The Chinese Kindle store will compete with Chinese e-commerce giant Dangdang, which has sold ebooks since December 2011. Dangdang’s collection includes around 100,000 ebooks, and the company recently says it expects to sell more ebooks than print books within three years. China is a tricky but potentially highly lucrative market for foreign publishers.

Reuters reports that “In June, four Kindle models, including the Kindle Touch and Kindle Fire and as well as one Kindle keyboard, received approval from the State Radio Regulation of China, the regulatory body for radio and wireless products. Amazon’s former China chief told Reuters this year that the company was in talks with Chinese publishers on content deals and hoped to launch the Kindle within two years.” But Amazon has gone ahead and launched the store in the absence of a dedicated reading device.

I explored the Chinese Kindle store with the help of Google Translate, so take this all with a few grains of salt, but some notes:

• The store includes 24,479 ebooks.
• The top-selling book is Rip It Up by British pop psychologist Richard Wiseman. In Chinese its title appears to translate to Positive Energy. In the #2 slot is the Nobel Prize-winning Life and Death are Wearing Me Out by Mo Yan.
• Most prices are very low compared to ebook prices in the U.S. and Europe: A special section of the store breaks out a weekly selection of books for ¥1.99 (USD $0.32) or less. Rip It Up sells at ¥3.99 (USD $0.64) and Life and Death are Wearing Me Out at ¥3.49 (USD $0.56). By comparison, Steve Jobs’ biography, featured on the Chinese Kindle store’s home page, is a big investment at ¥40.70 (USD $6.53). If that’s too much, there’s a multitude of other Steve Jobs ebooks, many with covers that blatantly rip off Walter Isaacson’s biography, for sale under ¥10.

But that is indeed the case, according to annual research conducted for UK communications regulator Ofcom…

Although at least half of those polled in eight other countries said they never pay for content, that was just 16 percent in China, where more than half of internet users sometimes or regularly do so.

These are much desired numbers for online operators who find it hard to get consumers to cough up. So what’s going on here?

Back in the summer I questioned a different research exercise for finding unexpectedly high numbers of people who planned to watch the Olympics online. The finding did not tally with what we know about internet adoption that, whilst booming among urbanites, is growing more slowly elsewhere.

Like that research, Ofcom’s naturally skews toward young, urban and more affluent consumers — as opposed to the much poorer citizens in more rural areas — because this is where China still sits on its internet adoption curve.

In the same way, note how — surprisingly — a far higher percentage of people in China than elsewhere (around three quarters) say the internet is their main source of national news… Whilst internet adoption has reached mass-participation levels in many western countries, it simply isn’t true to say that three quarters of Chinese are online…

That is not necessarily a bad thing, depending on who you are — this early adopter herd is at least a ring-fenced segment of attractive demographics for any internet services looking for customers.

Amongst the most successful so far is Tencent, the diversified giant that ranks #9 on our paidContent 50 list of the world’s highest revenue-earning digital content companies and which this summer told us over 30 million of its then 752 million members were paying 10RMB  ($1.60) per month.

In time, as China’s internet demographic begins to more closely resemble its nation’s — by way of low-cost handsets, for example — I would expect this curiously high proclivity to pay to wane. And content operators may be forced to accept lower fees than they do in other parts of the world.

A day after rival video service Youku Tudou secured a deal to stream premium movies from an eighth and final Hollywood major studio, Tencent has got in touch to flag its own numbers.

Citing iResearch data, the outfit says its 275.5 million monthly Tencent Video users has grown to exceed even the recently merged Youku’s 266.3 million, while its average 54.8 minutes per user per day spent on-site beats Youku’s 34 minutes.

Although Youku Tudou now has an increasingly impressive professional content line-up, Tencent’s media briefing cites an Aegis executive who explains: “The reason why Tencent Video has achieved more unique visitors than Youku is the parent company’s ownership of social media properties that have pushed traffic towards its video site via social sharing.”

That would suggest scale can beat prestige and premium content when it comes to drawing eyeballs — or, at least, that domestic content trumps Hollywood imports. Tencent has an arsenal of services including its QQ IM network with over 700 million users, Qzone and Pengyou social networks, games, the Weixin mobile community client, and a Twitter rival with around 400 million registered users. Tencent placed at #9 in this year’s paidContent 50 list of the world’s biggest digital content earners.

If broadband speeds can continue increasing sufficiently, China’s online video viewing market could be set to explode.

Recently, I reported how one video service was even manufacturing its own internet-connected TV to take its content direct to living rooms.

Yet another new platform hopeful aims to replicate the pattern in which China is also seeing a creative explosion of smartphone systems thanks to operators and services rebadging Google’s Android.

