Visitors check the exhibition area of Youdao Inc, the online education subsidiary of China's tech company NetEase, at the 2019 Global Mobile Internet Conference in Guangzhou, Guangdong province. (LI ZHIHAO / FOR CHINA DAILY)
Companies in China's online education sector such as Youdao Inc are further expanding their foreign footprint this year despite the COVID-19 challenges and potential operational risks in some economies.
Liu Renlei, senior vice-president of Youdao Inc, said its U-Dictionary, a popular language learning and translation app, will beef up its presence in Southeast Asia as well as the Middle East and North Africa this year.
"The app, which surpassed Google Translate in some foreign markets, has gained overseas momentum with a total 100 million installations and 1.8 million active users by September last year," he said.
Youdao also climbed the ranks to become one of the top three apps in the Google Play education category in Indonesia, Pakistan, the United Arab Emirates and Colombia, Liu said.
"We are also seeing strong demand from the Southeast Asian market, as the region has a vast number of young users who are eager to learn and improve English."
U-Dictionary mainly enables translation between English and 108 languages and is used in more than 100 countries and regions, he said.
Industry insiders said that compared with rivals such as Google Translate, U-Dictionary offers a better product experience with comprehensive explanations and abundant language choices.
"We have even covered languages that have not been covered by Google Translate yet, such as Assamese and Odia, two local languages in India. In addition, we also provide abundant language learning content," Liu said.
He said the app comes with several technology-enabled functions. The magic translate, for instance, allows users to simply press a floating bubble on the sentence to see the translation after copying the text while browsing, messaging or using any other apps.
Youdao exemplifies Chinese online education companies that have found success both at home and abroad. Booming demand for services that can help study-at-home students whose formal education has been disrupted by COVID-19-related lockdowns, has helped online learning firms to grow rapidly in the domestic market. This, in turn, is now propelling them in global markets, where similar situations have spawned a need for online learning platforms.
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Some 56 countries and regions have closed schools temporarily due to the pandemic. UNESCO estimated that some 850 million young students across the world would find their academic schedules disrupted due to the impact of COVID-19.
The global body recently recommended dozens of online education apps or platforms. Several Chinese platforms such as Alibaba's remote conference platform DingTalk, ByteDance's Feishu, and NetDragon Websoft's Edmodo not only figured in the list but overshadowed others.
Xiong Li, CEO of NetDragon Websoft, said the company will continue to expand its business this year. It opened a new branch in foreign markets last year. "We have already signed new contracts with educational authorities from the United States and Thailand."
The Fuzhou, Fujian province-based company has developed and launched a string of integrated educational devices, including smart boards and panels as well as feedback and evaluation systems. Many of its products and services serve public schools and governments.
"Currently, overseas revenue accounts for the education subsidiary's 70 percent of total revenue. In the overseas market, the payment willingness is much higher than that in the domestic market and there are merely restrictions on how long students can use electronic products," Xiong said.
"We are different from other education companies that focus on a single business. We offer a package, which has become NetDragon's advantage overseas."
Xiong said offering a comprehensive package of learning solutions is part of the company's order-based, low-cost go-global strategy.
"To a certain extent, we take our menu of various products when we go to meet different governments abroad. That helps in tapping their demand. Usually, they tend to buy a package of products."
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Online education companies have a great advantage in going global as they can leverage their abundant experience and technologies in the huge domestic market to shine further overseas.
Jiang Han, a senior researcher at market consultancy Pangoal
Jiang Han, a senior researcher at market consultancy Pangoal, said, "Online education companies have a great advantage in going global as they can leverage their abundant experience and technologies in the huge domestic market to shine further overseas."
Jiang also said Chinese online education firms have been facing a slew of challenges in overseas markets due to operational uncertainties.
In India, for instance, U-Dictionary was banned on grounds of security risks last year.
Liu from Youdao nevertheless attributed the company's success to the Indian market where it has surpassed Google Translate to be the top language app.
"Such success was due to the fact that a considerable number of people in India are desperately motivated (to upgrade themselves and succeed in life). They want to take a leap forward through the acquisition of knowledge. For them, English is one of the quickest ways," Liu said.
"Also, India is currently one of the emerging markets with the most demographic dividend. The market is in a period of rapid growth, and many industries have not yet formed a stable competitive landscape. This is another important opportunity for U-Dictionary."
However, if the ban continues, Liu said the company may have to shift part of its focus to other markets.
Jiang from Pangoal said the overseas momentum of Youdao will boost the go-global plans of parent company NetEase and further consolidate its growth in the online education sector.
As China's second-largest gaming publisher, NetEase merged its online education business unit into Youdao in 2019.
The unit in Hangzhou, Zhejiang province, used to cover business segments like online career education, online software courses and massive open online educational programs.
The move aims to integrate Net-Ease's educational resources for maximize strength. It also shows the parent company's determination to excel as an education firm, said Zhou Feng, CEO of Youdao, in a rare media interview.
According to Zhou, after the merger, Youdao was able to leverage high-quality content and intelligent hardware to beef up its presence in the K12, or kindergarten to 12th grade, sector.
Youdao also launched its latest dictionary pen recently. With an average accuracy of 98.3 percent, the gadget is able to offer a "click and check" experience wherein users can search for a translation instantly with a simple click.
Zhou said the firm aims to leverage technologies including artificial intelligence to step up the commercialization of advanced technologies in the education industry.
"In the long run, Youdao will position itself as an intelligent learning company, where users learn partly through online courses and partly through hardware. Intelligent hardware and online products are important and can supplement each other," he said.
According to the company's earnings report for the fourth quarter of last year, Youdao reported a net income of 1.1 billion yuan (US$169 million), up a staggering 170 percent year-on-year.
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