The online game industry has just gotten a small hint of potential consolidation, with word that mid-sized player Perfect World (Nasdaq: PWRD) is buying a stake of rival Shanda Games (Nasdaq: GAME), which is in the process of privatizing. The tie-up that will see Perfect World buy about 6 percent of Shanda Games’ shares comes as both companies confront sagging profits, and could kick off a period of consolidation for the highly fragmented industry. I’ve incorrectly predicted such consolidation before, but a recent wave of M&A in China’s Internet and other recent trends could mean that such an overhaul could finally be coming to online games. Read Full Post…
Alibaba founder Jack Ma’s worries about the rapid rise of mobile instant messaging service WeChat appear to be well founded, with word that Tencent’s (HKEx: 700) wildly popular platform will create an exclusive shopping channel for Alibaba’s chief rival JD.com. This kind of deal must certainly be Ma’s biggest nightmare, as it will instantly link JD, China’s second largest e-commerce company, with the hundreds of millions of young Chinese who regularly use WeChat to communicate. What’s more, WeChat has shown itself quite capable of converting its users into shoppers who could easily become JD customers. Read Full Post…
The following press releases and media reports about Chinese companies were carried on April 19-21. To view a full article or story, click on the link next to the headline.
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McDonalds (NYSE: MCD) To Double Franchised Restaurant Ratio In China By 2015 (Chinese article)
Hong Kong is quickly emerging as the preferred starting point for China’s tech companies eager to move outside their home market, with word that video sharing operator LeTV (Shenzhen: 300104) is planning a service launch in the former British colony later this year. Such a move would make LeTV the first of China’s online video and Internet TV firms to test out an overseas market. If the reports are true, LeTV could discover the outside world offers some interesting opportunities, but also major challenges as it goes head-to-head with local players and also global giants like YouTube and Apple (Nasdaq: AAPL). Read Full Post…
Three of China’s shyest tech CEOs have made rare appearances on their microblogs over the past week, emerging from the shadows after difficult periods for at least 2 of their firms. Liu Qingdong, CEO of e-commerce giant JD.com, was the first to come out of his shell, ending a 19 month self-imposed silence. He was followed by NQ Mobile’s (NYSE: NQ) CEO Lin Yu, whose microblog had gone silent since a scandal last year that saw the security software maker came under a short seller attack. Tencent’s (HKEx: 700) CEO Pony Ma also made a relatively rare posting on his microblog, though in this case his appearance was mostly promotional as he trumpeted another major milestone for his company’s popular social networking services. Read Full Post…
Tencent cash pile to double with new mega bond plan
In writing my final post of the week, I’ve just come to the realization that all 3 of my daily posts this Friday mention leading Internet firm Tencent (HKEx: 700), which has just announced a massive bond issuing program almost certainly aimed at future M&A. Perhaps it’s not surprising that Tencent’s name is showing up in almost everything related to the Internet in China these days, since the company is quickly becoming the nation’s dominant online company alongside leading e-commerce firm Alibaba and search leader Baidu (Nasdaq: BIDU). Read Full Post…
An interesting report has just emerged on the nature of traffic on Sina’s (Nasdaq: SINA) Weibomicroblogging service, casting a spotlight on how people use the platform just a week before it gets set to make a major New York IPO. The timing of this latest report looks a bit suspicious, aimed perhaps at further cooling sentiment towards an IPO that was already losing momentum. But from my perspective, this latest finding that a very small number of Weibo users are responsible for most of the site’s original postings isn’t necessarily a bad thing. To the contrary, this kind of revelation could even help Weibo by differentiating it from rival service WeChat, which is growing much faster. Read Full Post…
Just days after reports emerged that China’s top 2 online travel agents were in talks for a potential merger, rivals eLong (Nasdaq: LONG) and venture-backed Tongcheng have announced their own new tie-up that could be prelude to a similar marriage. In an interesting twist, this newest deal looks like it’s being engineered behind the scenes by Tencent (HKEx: 700), China’s leading Internet company that is also a major stakeholder in both eLong and Tongcheng. Such a dynamic would be similar to the bigger deal that emerged earlier this week, which could see leading online search firm Baidu (Nasdaq: BIDU) orchestrate a much larger merger between Ctrip (Nasdaq: CTRP) and Qunar (Nasdaq: QUNR). Read Full Post…
The following press releases and media reports about Chinese companies were carried on April 11. To view a full article or story, click on the link next to the headline.
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eLong (Nasdaq: LONG), Tongcheng Form Strategic Cooperation Agreement (PRNewswire)
Tencent (HKEx: 700) Launches $5 Bln Bond Program (English article)
ZTE (HKEx: 763) Q1 Profit To Surge As 4G Orders Lift Business Outlook (Businesswire)
NQ Mobile (NYSE: NQ) Announces Q4, Fiscal Year 2013 Results (PRNewswire)
Wuxi Suntech (NYSE: STPFQ) Equity Interests Purportedly Transferred To 3rd Party (PRNewswire)
Rising e-commerce giant JD.com has been all over the blogosphere this past week, trumpeting some major adjustments in its core e-commerce unit as it also prepares to become one of the first companies to challenge China’s 3 major telcos under a new plan to open up that sector. Of course all of this comes against the backdrop of JD.com’s own upcoming New York IPO, which could raise up to $1.5 billion.
If I was being cynical, I might say that much of this buzz is aimed at keeping JD in the headlines as it prepares to list, especially since last week saw early signs that the red-hot New York market for Chinese IPOs may be starting to cool. But in this case, I do think that much of the buzz coming from JD seems genuine and isn’t just hype, as the company tries to position itself to pose a major challenge to e-commerce leader Alibaba. Read Full Post…
Fast rising search operators Qihoo 360 (NYSE: QIHU) and Sogou may be challenging sector heavyweight Baidu (Nasdaq: BIDU) in terms of market share, but they’re having far more difficulty finding an audience among advertisers that are the sector’s main revenue source. That’s my main conclusion after seeing the latest data for all 3 companies, which show Qihoo and Sogou making steady gains in terms of search traffic but failing to translate those gains into meaningful revenue. Read Full Post…
