Can a geek-driven video portal beat YouTube in Japan?
One of the most spectacular success stories in the Asian web market is currently being written by Nico Nico Douga (”smiling videos”), a video sharing platform from Japan. As one of the country’s most visited sites, it still trails the Japanese version of YouTube. But Nico Nico is catching up very quickly.
The site, which is available only in Japanese and requires registration to view videos, managed to attract nearly 6 million registered users since its launch in January 2007. The number of users of the mobile version exceeded the 1.2 million mark in March this year. Nico Nico racks up around two billion page views per month. The site is estimated to carry one twelfth of Internet traffic in Japan. Google Trends for Websites doesn’t break out YouTube properties, but it does show Nico Nico to be attracting about as many visitors as Veoh does worldwide (about 1.4 million on a daily basis, see chart below).
Unique characteristics
Nico Nico’s most distinctive feature is that members communicate via short texts inserted on top of the video feeds. Entries are time-synched and flow over the frame from right to left. Using different colors, other users can add comments later in the same way. Some videos are virtually covered with thousands of lines of text, which can be filtered or turned off.
This feature sounds totally absurd but is the main reason why users spend twice as much time on Nico Nico as they do on Youtube. Until today, over 1.2 billion comments were added to the 1.1 million videos on the site, up from 600 million in November 2007. The content mainly consists of Nico Nico-”exclusive” material such as video-game sequences, bizarre comedy clips, anime and user-made footage.
Embedding Nico Nico content is restricted, but this Youtube video serves as a good example of what is typically being contributed:
An additional advantage Nico Nico has over the American archetype must be seen in its strong Japanese identity. The site is deeply rooted in this country’s geek culture, which is reflected in the Manga-inspired design and wild layout.
Moreover, there is no restriction regarding the length of videos, which are usually higher in picture quality. And, in contrast to Youtube, Nico Nico welcomes uploading of erotic content in its so-called R-18 section.
Three-pillar business model
Niwango, the company operating Nico Nico, is one of 15 subsidiaries of Dwango, a media group listed on the Tokyo Stock Exchange.
Nico Nico generates revenue in three different ways. There are currently 200,000 Premium members (up from 90,000 in November 2007) who pay $5 per month for easier access to the site and additional functions. Niwango also sells ad space, accounting for around $300,000 monthly. Sales from affiliate links generate approximately $820,000 per month (official figures for February 2008). That adds up to $2.1 million a month, or a $25 million annualized revenue run-rate.
But maturing as a company, Niwango faces some serious hurdles looking ahead. Nico Nico burns close to $1 million monthly due to high server expenses, with overall costs rising faster than revenues.
The company is currently trying to get in the black. In May, it partnered up with Yahoo! Shopping to expand its affiliate business. Nico Nico videos also prominently appear in the Yahoo! Japan search index now. This is a promising move: Yahoo! Japan is this country’s biggest web company.
However, the mobile version of Nico Nico is still completely free of ads. Niwango also has to deal with a number of copyright infringement problems.
In terms of scaling, the biggest challenge will be to find ways to open Nico Nico for the Japanese mainstream user. Most of the current members are male Otaku, anime and video game freaks with a high level of tech literacy.
International versions could spur growth as well: The site’s popularity already spawned a Chinese copycat. An official version for users living in Taiwan was launched as early as October 2007.
While the concept might not translate to the U.S., the ability to comment directly on videos with text is a feature that could catch on elsewhere.
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I fail to see how commenting directly on the video is better. It’s a distraction in my mind. Not only that with normal textual comments, we can navigate through them easily and reply directly to a comment. The social aspect is definitely more in text based comments.
I like their logo! Very homebrew.
It always intrigues me how Japanese (and Chinese and Korean, it seems) sites tend to look like the ICQ homepage (or any other portal) circa 1998.. incredibly overcrowded, unsubtle color palettes, clunky controls. I sometimes have to wonder whether they’ve got it right and us, with our new delicate “Web 2.0″ designs have it all wrong about what the user needs (rather than wants).
