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Mixi hits 8 million January 30, 2007

Posted by fukumimi in Internet, IT, Japan.
2 comments

Mixi, the #1 Japanese social networking site has announced that it has hit 8 million registered users as of January 28th, and is approaching 10 billion page views per month.

Assuming that the users are registering information truthfully (something which is obviously not a given), the age distribution breaksdown as shown below:

Age ~19 ~29 ~39 ~49 50+
PC 9.0% 59.4% 24.6% 5.4% 1.6%
Mobile 15.2% 65.2% 16.3% 2.8% 0.4%

Apparently this translates to one in three people in their early twenties being a registered user (again, assuming that people aren’t lying about their age, and that multiple accounts are not statistically significant. I wonder how realistic those assumptions are)

The PC vs Mobile usage breakdown by gender shows that people registered as female are slightly more likely to access the site via their phones. M/F breakdown – PC 48.2% vs 51.2%, Mobile phones 43.7% vs 56.3%.

So, the younger and more female(?) you are, the more likely you are to access the site via phone rather than PC.

The statistics relating to geographical distribution seem to be using different methodology this time around, as the mobile users now seem to be based exclusively in Japan. I wonder what caused this discrepancy.

Anyway, overseas users apparently account for 4.2% of registered users for PC users.

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On locked vs unlocked phones January 30, 2007

Posted by fukumimi in IT, Japan, Mobile.
4 comments

A rebuttal to Michael Parekh‘s analysis

From the CNET article cited in Michael’s piece:

In Asia, about 80 percent of cell phones are sold independently of a carrier. And in Europe, roughly 70 percent of cell phones are sold unlocked. But in the U.S., between 90 percent and 95 percent of cell phones are sold through a mobile service provider.

Michael’s analysis:

This of course has resulted in a market that offers far greater array of wireless software and services in overseas wireless markets as compared to ours.

The problem with the analysis?

Answer: Japan

In Japan, 99%+ of phones are locked to a carrier. (Nokia has started selling an unlocked phone recently)

Yet, Japan’s wireless services are as advanced as any overseas market. Devices, network speed, sites optimised for mobile phones. By any metric, Japan is a top tier cellular wireless market.

Software (apart from maybe games) for wireless devices isn’t a very big market, but that is due to the fact that most phones have closed operating systems.

The thing is, with an ubiquitous high speed network, the goal is towards web services/SaaS, as touted for the PC in the US. I think the Japanese mobile market is pretty much there already. For example, I only have a basic calendar application on my phone, but I never use it because at work we have a web based calendaring app, which also has optimised mobile phone access. Virtually all mobile internet services are accessible from any of the major carriers.

With 3/3.5G networks covering the whole nation, including all underground stations, I can’t think of many places where I would need wireless service but couldn’t get it, apart from vacations on mountains and ininhabited islands where I would actually rather not being a phone call away from work related stress.

One more thing. Japanese phones have moved from SMS to real email years ago. Isn’t it time everyone else did the same? That would be a real killer app.

I don’t mean to support the strategy of locking phones to carriers, rather I just want to point out that services innovation (at least of the kind which is useful to the masses) and locking phones to carriers are not linked in the way that some people think (or would like people to think).

On the Ministry of Foreign Affairs homepage’s popularity January 29, 2007

Posted by fukumimi in Internet, Japan, Politics.
6 comments

Apparently, according to this Asahi article(in Japanese), Japan’s Ministry of Foreign Affairs is the second most popular government foreign ministry site in the world, after the US State Department site.

The claim is based on statistics provided by Alexa. Of course, no need to go through the same old arguments as to why Alexa rankings are not the most reliable metric, especially in an international context.

The other members of the top 5 list reinforces this suspicion. 3rd is Saudi Arabia, 4th China, 5th France. So it looks like the Japanese page is 2nd most popular amongst English language Internet Explorer users. (I’ve never seen an Alexa toolbar installed on a Japanese PC, ever)

In what I would characterise as misleading journalism, Asahi includes a chart depicting the growth in MoFA site page views alongside the article.

