrices
                                                                               11
RUSSIA: GROWTH BARRIERS

Broadband roll-out inhibited outside Moscow
     No attractive flat-rate offer
         $30-50 per month for unlimited 128 kbps / $60-100 for 1 Gb of traffic
         Moscow offers $30 per month unlimited access with 5 Mbps plus
No widespread payment systems
     Regulatory issues
     PayPal has limited functionality in Russia
     No culture for online payments with credit cards
     Micropayments dominated by SMS payments (with 30-50% commission of
      mobile operators)




                                                                                  12
RUSSIA: WHY IS IT DIFFERENT?

Market has little in common with rest of Europe
     Top three sites all homegrown
     Microsoft and Google both invested significantly and not yet broken through
     The reasons are:
         Cyrillic alphabet and complicated morphology creates difficulties for
          localization of international projects
         Highly skilled local programmers create world-class products and
          services for Russian audience
         Russian consumers respond best to localised goods and services




                                                                                  13
RUSSIA: WHY IS IT DIFFERENT?
The market is dominated by local players                                                                                                    Search Engines, Russia

   Search market is led by Yandex (45%).                                                                               others
                                                                                                                                                                        Yandex
    Google (33%) is the only international                                                                               1,4%
                                                                                                                                                                         55,0%
    player in Top 4.                                                                                        Live.com
                                                                                                              1,2%
   Google AdSense is only one of three                                                                                 Search.
                                                                                                                        Mail.ru
    significant players (others are Yandex                                                                               8,9%                                     Google
    Direct and Begun)                                                                                                                                             20,6%
                                                                                                                             Rambler
   Only 2 sites of Russian Top 10 and only 8                                                                                 12,9%

    of Top 25 are international sites                                                                                                                      Source: Liveinternet.ru (Apr'08)




         M                                               Top Sites in Russia, Monthly Reach
        18
        16
        14
        12
        10
         8
         6
         4
         2
         0
                                                                                                  Msn.com



                                                                                                              Icq.com
                                   Rambler.ru




                                                                                                                                 Live.com
             Mail.ru




                                                Google




                                                                Livejournal.com




                                                                                  Wikipedia.org




                                                                                                                                                                     Depositfies.com
                                                                                                                                             Youtube.com
                       Yandex.ru




       Source: Gemius                                                                                                                                                                         14
RUSSIA: WHY IS IT DIFFERENT?
The market is dominated by local players
   Webmail dominated by Mail.ru, no international services in top three
   Photos services dominated by Photo@Mail.ru and Photofile, neither Flickr nor
    Photobucket have significant positions in Russian Internet
   Facebook and MySpace are out of Top 100 in Russian Internet. Their places
    are taken by vKontakte (Facebook clone) and Odnoklassniki (free
    Classmates.com analogue)
   Amazon and eBay are not presented in Russia directly – but their segments
    are already occupied by strong local players


                       Top Mail Services, Russia                                                   Top Photo Hosting Services, Russia
  80%       70%                                                              20%          18%

  60%                                                                        15%

  40%                                                                        10%                       7%      7%
                       27%            26%
                                                                                                                           4%
  20%                                                                            5%                                                3%        3%
                                                 10%                                                                                              2%    2%     1%        1%
                                                                6%
   0%                                                                            0%




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                                  Source: MASMI (% of repondents, Apr'07)                                                         Source: MASMI (% of repondents, Apr'07)
RUSSIA: WHY IS IT DIFFERENT?

Consumers develop strong loyalty with leading services. The market is
significantly influenced by long term preferences
     Services (either local or international) which were once promoted by early
      adopters in late 90s or early 00s have kept market leading positions
         First IM in the world, ICQ, grew in Russia through relationship with
          Russian diaspora in Israel, native country of ICQ. 10 years after ICQ
          acquisition by AOL, ICQ is still the most popular IM in Russia
         The counter-based rating of Rambler‟s Top100, launched in 1997,
          overcame all Yahoo-like catalogues, and is the largest non-search traffic
          generator in Russia. Its dominance has blocked the development of
          catalogues
         LiveJournal was adopted by Russians in early 00s and maintained
          popularity. Its dominance has blocked the development of stand-alone
          blogs.




                                                                                   16
LIVEJOURNAL & SUP




                    17
LIVEJOURNAL & SUP: OPPORTUNITY

In November 2006 LiveJournal in Russia was:
    The leading blogs hosting with 0.7m registered users and 4m unique users
     per month, including many well-known journalists, politicians, writers,
     musicians
    Strong and inspired community with many user-generated activities in
     online and offline, i.e. volunteering in LiveJournal development and
     localization, but these efforts were entirely independent of LiveJournal
    An influential media channel in own right – but not aggregated or extended
     into other media
    A strong media brand in own right – but with nobody supporting its
     development
    One of the most visited sites (in top10) in Russia – but with no metrics, no
     advertising sales and no commercial strategy