Sounds a little like iminlikewithyou.com over here in the States. They do they whole “word bubbles over video / picture” thing and have a pretty awesome collection of vids. Kinda turned out to be just a fad thus far, no real traction.
@ Peter Cooper
“I sometimes have to wonder whether they’ve got it right and us, with our new delicate “Web 2.0″ designs have it all wrong about what the user needs (rather than wants).”
Touche.
This actually works a lot better and is a lot more adictive than you can imagine without using it and being able to read it… I did a guide to making an account to browse the videos earlier this year for anyone interested.
http://mikesheetal.com/en/2008.....ico-douga/
Youtube has got those annotations overlayed onto the video and they are a distraction too.
That can easily be reproduced for the English language in Flex 3. I don’t think it would be popular though. It wouldn’t take more than an hour to build a player like that with dynamic text overlays.
Indeed, it probably wouldn’t work as well with the English language because it takes more space, compared to CJK’s pictographic character sets, to represent one word. Ironically it’s less distracting since you can absorb the visual information faster (higher information density per pixel) than if there was English text scroll across.
it probably wouldn’t work
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“Indeed, it probably wouldn’t work as well with the English language because it takes more space”
I don’t think that’s the issue. I dunno if you visit a lot of forums, but there is often times threads titled “caption this picture” or “photoshop this picture” in which you are supposed either caption the picture in a madlibs type way or photoshop it to make it look stupid.
The point being that Americans, unlike asian people do not like automated services which do that sort of thing. They like to roll out photoshop and actually do it themselves. Same goes for youtube. They like to edit with final cut or premier themselves.
In Korea, they have booths where you can take pics of yourself and draw dumb designs on it via a touch screen before you print the photos out. That is really popular over there. Here people would think it’s dumb or geh.
In Japan, businessmen can buy teen girls soiled and used panties out of vending machines. Here that would be associated with total perversion. There it’s normal.
So we have a cultural gap with Asia that simply can not be bridged. The technology is only the presentation layer of that gap.
>In Japan, businessmen can buy teen girls soiled and used panties out of vending machines.
That’s so untrue. Where did you get that information?
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Yet another disaster this business model is sure to fail and will die http://www.crunchnow.com
I’ve played with NicoDo and it’s a funny concept but when you start looking at the video content you realise a few problems… such as the fact that it seems mainly male oriented (in Japan, like the rest of the world, over half the Internet users are women), and you also soon realize that it’s largely quite mean-spirited and snarky. I think these two things alone may limit its growth even in Japan, but it would be interesting to be proven wrong.
http://www.techxiety.com .. shows a solid comparison of Nicovideo vs other Web 2.0 Video Sites… more like UCG Video 2.0 Asia vs Rest Of The World.
Because I’ve done it so often, I mangaged to get a profile without knowing Japanese. I am right now trying to figure out how to upload my video, and there’s so much text that it’s difficult. I am using Dictionary.com translator and it’s helping. The translations are pretty funny - everything seems to have ‘happy’ in it. It also seems to be more complex to upload if you’re not a premium member.
Well, just to add a few more things.
I don’t really think those of you living in the west really appreciate how different the internet environment is in Japan and Korea. a 100meg connection is only $30 a month in Japan. A 60gig connection is only $70 a month. The crappy 1-6meg connections available in the states at outragous prices just don’t compare.
http://bbpromo.yahoo.co.jp/hik.....index.html
On top of that there are the cultural differences. The facebook of Japan is called Mixi (http://mixi.jp). You can see one big cultural difference very quickly, Japanese generally never post pictures of themsevles and none of their profile pictures are pictures of themsevles. The point is, the culture is very different and what works for them may not work for you.