[Labels from right to left are: 9-11,  Koizumi’s visit to the DPRK,  DPRK abductees return to Japan, Chinese SARS outbreak, Outbreak of Iraq War, DPRK missile test, and DPRK nuke test. The labels seem pretty arbitary, as they don’t really all correspond to spikes in pageviews. Note the spike in December 2003 or the one in the summer of 2000 which are left unannotated. I wonder if there is a reason these more prominent spikes were left unmentioned. The 2003 spike is most likely related to the killing in Iraq of a MoFA bureaucrat (who happened to be the subject of rumours relating to a certain member of the Imperial household) and the 2000 spike, although I’m less certain on this one, looks like the Okinawa G7 summit]

Note that it shows a fairly steep positive gradient.

Compare to the Alexa stats for mofa.go.jp.

Which doesn’t show anywhere as much growth. (The Alexa stats show the downturn in the last 16 months much more clearly, too)

I’m guessing that the text was written with the Alexa stats, and the graphic is using pageview data provided by the MoFA.

Hmmm….. Since when have the Asahi and the MoFA become so friendly, anyway?

The piece has a couple of hilarious moments, albeit unintentionally.

The article says that MoFA bureaucrats are baffled as to the reason for the site’s popularity, but there are people who credit the fact that content gets uploaded on to the site quickly, and the site’s ease of use. Yes, I’m sure they are the real reasons. Not.

The article also proudly advertises the fact that an IT PR office was set up in July 2005, bringing in someone from the private sector (from IBM Japan, as it happens) to head up the new unit. This Kamimura-san who heads up the new office says: “Historically, Japanese ministry websites were just about information disclosure”, and the article goes on to say that he worked to strengthen the ability of the web presence to disseminate information and the government message. (fine line between that and propaganda….)

Whilst Alexa is a sub-optimal tool for measuring relative popularity, it is OK for looking at historical trends. It is rather ironic that the downturn in pageviews seems to coincide with the appointment of this IT “expert” to revamp the website……

Having touted the site’s popularity based on the relative rankings vs 109 other nations’ websites as measured by third party statistics, I don’t think the MoFA can turn around and discredit the recent downward trend without making itself look really stupid.

Oh yes, if the graph used in the article is legitimate (if it is, it was most likely provided by the MoFA, because no amount of fiddling with axes will turn the Alexa numbers into that graph), then we have that huge growth in pageviews to explain. My bet is that a substantial portion is due to the cat and mouse game with hackers and the odd DDoS spambot network attack. I’d sure like to see where the access is coming from. Who knows, they may be inflating the numbers themselves to give them a reason to ask for an increased budget to “better serve the taxpayer”….

[PS to Asahi – You really need to think about the use of correct units in your reporting. Pageviews per day/week/month????]

Apa Group and the structural engineering fraud scandal January 26, 2007

Posted by fukumimi in crime, Japan, law, Media, Society.
9 comments

The media started reporting that 2 Apa Group hotels in Kyoto have been shut down by local authorities who have announced that they have found that the two buildings did not comply with building code regulations relating to earthquakeproofing.

I first wrote about Apa’s scandals back in October, and Togo Fujita, the disgraced CEO of eHomes (a private building inspection agency  which had been one of the original whistleblowers in the Aneha/Huser scandal – albeit they were also the ones that rubberstamped the inspections previously) had mentioned that Apa Group buildings were suspect as far back as March 2006 (his comments were not widely broadcast by the media at that time, and most of the media also ignored the issue when it was widely reported around the blogosphere in October when Fujita communicated several statements through the mysterious and widely read Kikko’s Blog).

The news media have ignored the cases reported in October, which related to residential complex developments by the Apa Group in Chiba and Saitama. People who had put down deposits for their new homes complained that they did not recieve adequate communications from Apa, who eventually refunded the deposits. Apa had sent Fujita a letter threatening legal action back in October, which apparently was just bluster as Fujita has not received notice of legal action even three months later.

The question seems to be, why now?

Timing of such disclosures by government related agencies are so often politically motivated so let us consider what the government would like the media to stop reporting about…..

Closing arguments for (ex-)Livedoor’s Horiemon’s criminal case were scheduled for today. Does the government suspect that the criminal case is weak and will not be able to lock him away? (Verdict on March 16th)

I don’t think the Abe government are going to pull out all the stops to protect either Livedoor/Horiemon or the prosecutor’s office. So, moving along….