Xiaomi, which has found success by releasing the low-cost M-1 Android handset running a slick firmware variant dubbed “MIUI”, is now planning to unveil an Android-powered internet TV set-top box.

iResearch concludes: “A Xiaomi set-top box would attract even closer comparisons between the company’s product line and Apple’s. Xiaomi founder Lei Jun is sometimes referred to as the ‘Chinese Steve Jobs’.”

Youku Tudou has gained a distribution license from Sony Pictures Television (SPT) to offer 300 Sony Pictures titles through its Youku Premium service (announcement).

The SPT deal is the eighth and final deal with a Hollywood major studio and runs for five years, giving the service a long window in which to exploit Chinese demand for premium internet video.

Although Youku and Tudou, like YouTube in the west, launched with a focus on amateur uploads, they are also fast trying to secure A-list movie and TV content.

Youku launched its Premium service comprising TV and films in beta in 2010. The service offers both subscription and on-demand access.

VP Huilong Zhu (via release) today disclosed it has around two million paying users:

“Subscriber growth for Youku Premium has exceeded our expectations, and we see it as a sign that Chinese audiences are willing and eager to pay for quality content. By providing a wide range of payment and subscription options, Youku Tudou has made it as simple as possible for them to do so.”

Last month, in its annual report for the year to December 31, 2011, Youku said Youku Premium had “processed more than one million paid orders, which include both pay-per-view and subscription orders … though we currently derive minimal revenues from subscription-based and pay-per-view services”.

Those revenues are now likely to grow — but the attractive deals also further threaten Youku Tudou’s bottom line. The pair consolidated in a big merger deal this summer precisely to save on the costs of content acquisition and broadband infrastructure, the latter of which has become especially burdensome.

Youku Premium will count around 3,000 titles in total, including 450 from Hollywood, by year’s end.

Sony Pictures titles include older fare like Groundhog Day, Bram Stoker’s Dracula and Sense and Sensibility plus newer releases including Men in Black 3, The Amazing Spider-Man and 21 Jump Street.

Redmond, WA-based mobile advertising firm Red Loop Media says it won a contract to power mobile ads for China’s state news network.

China Xinhua News Corporation (CNC) is part of the country’s official Xinhua News Agency, which reports to the Communist Party, and began broadcasting in 2010. CNC recently launched mobile apps, like this for iPhone, offering live and on-demand video news.

Red Loop says it will serve ads in to the apps and provide targeting and analytics. It is a follow-up to a deal the firm announced in June to power mobile ads for China National Radio’s apps.

Western tech companies generally have a hard time trying to break China. Amongst large players, Facebook still has not broken through and Google has had to balance commerce with censorship, while local outfits are creatively building their own services on the back of Silicon Valley software. The prospects for smaller vendors might, therefore, have appeared even more remote.

But Red Loop’s success there appears to come because the Redmond firm also operates a distinct Chinese subsidiary. Earlier this year, the Chinese version of Newsweek selected the firm to power its mobile and tablet app ads. The company uses MWave, an advertising firm staffed by former Chinese ad agency sales execs, in its efforts there.

If this mixing of Chinese propaganda and US-style techno-capitalism blends like oil and water, recall, too, that the People’s Daily newspaper, an organ of China’s ruling Communist Part, took its online news operation public in April to raise around 1.55 billion yuan ($245.45 million) to finance improvements to its mobile news service. The publisher, which takes a quarter of its content from Xinhua, wants to retain its influence by catering to a younger generation of citizen that is rapidly adopting mobile and social platforms.

China’s smartphone segment is booming, with many internet users now going straight to phone, leapfrogging landline connections, and the country is seeing a creative explosion in Android tinkering.

Xinhua reports to the Propaganda and Public Information Department in China.

But an even more intriguing variant of that opportunity might be owning the TVs, too.

That is what Chinese video site LeTV is doing, having announced it will sell something it’s calling “Super LeTV”.

The company says the idea is to profit from “Hardware + Contents + Sharing Revenues from Apps + Terminal advertisements”, reports TechNode, which says LeTV’s holding company has put up RMB 28.28 million ($4.5 million) for the project.

LeTV is committing to invest between RMB 500 million ($79.5 million) and RMB 1.5 billion ($238 million) in to the new business, according to Marbridge Consulting, which says Beijing incubator Innovation Works will invest in to the operation.

TechInAsia: “If such a television were to take hold in China, one would think it would bode well for online video companies, most notably for Youku/Tudou as the most dominant player in that space.”

LeTV already unveiled its own set-top box earlier this year, so an integrated TV is not such a stretch. Manufacture would be sub-contracted out.

As well as amateur video, LeTV and its peers Youku and Tudou host premium video from TV and movie makers.

Last week, Russian web portal Mail.ru unveiled its own branded web browser based on Google’s chrome.

Today, Yandex, Russia’s leading search site, is announcing two products in one day that, whilst based on Google software, will nevertheless prove problematic for Mountain View.