Video with overlay is the norm, watch any non-drama Japanese TV show and it’s got overlays all over it. From subtitles which are not provided for the deaf but are there because of culture to the overlays of celebraty reactions, it’s just different.
About time TechCrunch reported on this site instead of endless and worthless posts about Facebook and Yahoo.
What some of the commenters here are missing is that Nico Nico Douga is like watching a video with a bunch of friends, with people commenting on what’s happening as it happens.
Can it be that your server is infected with a virus - I get an Virus warning when I open your site with Firefox - Just for your Info.
The core concept of Nico Nico is this “mass pseudo-simultaneous participation via time shifting of comments “. It’s not the same as a long endless lines of comments at the bottom of the video. The comments make some of the videos even funnier. Just think Mystery Science Theatre. I think there’s a lot to be learned here, and I am amazed how people are quick to judge….
> Chris
>In Japan, businessmen can buy teen girls soiled and used panties out of vending machines. Here that would be associated with total perversion. There it’s normal.
What age are you from!!??? It is NOT normal and never was. And those vending machines haven’t existed in a decade now…. I’ve been here for longer than that and I actually have never seen it…(it was out there somewhere, I’m sure…) Funny how people believe the media. Intelligence and common sense are the only things that allows you filter out this kind of garbage.
I suppose what should be noted is: if there’s a feature available to the users, and the users choose to use it (comments overlayed on video), then perhaps what we claim to dislike might be a bit removed from what’s actually happening.
Someone’s using it. Go fig.
The reason this site is popular is because it can be access from the keitai, not because Japanese people have fast internet connections. Youtube, generally, is not accessible on mobile phones here in Japan, and mobile phones are the predominant way people connect to the internet. Plus they have porn.
One interesting thing they did is that premium users get additional options for posting text, such as larger font sizes and more colors (I think). I thought that was a fascinating way to differentiate free and paid users.
Just a correction: the site does NOT allow porn/nudity. The R-18 “section” is really just a sanctioned tag (like the other sections) that allows suggestive/”almost” erotic content. It’s actually filled with a combination of cut-scenes from so-called dating games and joke videos (”tsuri”) which try to trick the user into thinking they get to see some nudity/action, before quickly cutting to something completely different.
If you read their terms of usage (http://www.nicovideo.jp/static/rule.html ) you’d find that they clearly state that pornography is not permitted. The R-18 tag itself is explained on their officially endorsed wiki/encyclopedia site:
http://dic.nicovideo.jp/a/R-18
Basically, the level of censorship will be about the same as Japanese TV (i.e. no porn), and it is only a restricted tag so as to allow users to add affiliate links to products that are only sold to those over 18 years of age.
Also, the site has growing popularity on mobile phones, but this is NOT the reason is popular. If you look at their timeline, you’ll notice that they launched the mobile site AFTER it became popular.
The popularity is generally attributed to how the comments (which are actually highly tuned) add to the experience of watching videos on the site. Most users find that videos without comments feel “lonely”. The purpose of commenting is not for debate or “intelligent” discussion — instead, its closer to the chatter of a crowd watching a sports match.
Also, although there is no limit on the length of the videos on the site, the total size of the video is limited. You can get longer videos by dropping the quality, however, there are limits.
Dwango have extra cash enough to maintain nico douga, so nico video can live for another one or two years.
but if thinking of living for five years or more, it would be difficult.
probably google and another video-sharing website have same problem.
one of the reason nicovideo can succeed is just they can get many otaku users. In 2006,Japanese internet user enjoyed youtube. niwango add chat function to youtube. japanese user just choosen more functional website.
nicovideo have many other function using flash. Thinking a flash game, youtube also can add flash function on its website.
nicovideo is very community-oriented website
one example is, there are many “nico nico douga theme song” in nicovideo.
I searched “youtube theme song”, but can find only one song.
It’s like Digg or 4chan comments shown in CCs. Nothing to be excited about.
