Sohu Buys Renren Video Unit, Amid New Spending Binge

Renren sells 56.com to Sohu

A couple of new reports are shining a spotlight on the turmoil rippling through the online video space, following a period of huge optimism that ended earlier this year with a crackdown by Beijing. One report shows a major consolidation that took place last year could be getting ready to enter a second round, with word that struggling social networking (SNS) firm Renren (NYSE: RENN) is selling its 56.com online video unit to Sohu (Nasdaq: SOHU), one of the sector’s leaders.

The other report details a new spending binge on self-produced original programs by another leader, Baidu-backed (Nasdaq: BIDU) iQiyi. That trend is accelerating following the regulatory crackdown, which has made purchasing popular TV programs and movies suddenly much more difficult. That’s forcing sites to find other ways to keep their viewers entertained and maintain their viewership. Continue reading

Cellphone Sales Tumble, As Mobile Ads Zoom

Cellphone sales tumble in August

New sales data for August is showing that China’s cellphone market is rapidly cooling due to saturation, putting even more pressure on domestic brands that have engaged in a battle for share that has resulted in plummeting prices. At the same time, a separate report is showing that mobile advertising is zooming, in a development that’s almost certain to mean big headaches for companies like Baidu (Nasdaq: BIDU) and Sina (Nasdaq: SINA) that depend heavily on advertisers that traditionally targeted desktop PC users. The pair of trends both cast a spotlight on how quickly things can change in the tech and media landscapes, putting huge pressure on established companies to innovate and spend heavily to translate their leadership into emerging areas. Continue reading

Shanghai Street View: New Humor

PSA features pandas behaving badly

I’m not a big fan of Chinese public service announcements (PSAs) due to their lack of creativity, but one such advertisement caught my attention this week while I was exercising at the gym. I normally don’t watch the TV very closely as I ride on my exercise bike, and was paying little attention to the cute but clichéd pandas that appeared on the screen during my routine.

But then I noticed these particular pandas were doing some strange things while walking around a western-looking landscape. I quickly realized the common theme was their boorish behavior, as they pushed other people out of the way to take photos and carelessly threw their trash onto city streets.
Continue reading

News Digest: October 22, 2014

The following press releases and media reports about Chinese companies were carried on October 22. To view a full article or story, click on the link next to the headline.
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  • China-Backed Hackers Target Apple’s (Nasdaq: AAPL) iCloud Users: Blog (English article)
  • Renren (NYSE: RENN) To Sell 56.com To Sohu (Nasdaq: SOHU) – Source (English article)
  • Intel (Nasdaq: INTC) Invests $28 Mln In 5 China Tech Companies (Chinese article)
  • TAL Education (NYSE: XRS) Announces Q2 Results, Management Changes (PRNewswire)
  • LDK Files Bankruptcy In US Court On China Solar Glut (English article)
  • Latest calendar for Q3 earnings reports (Earnings calendar)

WeChat, OTTs Nip At China Mobile Revenue

China Mobile posts first-ever revenue drop

Leading telco China Mobile (HKEx: 941; NYSE: CHL) has just released its latest quarterly results that show profits continue to sag by about 10 percent, continuing a theme from the past year. But the figure that’s catching attention in the headlines is the company’s top line revenue, which has fallen for the first time ever in the latest quarter. The revenue drop isn’t all that surprising and comes about a year after China Mobile’s profits first began to decline. But perhaps more worrisome is the prospect that revenue could continue to drop for years until China Mobile finds a way to win back some of the business that is rapidly flowing to third-party service providers like Tencent (HKEx: 700) and a new batch of mobile virtual network operators (VNOs). Continue reading

LaShou Story Ends With Sale To SanPower

LaShou bows with sale to SanPower

The end has finally come for group buying site LaShou, though this former Internet superstar survived for far longer than I ever imagined it would before its newly announced acquisition by conglomerate SanPower Group, which owns a number of online and offline retail brands. Of course this acquisition doesn’t mean the actual death of LaShou, and it’s quite possible the company could still make a comeback under its new ownership. But its acquisition marks one of the final big consolidation moves for a group buying sector that saw explosive growth 3 years ago, followed by a major correction that saw most companies either close or get acquired. Continue reading

