China Internet ‘Godfather’ Chen Tong Steps Down
The names of top executives from some of the world’s leading tech firms have filled the headlines these last 2 days, as Apple (Nasdaq: AAPL) CEO Tim Cook, Facebook (Nasdaq: FB) CEO Mark Zuckerberg and IBM (NYSE: IBM) CEO Virginia Rometty visit China to promote their companies. But today I wanted to focus on a far less known Chinese Internet pioneer, Chen Tong, who is making headlines in his native China as he steps down at Sina (Nasdaq: SINA), the country’s leading web portal and one of its earliest Internet companies.
Perhaps one reason I’m attracted to Chen’s story is because he comes from a background similar to my own, starting out as a journalist when he joined a company in 1997 that would later lead to his employer of nearly 2 decades. Anyone who knows the Chinese Internet realizes that 2 decades is really the entire history of the medium in China, and Chen’s early arrival and wide popularity among industry veterans is drawing widespread praise and some sadness as he steps down.
Chen’s current employer Sina was cobbled together from 2 separate companies when it took shape in its current form in the late 1990s during the US dot-com bubble. The firm made a landmark IPO in 2000, and was followed a short time later by 2 of China’s other earliest Internet companies, NetEase (Nasdaq: NTES) and Sohu (Nasdaq: SOHU).
Before I go into too much history and what Chen’s retirement means, let’s look at the latest reports that are relatively brief and simply say that Chen has formally left Sina. (Chinese article) There’s no indication that the 47-year-old Chen was forced out, and instead it looks like he simply decided it was time to hand over the reins to a younger generation. His title at the time was editor in chief, reflecting his journalistic background.
Chen represents the earliest generation of young people who helped to set up China’s first Internet companies. Few of those had any business experience, but instead came from other backgrounds like journalism, science, or even foreign language study as was the case with English language major and Alibaba (NYSE: BABA) founder Jack Ma.
In announcing his departure, Chen calls the move a “change” and not a “farewell”, perhaps indicating he will go to another Internet company to try something new. One report calls him the “godfather” of the China Internet. Another from the same publication reflects on his career at Sina, recounting one time when he personally paid penalties for mistakes made by his reporting team at the company’s core news business. (Chinese article)
I started following Sina shortly after its IPO, and watched with amusement as it and Sohu and NetEase all flirted with disaster in their early years as the Internet bubble burst and they struggled to find a formula for earning money. Sina finally found that formula with paid text messaging services, and went on to become a major force in Internet advertising. Along the way it dabbled in businesses ranging from real estate to e-commerce, but never found any success until it stumbled onto social networking with its Twitter-like Weibo (Nasdaq: WB).
I have no doubt that Sina will continue to be a major player on China’s Internet even after Chen’s departure, though perhaps the place won’t be quite the same now that he’s gone. I also suspect that his departure could mark the start of a wave of exits by other longtime executives from Sina and some of the industry’s other veteran companies. But that’s the way things go in any industry, even though it does seem like Chen’s departure does symbolically mark the beginning of the end of an era for China’s Internet.
Bottom line: Chen Tong’s departure from Sina marks the start of a wave of retirements by Chinese Internet pioneers, paving the way for a new generation of leaders with more business and technology experience.
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