If you are interested in academic research about Nico Nico Douga, check out this research blog (in English):
http://d.hatena.ne.jp/metagold/
The research is ethnography-ish, and based on interviews and conversations with Japanese programmers, bloggers, producers, researchers, critics, theorists and, most importantly, Nico Chuus (=Nico Nico Douga junkies). You can find here also more embedded videos with comments.
It is conducted by the Metadata Project, Centre for Cultural Studies, Goldsmiths College, London (sorry for the shameless self-promotion).
Hi,
Video sharing is all the rage these days. We all want to share our videos, to share our passions and the things we like. There are so many sites around to publish our videos on the web that it is sometimes hard to make a choice. We know some of them like YouTube, Revver or Dailymotion, but there are so many others competing to be the number one, or targeting a specific audience, whether geographically (China, Japan, Turkey…), by language (German, Arabic, French…) or for the kind of content they enable to publish (cooking, planes, extreme sports…).
I have compiled a growing list of more than 700 video sharing sites, video search engines, and video download sites that you can check at http://www.ilikesharingvideos.com
For each of them, you will get useful information such as their history, the country from which most of their visitors come, their niche, their rank, their latest news…
This site offers some other interesting features, like a forum about online videos, how to make money with your videos, how to create your own YouTube site, etc.
So if you are interested in video sharing or online video marketing, give an eye to this site, it worths it.
Cheers
With all of the socialization of web sites in the US, I think this would work fine. What could be more social than a bunch of people having fun commenting on videos? Most of the things people write are really funny. Remember “Pop-Up Videos”? They were pretty fun and addictive for a while.
Also note that you can turn off some or all of the comments easily.
I think the main weakness of the business model right now is it’s complete reliance on Youtube as a resource for videos. If Youtube Japan put a stop to use of videos originally posted on Youtube, NicoNico would lose a huge part of its library.
Serkan, awesome post. The careful eye on Japanese web properties, feature trends and comparisons, etc. are really helpful. Thanks for sharing.
when thinking about the present success of nicovideo, you have to think about the history of youtube and nicovideo.
I remember, in Japan internet community, youtube get popular in the beginning of 2006. Nicovideo began in the beginning of 2007. first system of nicovideo was just overlay the comment on the youtube video. after, nicovideo have to reopen its system(stop dependence on youtube).
one of the reason of success is , when people needed differences with youtube, niwango could give difference with youtube by new comment system.
also you have to refer to 2-channel, the most popular online forum in Japan.
Though dowango is corporation,dowango have some relation with 2ch.
in 2001, 2ch had big problem of large traffics. the member of the programmer who solved the problem includes present staffs of dowango. this is the very reason dowango can cooperate with owner of 2-channel,Hiroyuki Nishimura , and can make website where 2-channel user enjoy(i mean, the staff of nicovideo and 2-channeler share same sense of online-community)
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In order to discourage users creating multiple accounts at nico video, I believe that new users are only allowed to access videos during a certain period of time. As users kept their account for a while (24 hours I think), they will be able to access videos at any time of the day. Although this does not seem like a strict restriction at first, it appears to effectively eliminate users with multiple accounts (at least in nico video’s case)
Good !
Really good video for me.
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Despite what you think, this site has found a niche among a untapped subculture - Asian geeks who can’t get enough of their anime fix. I should know - I used to room with one in college. He downloads 3 anime episodes / movies a day!
He probably be jumpin’ with joy upon discovering this site - the real-time scrolling text comment is a nifty way for him to communicate with the outside world and probably help him socialize with an internet gf
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I joined Nico Nico recnetly, not long after they took down the view time restriction for new users, but I consider myself a light user as I don’t spend a lot of time watching videos online. So far I’ve only viewed videos in a few specific categories and find it a rather additive experience.
The comment system adds value and often insights to the video. I used to turn off the comments at first, but I rarely do that now. If I feel like it, sometimes I’ll input a few comments when I watch it at home (I can only type Japanese on my home PC).
