It started with the Olympics, when Samsung Electronics became the official sponsor, and Motorola was banned from advertising cell phones during the Games. This advertising blackout was another setback for Motorola.

For years, Motorola used to be the market leader in the highly profitable Chinese mobile-phone market which consists of 583 million cell-phone users. But its market share plummeted from more than 21% in 2006 to an estimated 7.9% in 2008, according to market researcher Gartner, Inc. (NYSE:IT). In contrast, Nokia’s (NYSE:NOK) share has topped 38% of the market, while Samsung is likely to grab 8.3% this year moving into the No. 2 spot.

China is the world’s largest mobile market, and the Chinese are likely to purchase 192 million new devices this year. Motorola’s position was always stronger in China than worldwide, according Aloysius Choong, research manager at market research firm IDC.

So what went wrong? Motorola faces the same problem in China that plagues it elsewhere: its failure to produce a follow up of its highly popular Razr phone. The Chinese market demands the latest models, since big-city consumers replace their phones frequently and put priority on models that are cool-looking as well as reasonably priced. According to Mark McKechnie, telecom equipment analyst with American Technology Research, it was competitors Nokia, Samsung, and even LG that came up with replacements. In contrast, Motorola’s latest models were pricey multimedia phones that didn’t connect with consumers. While Motorola launched a special smartphone for China, the Ming, it did little for its market position. The result: Chinese consumers have soured on the Motorola brand. Chen Xin, a 37-year-old Beijing resident who works for a local info-tech company, once bought five Motorola phones within four years, but now prefers Nokia or Sony Ericsson.

Nokia remains the leader by offering a wide range of models, covering every segment as pointed out by Dave Carini, an analyst in Beijing with Maverick China Research. Its efficiency is one reason its handset operating margins are about 20%, while Motorola barely breaks even.

Motorola is fighting back and landed $431 million in contracts to provide China Mobile (NYSE:HL), the market leader, with second-generation GSM equipment. It is also working with the other two cellular operators, China Unicom (NYSE:CHU) and China Telecom (NYSE:CHA). It is also launching new phones, including an updated and expanded line of its Ming smartphones.

Will it be enough? Time will tell…….

NBC and Yahoo are still arguing which one got the largest number of online users during the Olympic Games. Well, the real winner is neither of them, but local Chinese online video sites.

DCCI (Data Centre of China Internet) estimates in a recent study that a staggering 244 million viewers, about 95.1% of China’s netizens, watched the Olympics online on one of the the nine authorized sites, such as PPS.TV, PPLive, Sohu, ku6 and UUSee.

netizens who are also Olympic fans were able to not only enjoy a high-quality video experience but also had the opportunity to watch the Beijing 2008 Olympics through their PCs anywhere and anytime.

The highest increase in online viewers occurred among the young and high-income users. With a brand loyalty of 82%, the competition for acquiring new and keeping existing online users is fierce. The main strategy is to try to take the lead and to legitimize online video and TV. This requires investment in quality offerings and for copyrights. New and fresh content is used to attract users, but also advertisers to ensure revenue streams.

The online TV sites purchase content from the CCTV channels, including the CCTV Olympics Channel.
They also offer programs on demand, which is highly attractive for advertisers for product placement.

Nike, LG, Pepsi, China Mobile, Budweiser and Merchant Bank are just a few companies that advertise their brands.

If we look at online entertainment, we see that close to 70% of the online users listen to online music, half of all online users play online games and more than 60% of all online users watch movies and TV series online (Source: Internet World Statistics). Needless to say, it provides lots of opportunities for online TV offerings.

If we look at the development of China’s online video industry, Bill Gates’ prophecy that online videos could overtake regular TV leadership in as little as five years might come true.