Shanghai FTZ On Roll With Costco, Sinopec

Costco sets up in Shanghai FTZ

After a year of mostly hype, Shanghai’s new Free Trade Zone (FTZ) has finally begun showing the world some substance in the last 2 months with a recent string of high-profile announcements by major companies that plan to set up in its borders. Microsoft (Nasdaq: MSFT) and Amazon (Nasdaq: AMZN) were among the first to announce plans, and were joined last week by US retail giant Costco (Nasdaq: COST) and top Chinese oil refiner Sinopec (HKEx: 386; Shanghai: 600028; NYSE: SNP). Continue reading

News Digest: October 21, 2014

The following press releases and media reports about Chinese companies were carried on October 21. To view a full article or story, click on the link next to the headline.
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  • China’s M&A Watchdog Halves Time Taken To Approve Deals (English article)
  • Apple (Nasdaq: AAPL) In Talks With UnionPay, Other For Apple Pay In China (Chinese article)
  • China Mobile (HKEx: 941) Reports Results For First 3 Quarters (HKEx announcement)
  • Tesla (Nasdaq: TSLA) Tries Tmall, To Take Part In Single’s Day Promotion (Chinese article)
  • SanPower Group Acquires Group Buying Site LaShou (Chinese article)
  • Latest calendar for Q3 earnings reports (Earnings calendar)

Warner, Wanda In New China Film Finance Acts

Wanda Cinemas files for domestic IPO

I’ve stopped using the term “love affair” to describe the romance between Hollywood and China over the last 2 years, as it no longer seems sufficient to describe the flood of tie-ups that have emerged since China became the world’s second largest box office. The Long March of new deals has now gained 2 more members, with word that US film giant Warner Bros (NYSE: TWX) is in a major new movie financing deal with Shanghai Media Group (SMG), China’s leading regional maker of filmed entertainment. In a separate headline, other reports are saying that real estate giant Wanda Group is also deepening its own involvement in movie industry finance, by filing to make a domestic IPO for its movie theater business. Continue reading

Loyalty Boosts Apple In iPhone 6 Debut

iPhone 6 draws crowds in China launch

Nearly a month after their global launch, Apple’s (Nasdaq: AAPL) latest iPhones are now formally on sale here in China. We’ll no doubt get flooded with numbers about initial sales in the next few days, some of which may be correct but many of which will probably be just guesses. One larger question that’s on everyone’s mind is promotions by the nation’s 3 telcos, as China Mobile (HKEx: 941; NYSE: CHL), China Unicom (HKEx: 762; NYSE: CHU) and China Telecom (HKEx: 728; NYSE: CHA), as all come under government pressure to cut back on their aggressive subsidies.

The early news looks relatively good for Apple on that front, with one media report saying the 3 telcos are mostly maintaining their aggressive iPhone subsidies from previous levels. We’ll examine that issue shortly, and whether it even matters much. But first let’s look at the bigger picture that had the iPhone 6 receive a relatively strong reception after it went on sale in China on Friday, 4 weeks after its global debut and 3 weeks after its Asia launch. Continue reading

Wanda In Leisure Drive With Travel Buy

Wanda buys Zhejiang travel agency

Wanda Group is already one of China’s leading commercial property owners, and now it’s taking aim at the fast-growing travel sector with word that it’s purchased a major travel agency in affluent Zhejiang province. There’s no financial detail on the deal, but the purchase should help to bolster Wanda’s position that has already made it China’s leading travel company just 2 years after its formation. The group could ultimately become one of China’s leading integrated travel and leisure companies if it eventually lists, providing an attractive alternative to the crowded field of publicly listed firms like online travel agent Ctrip (Nasdaq: CTRP) and leading hotel operator Home Inns (Nasdaq: HMIN). Continue reading