There’s also videos taking advantage of the comment system and conduct surveys this way. I did a couple fun ones like “If you know so many out of this many anime/game songs, your life is over” and “Which actor/character do you like better.”
The tag system is also quite interesting. The tags would often give you a hint as to what the video might contain (once I saw a tag that warned of the loud volume and was able to turn it down before the video started playing) or what many people think of it. It’s rather entertaining.
I think the video quality is better than YouTube’s, at least in the handful of videos I compared while trying to promote some vocaloid songs to my friends (they don’t understand Japanese so don’t want to bother signing up with Nico Nico). The one down side is that you can’t skip ahead and have to wait for the part to load.
Despite the longer time of my relationship with YouTube, I’ve watched a lot more video on Nico Nico and rarely go to YouTube now. My brother, on the other hand, tried Nico Nico but couldn’t really get past the Japanese interface (I helped him sign up) and went back to YouTube. Surfing habit-wise, I think he’s closer to a typical Westerner’s while I’m closer to an Asian’s. But then, knowing the language probably makes a whole lot of difference.
I actually followed a news link from the homepage of Nico Nico Douga here, btw.
I recently joined Nico Nico Douga, while having only a little understanding of the Japanese language. The registration part wasn’t that hard anyway. I used to browse normally on YouTube if I’m bored, so I don’t really go there all the time searching for videos.
The comment system in Nico Nico Douga makes you feel that you’re watching the video with several other people… Meaning that you’re like joining some kind of video watching party. And sometimes the comments are useful, or they’re just art (watch some of the popular videos in Nico Nico Douga and you’ll sometimes view a whole screen comment of ASCII art). For me, they’re not distracting, they’re useful and fun.
The video quality is very nice, and really awesome when compared to YouTube. And another thing is that they didn’t have time limits for uploaded videos, so they don’t ruin the experience like in YouTube, when I have to click Part 1, Part 2, and so on. I’ve been on YouTube for 2 years now, and I’ve watched more videos in Nico Nico Douga from YouTube. Nowadays I go there all the time and I once spent half a day at that website. Well, mainly watching all the new VOCALOID PVs… Now, I don’t even go to YouTube anymore… Since the quality of video is much better in Nico Nico Douga.
I even promoted the site at school and they all loved it. Well, some of them didn’t really like the comments feature and disabled it, but they loved the video quality. As for me, I love the comments and never disabled them. Maybe the comments are an Asian thing and Westerners doesn’t really like it.
And same as the guy above, I followed the news link on the front page of Nico Nico Douga to here.
kevinay is right. It could be cultural thing, but watching (not reading:) comments and writing comments is a lot of fun. It’s different than just watching what you normally watch on TV show.
Also youtube’s implementation of similar feature is totally different. These are intended for video creator, while niconico’s one is for watchers to be a part of content creation, which is really fun. Some comments are even artistic, which a lot of people would applauld.
It is true that they have better quality and longer videos, but i don’t think it matters. What makes niconico unique is their unique comment system.
If you haven’t tried, just try it.
I, too, came here from the link on Nico Nico’s front page.
As others have said, Nico Nico replicates the experience of watching a video with a group of people in real-time. Sharing reactions as they happen is fun in a way that can’t be duplicated with after-the-fact comments. To this day, it puzzles me that Youtube hasn’t copied this feature.
I went to check out iminlikewithyou.com mentioned in Raskin’s comment, but was disappointed with the messy implementation–huge text balloons with seemingly random popup locations pulling your eyes around the screen, usernames attached to every comment, GRAPHICAL AVATARS?! It’s like they forgot we’re trying to watch a video at the same time…
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Friday 18th, they released its German and Spanish version, and renewed its Taiwan (traditional Chinese) version.
They’ve upgraded into Nico Nico Douga Winter Version now…Hope they’d make an english version soon.