Abe’s cabinet continues to leak stories of misusing political funds. In the last couple of months, we’ve had Honma (who was shacked up in cushy bureaucrat housing with his mistress), Ibuki (Education minister, who was claiming he spent tens to hundreds of thousands of dollars a year on office rent, although his registered office was in the rent-free diet members’ building. Rent bills do not need a receipt under the lax rules pertaining to politicians’ expenses, and it now appears many people are abusing this by spending the money on non-rent related things (like food) and then just claiming an arbitary amount of rent – politicians’ expenses merits a separate post of its own) , Matsuoka (Agriculture Minister, ditto), and now Kyuma (Defense Minister, whose registered offices appear to be a mahjong parlour and an ex-secretary’s residence). Abe’s popularity is now down below 40%, and a quiet news week would probably have resulted in the Kyuma issue given much exposure in the mainstream press.

Why has it taken so long to uncover these problems? Is it because Apa Group is close to Shinzo Abe?

Perhaps, but I’m guessing the powers who control these things were also sitting on it to use when they needed to deflect attention from some even worse (but less likely to caputre the public’s imagination) news, such as the political scandals. And just think, people like Huser’s Ojima and Apa’s weird dressing female CEO thought they had bought their way into the inner circle of power by supporting (I don’t think it was just vocal support) Abe. I bet they are feeling like right tools now when they realise they have been milked and then dumped to change the subject. Perhaps they should ask for their money back. But then I don’t expect that they got a receipt for their contributions.

Mobile phone meets Nintendo DS January 24, 2007

Posted by fukumimi in Communications, IT, Japan, Mobile.
1 comment so far

As part of the NTT DoCoMo Spring 2007 line-up (sounds like the fashion industry… and in a way, it is), Mitsubishi Electric announced the D800iDS, a two screen clamshell, the lower screen being a touch panel.

Apparently DS stands for “Direct & Smooth”. Conveniently it sounds exactly like this. (DS apparently stands for “dual screen” in Nintendo parlance)

Anyway, the D800iDS is out in February. It is pretty light on features, no integrated FeliCa for credit/debit/e-cash in your mobile phone (must admit I’ve never gotten round to using that feature yet), only a 1.3M pixel camera, no push-to-talk, no GPS, no global roaming, no music player, etc.

The touch screen does offer some potential benefits. The 2.2-inch touchscreen allows handwriting entry as well as traditional text entry via the (now virtual) keypad, and another entry method which takes advantage of a virtual keyboard to allow every Japanese hiragana character to be entered using 2 taps. (Yes, some phones do still offer an option of 2 tap entry on a normal physical keyboard, but most of us have probably forgotten the vaguely cryptic codes we used to type at ease when pagers were all the rage. )

[Historical note – pagers were really big in Japan in the pre-mobile phone era, and virtually all of my high school and university friends had one. Looking back, it is interesting to note that the mobile phone market lagged the European (or at least the UK) market in those early days. I had a cellphone in London before most of my Tokyo based friends got around to getting a mobile phone. Just look how the tables have turned (for the most part) now. I know the US press just loves to point to Europe when it wants to remind readers that it lags in mobile and broadband services, but if they did their homework they’d find East Asia is where it’s at. I guess language is a barrier….]

Anyway, this is where it gets interesting. (Yes, long preamble, blah blah blah, if you’re reading this you already know how tediously verbose I am in writing – compare and contrast to the shy retiring wallflower that I am in person)

Mitsubishi have announced a contest for iAppli (DoCoMo’s J2ME “application sandbox” thingy – ok sandbox maybe rather harsh) developers, to develop something interesting using D800iDS’s dual screen/touchscreen interface.

This certainly seems much more inclusive than the policy taken by Apple recently.

(OK, you give Mitsubishi and DoCoMo distribution rights of the submitted project as well as the right to use it in promotions, but you retain all other intellectual property rights which sounds pretty fair)

Applications close on Feb 7th, by which proposals need to be submitted using this form. People who qualify will be notified on Feb 9th, and will have until March 12th to complete development. You need to have a DoCoMo FOMA account so you can install your SIM card in the DS to test your DS iAppli with. (They’ll give you (to keep) a D800iDS if you get past the first paper exam hurdle.

Prizes on offer: 37V LCD TV for 1st prize (not full HD though, as Mitsubishi haven’t got any in the lineup which must be hurting sales and margins), 3 runners-up prizes are HDD/DVD DVRs, and some DoCoMo credits for worthy mentions.

