Free services damaging paid blogging market in China?

Comments made by a director of leading Chinese Blogging company Bokee.com, which is functing with a large injection of US Venture Capital would indicate that the free service providers may be killing the paid blogging industry in China.

Interfax quotes an un-named director as saying on the recent downsizing at Bokee:
“The company’s Board made this decision to cut staff, mainly because they are not confident about the future of the blogging industry in China…We will probably change our business strategies after that.”

This in a marketplace of between 33.6 million registered users (Analysys International) and 36.82 million blogs (Baidu) and recent reports that services such as MSN Spaces now lead the market in China.