                                                                                    18
LIVEJOURNAL & SUP: DEVELOPMENT

 October 2006 –SUP acquires license for LiveJournal in Cyrillic from SixApart
 October 2006 – LJPlus.ru (unofficial LiveJournal satellite services) acquisition
 February 2007 – First display ad campaigns in Russian LiveJournal
 April 2007 - +SOL agency announcement (internal sales agency)
 April 2007 – Launch of LiveJournal mobile version
 May 2007 – LiveJournal.ru launch (news aggregator)
 May 2007 – Media integration with Kommersant.ru
 J une 2007 – 1 million registered users in Cyrillic LiveJournal
 October 2007 – Upgrade to LiveJournal.ru 2.0 with new sections (film, books etc.)
 October 2007 – First offline LiveJournal ad campaign in offline
 December 2007 – LiveJournal.com acquired outright by SUP
 January 2008 – Ukrainian LiveJournal launched with content, sales and
marketing campaign
 February 2008 – LiveJournal Club (discount partnership program) launch
 February 2008 – Community partnership with New York Times launched
 April 2008 – Community partnership with BBC launched                               19
LIVEJOURNAL & SUP: DEVELOPMENT
LiveJournal.ru is an information and
navigation service to assist Russian users
in exploring riches of LiveJournal.com
Currently LiveJournal.ru, as a separate
site, is in Top 200 of Russian Internet by
traffic and reach, with 1m users per month


LiveJournal.ru services includes:
  Reviews of most popular discussions in
   LiveJournal .com
                                                            Unique Visitors a Month, LiveJournal.ru
  Search in Russian LiveJournal.com                M
                                                   1,0
  Ratings of popular Posts, Blogs and             0,8
   Communities of LiveJournal.com                  0,6

                                                   0,4
  Personal statistics for each LiveJournal
                                                   0,2
   account
                                                   0,0

  Classifieds service




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  Offline media integrations with all new media   Source: TNS
   sites                                                                                              20
LIVEJOURNAL AND SUP: STATS

  Key statistics
    9m monthly users
    557,000 regular writers
    Reaches 1/3 of online community in Russia
    Integrated into more than 30 media sites
    1.5m accounts
    83,000 communities
    7,600 paid accounts




                                                 21
LIVEJOURNAL‟S FUTURE




                       22
LIVEJOURNAL‟S FUTURE: DEVELOPMENT

 Existing platform:

     SUP‟s product development team in San Francisco are improving and
      updating the existing functionality and user interface

 Integrations with online media:

     A product specification and diversified rollout strategy is emerging from
      LiveJournal‟s commenting and single-sign-on integration with the bulk of
      Russian online media and recent successful experimentation with the New
      York Times

 Rest of world:

     SUP management team is implementing global development plans,
      focusing on main global language groups

 Enabling localization and specificity:

     As LiveJournal grows around the world, adapting to local conditions, new
      forms will emerge which will be reintegrated into the core platform.
                                                                                 23
LIVEJOURNAL‟S FUTURE: DEVELOPMENT

Strategy outside US and Russia
 Localization:
     New services and content sections, including ratings, content and users
      search, UGC-based online media will be offered at the markets outside
      Russia and US
 Media Integrations:
     LiveJournal will develop media integrations to provide more content to
      LiveJournal users and more interactivity to online media
 Partnerships:
     LiveJournal product, brand and strong community provide good basis for
      local partnerships in marketing, UGC aggregation, B2C and C2C e-
      commerce projects, advertisement
 Flexible Approach:
     LiveJournal can be different or is different in each country. Our goal is to
      maintain this diversity and to offer to each market the product and the
      services it really needs
                                                                                     24
LIVEJOURNAL‟S LESSONS




                        25
LIVEJOURNAL‟S LESSONS
 Development as form of media – where social and traditional media merge

     LiveJournal.ru – typical online media site but relies exclusively on UGC
      which is then filtered by a professional editorial team

     Positioning of LiveJournal as media with 1 mln. authors and 9 mln. readers

 Integrations with other media

     Outsourced commenting functionality is in real demand by online media –
      make it available to them

     Content (news and opinions) exchange between online media and
      bloggers can provide real benefit for all sides (incl. blogs hosting owner)

 Experiments are experiments – they give mixed results

     Mobile services – there is a demand, but not a booming demand. High
      pressure on usability

     Blogs we wrote ourselves – failed to generate any purchase

     Communities we build ourselves – succeeded as commercial and
      marketing project                                                             26
LIVEJOURNAL‟S LESSONS
 Sales

    Strong sale force is the key factor. Start with it from day one

 Community Engagement

    The most complicated sphere which gave us the most valuable lessons

    Cannot communicate too much

    Rumours are spread like wildfire, expectations are high don‟t let people
     down

    Being honest, accurate, patient in communications with users is the
     essential but not sufficient condition

 Global

    There are plenty of opportunities outside US and Western Europe

    Each market is specific and each market can give valuable experience to
     be used in other markets

                                                                                27
LIVEJOURNAL‟S LESSONS: BBC COMMUNITY




                                       28
LIVEJOURNAL‟S LESSONS: BBC NEWS SITE




                                       29
LIVEJOURNAL‟S LESSONS: NEW YORK TIMES
COMMUNITY




                                        30
LIVEJOURNAL‟S LESSONS: NEW YORK TIMES
HOMEPAGE




                                        LiveJournal comments




                                                         31
LIVEJOURNAL‟S LESSONS: KOMMERSANT
INTEGRATION




                                    LiveJournal icon




                                                       32
LIVEJOURNAL‟S LESSONS: KOMMERSANT
INTEGRATIONN




                                    LiveJournal comments




                                                       33
LIVEJOURNAL‟S LESSONS: LIVEJOURNAL.RU




                                        34
LIVEJOURNAL‟S LESSONS: LIVEJOURNAL AQUA




                                          35

				
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