2006 Japan IPO data digested (Part 2 of 2) January 23, 2007

Posted by fukumimi in Economy & Business, IPO, Japan.
2 comments

So, here are some other statistics regarding the IPO situation last year:

Average gain on IPO price (offer price vs initial trading price) was 77%, down from 133% in 2005. Looking at the main 3 venture markets (Jasdaq, Mothers, Hercules) the average was 97.5% gain (J-60%, M-104%, H-148%).

On average, numbers seem to be becoming a little bit more sensible, compared to the year before.

Maximum gain was 773% (JTEC) and worst performer was KFE Japan which hir 41.6% below the offer price (it listed on Nagoya Centrex, a regional market).

JTEC had sales of JPY2.8B and net earnings of JPY0.18B (about $2M) and at the initial trading price was valued at JPY17.4B, or about $200M.

Other top performers include eBASE, a database software company which went up 543%. Revenues of JPY0.67B, earnings of JPY0.18B, valuation: JPY16.1B

Third was Hikaku.com, the Kakaku.com rip-off that I’ve written about before, up 500%. Revenues JPY0.57B, Earnings JPY0.25B, valuation: JPY84.7B……….

The big IPOs were dominated by old economy stock, led by Nomura Real Estate raising JPY126B and Idemitsu raising JPY109B. Perhaps worthy of note was #7 on that particular list, Accordia Golf, the Goldman Sachs golf course roll-up vehicle, which raised JPY9.8B

Valuation spread (based on initial trading price):

<JPY1B    2

<JPY2B   3

<JPY5B    29

<JPY10B    41

<JPY20B    56

<JPY50B    33

<JPY100B    11

>JPY100B    13

Substantial increase in total <JPY5B valuation companies, from 11 in 2005 to 34 in 2006. Is it an indication that underwriters are keen to push IPOs out early, sensing a possible downturn…?

PER (initial trading price)

<10    2.7%   (2005 – 1.9%)

<20   25.5%   (2005 – 20.1%)

<30    21.8%   (2005 – 14.5%)

<50    19.1%   (2005 – 21.4%)

<100    18.1%   (2005 – 20.1%)

>100    12.8%   (2005 – 22%)

Again, a little bit more sensible numbers, at least compared to the crazy 35 companies hitting PERs >100 in 2005.

However, internet related sectors were still hot, with 15 out of the 24 stocks hitting PER >100 being in this sector. Standouts include Mixi (PER 210, valuation JPY208B), Hikaku.com (PER 567, JPY84.7B), Drecom (PER 572, JPY68.6B), Raccoon (PER 238, JPY29.5B, OKWave (PER 235, JPY13.4B).

For the vast majority of these “hot stocks”, the initial price is was the highest price they posted through the year. Let’s look at their current valuations (and change from the initial trading price).

Mixi –  JPY166B (Down 20% in 4 months)

Hikaku.com – JPY9.4B (Down 89% in 10 months)

Drecom – JPY36.9B (Down 46% in 11 months, down  more than 2/3 from its first week peak price)

Raccoon – JPY3.8B (Down 87% in 9 months)

OKWave –  JPY8.67B (Down 35% in 7 months)

Notable Trends

ICT/internet/mobile sector –  Continued where they left off in 2005 (which saw 77 IPOs) , and had another strong year (a total of 88 out of 188 IPOs belonged to this category – 47% of all IPOs)

Financial Service – We saw IPOs of the first M&A advisory firms (GCA and Japan M&A Center) and equity research firms (Fisco, Japaninvest Group, T&C Holdings)

System Integrators & Software houses – 24 IPOs of SI/software companies in ’06, up from 16 in ’05. Industry specialisation, consulting and new business models are notable trends. Examples are companies claiming expertise in Private Information Protection Law compliance, J-SOX (which is not a single act but an unsightly mishmash of new and updated laws and directives) compliance, nursing care industry specific solutions, amongst others.

In other news,

For people who like faux-British pubs, the company behind the “Hub” chain of British themed pubs also IPO’d last year (April 3rd, on Hercules).  Current valuation is JPY3B, down from more than JPY12B at its peak. (At its peak, it would have had a PER of about 170, which is, well, silly…)

2006 Japan IPO data digested (Part 1 of 2) January 22, 2007

Posted by fukumimi in IPO, Japan.
add a comment

Long overdue post….