It is introducing its own web browser based on Chrome‘s Chromium framework and is launching an alternative Android app store that will let mobile users get their apps from Yandex, not Google.

The web browser goes further than Chrome by integrating Kaspersky malware detection and Opera’s page compaction technology.

The Android app store, Yandex.Store, is being hailed by the Russian outfit as “yet another building block in Yandex’s mobile ecosystem”:

“The company can now offer an alternative package of mobile solutions to any Original Equipment Manufacturer around the world who would like to build their own Android-based smartphone or tablet. Yandex’s mobile ecosystem now has all key components to provide OEMs with an opportunity to customize their devices: 3D user interface Yandex.Shell, a bunch of out-of-the-box mobile apps, including Yandex.Search, Yandex.Mail, Yandex.Maps-based services, and, finally, Yandex.Store with a wide range of applications from Android developer community.”

First of those  OEMs will be MegaFon, the Russian mobile telco, which will be using Yandex.Store to power Android apps on its handsets.

The tactic is interesting because Yandex doesn’t have its own Android-based full mobile operating system, as some other services do, but is inserting itself in to the mobile value chain as an Android interlocutor.

Google’s desktop and mobile software is beginning to support large businesses overseas. Each time it does so, it leaves a smaller emerging-markets opportunity for Google itself to gobble up. By launching their own web browsers, Mail.ru and Yandex will get to lock users in to their own sets of services. In mobile, Yandex says it will take a 30 percent cut of transactions processed through Yandex.Store.

China’s largest consumer e-commerce retailer, Taobao, has signed a memorandum of understanding (MOU) with the Motion Picture Association of America (MPAA) in which it commits to remove counterfeit physical copies of movies (release).

That commitment means Alibaba Group-owned Taobao will require its merchants hold licenses necessary for selling legal versions.

The MOU concerns physical entertainment and stops short of brokering a deal for internet film distribution. But it may help divert illegal consumption toward legal movie services now being offered by local video sites.

Services like Youku and Tudou have, over the last year, gained licenses from several Hollywood studios to show their movies to premium subscribers in China.

Previously, the music industry had successfully sued Baidu to end its deep linking from search results to illegally-hosted MP3 files. The case was settled out of court and saw Baidu eventually launch its own legal music service, Ting, replacing unauthorised deep links.

Shareholders of the companies voted in favour of March’s proposal this weekend. The companies, each of which are listed in New York, will survive on Wall Street as the unified Youku Tudou Inc.

Chinese online video is set to explode, but reviewing this pair’s recent performance shows why consolidation is necessary.

Tudou’s Q2 net loss doubled to RMB 154.7 million ($24.4 million) from last year. Youku’s Q1 net loss trebled to RMB 156.1 million ($24.8 million).

By merging, the duo aims to save $60 million on content licensing, bandwidth and other areas. As fast as Chinese online video appetite is growing, vendors are having to spend on intelligently delivering optimising distribution for patchy broadband networks. Just 20 percent of the country enjoys over 2Mbps, according to Akamai.

Youku had a leading 21.8 percent of Chinese online video revenue in Q1, ahead of Tudou with 13.7 percent, according to Analysys International.

They operate much like YouTube (NSDQ: GOOG), majoring on user-uploaded videos but doing an increasing number of deals with domestic TV show makers and global movie companies to host ad-supported and premium videos.

Competitors have been building and buying to stay in touch. The big Sina (NSDQ: SINA) portal had targeted video as its main investment area. It had bought up stakes in Tudou. Now it will end up without influence in Tudou and struggling to build its own capability. Tencent and Baidu (iQiyi) are well-placed to self-fund their own video expansion.

Even more impressive: CNTV served a total of 610 million streams to mobile phones, tablets and connected devices alone. China’s online video viewing has traditionally been dominated by PC usage, and Internet-connected TVs and set-top boxes are still a rare sight. However, smart phone and tablet ownership is growing quickly. CNTV addressed this new audience with a dedicated premium offering for the 2012 Olympics that was facilitated by U.S. streaming platform provider Neulion.

Some other key metrics provided by CNTV include: CNTV’s website registered 580 million page views and around 35 million unique viewers per day on average during the games. Page views were about 255 percent higher than daily averages before the games, and uniques were up 134 percent. At peak, CNTV clocked 880 million daily page views, and 40 million uniques, which I’ve been told is a historical record for the broadcaster.

How do these numbers compare? NBC saw 159 million video streams during the Olympics across all devices, and NBCOlympics.com clocked close to two billion page views for the entirety of the event, according to NBC. The BBC’s website saw 106 million total video views and 12 million mobile video views throughout the games.

CNTV’s Neulion partnership wasn’t the only way to view video of the games within China. The broadcaster also streamed video on its own site as well as through its CBOX P2P client, set-top boxes and connected devices. It also piped video to Sina, Sohu, Tencent and Netease in an effort that’s been called “one cloud, multiple screens.”