Lei Jun: Kingsoft’s Success is Attributed to the Mobile Internet Era
From filing the applications on May the eighth til the bell ringing on November 18, it took around six months for Kingsoft Office to list on the STAR board of the Shanghai stock exchange. However, from the first day that it was founded, the company has been through 30 rather turbulent years.
In the 1980s, Kingsoft‘s founder Qiu Bojun was a young man from a small town trying to figure out his life. Unlike every other young person, he got a perfect score in math at the college entrance exam in 1980 and was exceptional at playing Go (Weiqi in Chinese).
Compared to other dreamers of China’s internet community, Qiu was a typical go-getter. To chase a girl he fell in love with, he moved all the way from the state machinery plant he was assigned to to Shenzhen, a city in the southwest of China. The transition, was a “once in a lifetime opportunity” as Qiu later recalled. In the 80s, the city was just beginning its massive transition from a seaside village to a cosmopolitan city under Deng Xiaoping’s reform and opening up policy.
In a small moldy hotel in Shenzhen in 1988, the 24-year old Qiu Bojun started his long march of coding, typing incessantly day and night. What accompanied him was only an ancient 386 computer and several packs of instant noodles. Back then, he didn’t have any coding tools, and had to rely purely on his own logical thinking. After one year and four months of hard work, and writing a total of 122,000 lines of code, the first-ever Chinese office software WPS (Word Processing System) 1.0 was born.
Just as Lei Jun stated during the media interview, “Thirty years ago when Kingsoft was just founded, requirements for programmers were very high in that era. Almost every programmer was a jack of all trades. You had to write code, design the interface, write documents, and run tests. One person equaled a whole research department. So if you want to create a successful product, you have to be a product manager yourself. In the early days, writing software was for heroes.” In this sense, Qiu is a hero. He single-handedly created WPS.
A few months after its launch, WPS achieved massive success around the nation, achieving a market share of 90%, grabbing a total of over 20 million users.
As written in the company’s biography “Dream Kingsoft”, 1988 was seen as a special year in Chinese history. Before that, the emergence and development of Chinese private enterprises were organic. They were mostly born to evade hunger and poverty. However, after that, chasing capital became the new theme.
When Lei Jun, who later came to found Xiaomi, met Qiu at a computer expo, he thought Qiu was everything success stands for. Lei joined Kingsoft in 1992, becoming the sixth employee of the company. Compared to Qiu, Lei has a better instinct for business operations, which was proved in his later years.
Competition with Microsoft
Just like every other national enterprise, its destiny is almost always interwoven with a global tech giant in the same industry. Lei Jun, the general manager of Kingsoft at the time, was tricked into signing a compatibility deal with Microsoft. The compatibility of the two software products lead to massive user loss for WPS. The market share of WPS fell to nearly 3% at the beginning of the 21st century. In 1995, Lei Jun and Kingsoft developed Pangu, which failed massively after only selling 2000 digital copies.
“Unless our nation tells us to retreat, we will never flinch.” Qiu said. In 1997, the new WPS97 was launched, with the research funding Qiu acquired from selling his car and house. The new software again managed to challenge Microsoft. Qiu began his nationwide WPS97 promotional tour, where he gathered some pious followers among college students. The nationalistic sentiment aroused reminds people of the rivalry between iPhone and Huawei smartphones nowadays.
“Staying true to the original self” This has been what chairman Lei Jun and CEO Ge Ke stressed on numerous occasions. It seems cliche, but for a startup, sticking to the original goal is hard, especially when facing all sorts of external adversities and capital problems.
As Lei mentioned during the interview after the bell ringing ceremony on November 18, “Under the crush of Microsoft and piracy, Kingsoft software was indeed leading a very hard life. What put us through those times is that we still firmly believe that a good national software company has big opportunities. In the previous PC wave, we insisted on making office software. In the new wave of mobile internet, we continue to further push the transition towards mobile internet.”
Catching the wave of mobile internet and going global
With the introduction of the iPhone 4 in 2010, the development of smartphones ushered in the development of mobile internet. People got used to opening up and editing files on their smartphones.
According to the 2016 China Mobile Office Analysis Report, in 2014, a total of 75% of respondents said that smartphones are their optimal choice for mobile office applications. The number in 2014 was around 68%.
In 2011, Kingsoft took the lead in releasing the Android version Office software, while Microsoft didn’t release Android Office until June, 2015. On February 25, 2013, Kingsoft launched the iOS version of WPS Office, while Microsoft only released Office for iPhone in June that same year. With Microsoft cracking down on piracy, Kingsoft software began to run ahead with its “free+ premium” model. The “copyright” movement drove the number of pirated Office users and pushed enterprise users towards WPS.
Around 2011, when Lei Jun stepped up as chairman of Kingsoft, WPS’s revenue had just passed 100 million yuan. “At that time we just got $50 million in funding, I recommended them to invest all that money into research and development of mobile software in the next two to three years. Nobody knows how to make mobile office software, my request for them is to simply do it, without thinking too much about making a profit. We have to make the smartphone version of the software.” Lei Jun mentioned in the interview. Under his leadership, the company once again grasped the right opportunity and rode the waves of the mobile internet revolution.
“As we see the success of WPS today, it is definitely because we caught the wave of the mobile Internet era. WPS has become the most commonly used office software on smartphones. I believe WPS will be increasingly user-friendly with smartphone users.” Lei said proudly.
Currently, the company provides online office services for as many as 330 million users, with over 500 million documents created, edited and shared on the WPS platform each day. The WPS Office software now covers over 220 countries and regions, with around 80 million monthly active users overseas.
It is worth mentioning that in recent years, with the rising popularity of Chinese smartphone brands such as Xiaomi and Huawei in the Southeast Asian market, WPS also capitalizes on its better compatibility with the Android operating system. Its overseas users have just surpassed 100 million, with India and Indonesia being the top two countries with the most users. In Thailand, the Thai version of WPS has already been launched. According to Kingsoft‘s spokesperson, the judiciary government in Thailand has started using WPS.
Almost all the top executives present at the Shanghai STAR board IPO used to be programmers. Up until now, 80% of employees at Kingsoft Office are coding engineers.
As Ge Ke, CEO of Kingsoft Office, once mentioned at a Geekpark event, Kingsoft is special in that it is solely built up by programmers. “In the early days, we didn’t have any marketing staff, sales staff or customer service.”
When asked about the internal system stimulating innovation, Ge Ke pointed out, “Jinshan Office is inherently a company with a programmer culture. The structure and cost of internal staff are the highest in this respect. Our proportion of office R&D expenses may be the highest among all companies in the STAR Board, let alone among listed companies.”
“Another example of our programmer culture would be, wherever there are offices with programmers, there is always a cafeteria. Many people have come to Kingsoft for meals. It’s amazing. Our employees are all young people, who come straight to us after college graduation. They work overtime, reluctant to go home. They see the company as their home, and program late into the night. We always provide them with late supper. From the aspects of management, system and talent incentives, Kingsoft encourages programmers to wholeheartedly devote themselves to innovation.”
The banquet on the evening of the Shanghai STAR IPO is named Our New Era. The past thirty years of ups and downs for Kingsoft reflects the ebb and flow of the Chinese tech industry. Qiu Bojun, the one standing next to Lei in a group photo, appeared so much older than what is usually seen in the media, showing the fact that he hasn’t been under the spotlight for quite some time now. Crowned by Chinese media as the No.1 programmer in Chinese internet history, Qiu Bojun is already retired. Lei Jun, on the other hand, is also enjoying his fame as founder of the rising Xiaomi. For Lei, the core of Kingsoft will always be part of him.