No analysis , just raw data. (OK, maybe the odd comment or two as I can’t help myself)

Total Number of IPOs

188

for reference…

2005-160

2004- 175

2003- 121

2002- 124

2001- 169

2000- 203

1999- 107

1998- 86

1997- 142

VC “funded” companies

129 out of 188, 69%. (Of the other 59 companies, 49 were subsidiaries of large corporations or took more than 10 years from founding to IPO)

(2005-64%, 2004-70%, 2003-76%)

IPOs by listing market

JASDAQ 56(30%)

Mothers 41(22%)

Hercules 37(20%)

(Above are the major alternative/emerging/high growth markets)

TSE-1 13(7%)

TSE-2 16(9%)

OSE(Osaka) 3(2%)

NSE(Nagoya) 14(7%)

Others 8(4%)

Industry Sector

Services* 42

ICT* 39

Retail 27

Wholesale 16

Real Estate 16

Machinery 9

Electrical Equipment 6

Other manufacturing 5

Securities/Commodities 5

Food&Beverage 4

Chemical 3

Banking 3

Other financial 2

(Others 11)

*Services/ICT breakdown

SI, Software devlopment/sales 24

Internet Services 20

Human Resources 9

Financial services 5

Mobile related 3

Real Estate services 3

Others 3

Games 2

Medical/healthcare services 2

Wedding/Funeral services 2

Advertising/Promotional services 2

Leasing 1

Industrial waste services   1

Enertainment 1

Magazine publishing   1

Distance Education 1

Vocational Schools    1

Leisure/Sports services   1

Location of company headquarters

Hokkaido/Tohoku 7 (4%)

Kanto(ex-Tokyo) 10 (5%)

Tokyo 105 (56%)

Chubu/Hokuriku 14 (7%)

Kinki(ex-Osaka) 13 (7%)

Osaka 27 (14%)

Chugoku/Shikoku 6 (3%)

Kyushu/Okinawa 6 (3%)

Average time to IPO

across all IPOs 20.9years

JASDAQ average 27.7years

Mothers average 9.4years

Hercules average 12.6years

Shortest Time to IPO (Top 3)

Acrodia 2years 4months

GABA 2years 6months

GCA 2years 7months

Longest Time to IPO (Top3)

Azuma Shipping 88years 3months

Kochi Bank 76years 2months

Aizawa Securities 72years 5months

The other faces of Tokyo January 18, 2007

Posted by fukumimi in Japan, Society.
6 comments

Adamu at Mutant Frog shows us an aerial photograph (courtesy of Google Maps) of Nishinari Park in Osaka, home to a robust community of homeless people in Osaka.

He goes on to say:

The homeless culture is one of the unique aspects of Osaka that gives the city some flavor, and it’s too bad that city officials can’t recognize it as such.

Just to point out that Osaka doesn’t have a monopoly of homeless people, a quick alternative tour of Tokyo:

Fancy living in the middle of a wood which comprises part of 133 acres of parkland in the middle of Tokyo? Within walking distance to both Shinjuku and Shibuya! If you do, this may be for you.

Location: south west corner of Yoyogi Park, between Shibuya and Shinjuku, and just around the corner from some very exclusive residential neighbourhoods in Shibuya Ward. (including the apartment where that 32 year old wife killed her 30 year old husband. She then cut him up and dumped his headless upper torso in Shinjuku, his lower limbs just around the corner from home, and buried his head in a park in Machida, taking his head (I assume in a non-transparent bag of some sort) with her on an Odakyu-line train.

Or perhaps you would prefer a riverside location?

Location: Sumida River, by Kototoi Bridge. In fact, along the whole stretch of the river from Shirahige Bridge-Komagata Bridge-Azuma Bridge-Kototoi Bridge-Sakura Bridge-Umaya Bridge, a distance of about 5km or so, you can see a row of makeshift homes pretty much all the way. (just try scrolling along the river. Many of the blue sheet tents on the east side are obscured by the elevated highway (route 6) running along the east bank)

That is apart from the area around Sakura Bridge, which is a pedestrian bridge built allegedly to connect the two parts of Sumida Parks on each bank – belonging to Sumida Ward (which also seems to have a healthy population of tents on the east) and Taito Ward on the west.

Sakura Bridge apparently cost JPY2.83Billion to build (back in 1985)……

That is about $25M at today’s exchange rates, and a little over $10M at 1985 exchange rates – don’t ask me how much that is in today’s money, but it sure sounds like a lot of money for a pedestrian footbridge to connect two parks, especially when there is another bridge just a few hundred yards downstream and the bridge doesn’t connect to the park on the Sumida Ward side… (perversely, the downstream bridge – Kototoi Bridge, does connect the two parks, and existed a good 60 years before Sakura Bridge was built. Pork Barrel project, anyone?)

Here’s another prime location, with a view of the Shinjuku skyscrapers.

It seems like the homeless have recongregated in Shinjuku Central Park, some of them in plain view from above (though most seem to prefer living under the trees). The population was driven out a few years ago, the rumour was that our great Governor didn’t want to see blue plastic sheeting when he looked down from his nice office in the Tokyo Metropolitan Government Offices (the two square buildings on the bottom right). – The fact the blue tents are back in force would seem to suggest that the rumours that Ishihara doesn’t spend much time in his office these days may be true.

He certainly isn’t known for his sympathetic attitude towards the homeless – he seems to think they are all lazy good-for-nothing bums. It’s alright when you are born with a silver spoon in your mouth, eh. (or in his case, maybe it was somewhere else. You can never quite tell which orifice he decides to speak from on any given occasion)

Mixi releases Mixi Mobile statistics January 18, 2007

Posted by fukumimi in Internet, Japan, Mobile.
3 comments

Mixi, Japan’s largest SNS, has released statistics relating to Mixi Mobile, the mobile interface to Mixi. Mixi upgraded Mixi mobile to offer virtually identical functionality to the PC interface last December.
Mixi sent out a press release saying that on January 15th, the mobile site reached 100 million pageviews/day. There are 2.3million unique users (as of December) accessing Mixi Mobile users, out of a Mixi user base of 6.6Million (this number is of November 2006), and new registrations via Mixi Mobile are coming in at 12,000 registrations/day.

They released some interesting demographics data in the PR.

Male/Female Ratio 43.7%/56.3%

Age of users:

~19               15.2%

20~29          65.2%

30~39         16.3%

40~49         2.8%

50~59        0.4%

Over 60      0.1%

Assuming the ages are accurate (which not a given, not by a long shot…..) No surprise that people in their twenties account for the bulk of users.  The fact that teenagers comprise 15.2% indicates that user adoption is as high for 18 and 19 year olds as for people in their twenties, or people are saying they are 18 or 19 when they are not. There used to be lots of profiles of under 18s on the site, Mixi seems to have clamped down on that to some extent, but there are still users who say they are under 18 in their profiles (although they give their age as 18 in the age field). I suspect there are still a substantial number of under 18s on the site. (as well as older people who are parading as teenagers – as with any SNS, Mixi does have people looking for “relationships” – as well as scam artists and the like)

Current residence of Mixi Mobile users by region:

Hokkaido    3.4%

Tohoku       3.5%

Kanto         50.0%
Shinetsu    1.7%
Hokuriku   1.4%

Tokai         8.8%

Kinki         17.8%

Chugoku   3.6%

Shikoku    1.6%

Kyushu     7.3%

Okinawa   0.7%

That leaves 1% who apparently don’t live in Japan. The PR doesn’t say if the regional data is obtained from the Mixi user profiles, or from mobile carrier data.

Rakuten opens up January 18, 2007

Posted by fukumimi in Internet, IT, Japan.
3 comments

Rakuten, the leading Japanese on-line shopping site, is to open up. (PR in Japanese)

It has launched a beta service of what it calls “Rakuten Web Service”, a set of APIs to access the Rakuten database which currently holds more than 10 million items. To start off, it has made 4 APIs available (shop inventory/auction inventory search API, category search API, product code search API and book inventory search API), and is promising to expand its API offerings to cover its DVD, CD, travel and electrical goods inventory by 2007 according to reports.

Finally, it seems the (mainstream) Japanese internet may be about to embrace a more open model.

The strategy would seem to fit well with Rakuten’s stated plans of going global. It may find it is easier to expand by linking up with local partners who can use the database but may need to provide different logistics and payment mechanisms and the like.