Journalist China

Tech giant Micron Technology (NYSE: MU), trying hard to stay relevant in the difficult memory chip market, has made an interesting tactical decision in choosing to triple the size of its China manufacturing operations in the interior city of Xian. (English announcement) By making such a move, Micron, which said it now gets more than half of its revenue from the China market, is placing a big bet that China will solidify its place as the world’s “gadget central” for at least the next 5-10 years — a wager that bodes well for PC and smartphone makers like ZTE (HKEx: 763; Shenzhen: 000063), Hon Hai (Taipei: 2317), Lenovo (HKEx: 992) and Quanta (Taipei: 2382), which are some of the biggest consumers of memory chips and have major manufacturing operations in China. If it’s hunch is right, its move could also give Micron the advantage over other industry players, most notably Hynix and Samsung, which do most of their manufacturing in South Korea.

Bottom line: Micron’s gamble on China could pay handsome dividends if the market solidifies its place as the world’s hub for gadget manufacturing, giving it an edge over its Korean rivals.

在举步维艰的记忆芯片市场苦苦求生的美光科技股份有限公司(NYSE: MU)最近作出一个耐人寻味的决定，那就是扩建其在西安的制造工厂。美光科技称如今其收入一半以上来自中国市场，并认定中国会在未来5-10年巩固其世界“电子元器件中心”的地位。对於中兴通讯<000063.SZ> <0763.HK>，鸿海精密<2317.TW>，联想<0992.HK>，广达<2382.TW>等个人电脑和智能手机生产商来说，这是个好消息。这些公司都是记忆芯片的大买家，也在中国大陆有大型制造基地。如果美光科技的直觉正确，那麽它将在与韩国海力士(Hynix)以及三星等对手的竞争中获利。

一句话：如果中国在电子元器件制造领域的核心地位得到巩固，那麽美光科技的赌注就会得到大丰收，还会获得与韩国对手竞争的优势。

Related postings 相关文章:

◙ SMIC: Forging a Better Future?

I’m not a big fan of writing about rumors, but in this case something’s clearly going on with video sharing site Tudou, whose name means “potato” in Chinese and which looks like its days as an independent private company are limited. Word in the Chinese media, which admits that it’s all rumors, is that Tudou is looking for a buyer, after it lost its race with rival Youku (NYSE: YOKU) to become China’s first publicly listed video sharing site. (Chinese article) Clearly this is a company with problems, though it appears that many of those may be less business-related and more related to the recent divorce and personal life of Tudou head potato Gary Wang. If that’s the case and the rumors are true that he’s trying to sell the company, this could be a great way for Youku to increase its dominance in the space, or an excellent opportunity for another company looking to quickly expand, such as Tencent (HKEx: 700). Of course, it all will depend if the price is right.

Bottom line: Tudou’s troubles appear to be non-business related, making the company an attractive acquisition target in the video sharing space.

我并不热衷於撰文讨论流言，但这一次，视频分享网站土豆网显然是遇到了点什麽事情，其作为独立企业的日子可能快到头了。在中国的传媒圈流传的消息是，土豆在寻找买家。此前土豆在与优酷<YOKU.N>竞争成为中国首个上市的视频分享网站的交锋中败下阵来。土豆很明显是个有问题的公司，虽然很多问题可能与商业无关，而是关於其创始人王微近期的离婚和个人生活。如果他果然要卖掉公司，那麽对於优酷来说，这就是个占领市场的绝佳机会，或者对於腾讯<0700.HK>等希望快速扩张的公司来说也是天赐良机。当然，一切都取决於售价是否合适。

一句话：土豆的问题可能与商业无关，这意味着土豆是视频分享网站市场一个好的并购对象。

Related postings 相关文章:

◙ Tencent Takes Serious Shot at Video 腾讯重拳出击视频业务

◙ Tencent Takes on Video Sharing in New Alliance 腾讯觊觎视频霸主地位

◙ Xunlei Looks Even More Interesting in Baidu Tie-Up

China Mobile’s (HKEx; 941; NYSE: CHL) first quarter results are out, and the picture certainly isn’t pretty for the country’s dominant mobile company (English results; Chinese results) The top and bottom line both show the usual single-digit slow growth that has become the norm for this company in the last 3 years as it builds off its dominant position without any new products to excite consumers. But what’s slightly alarming is the big drop in monthly revenue per user, which tumbled to 12 percent by the end of March versus the end of 2010. That’s a huge drop for such a short period, and clear evidence that the company is struggling to keep up with aggressive tactics by rivals Unicom (HKEx: 762; NYSE: CHU) and China Telecom (HKEx: 728; NYSE: CHT) to win share with vastly superior 3G products. If the numbers keep eroding like this, China Mobile’s growth could very well flatten completely or even slip into negative territory.

Bottom line: China Mobile’s already-anemic growth is in danger of slipping into negative territory as it tries unsuccessfully to fend off competition from Unicom and China Telecom.

中国移动<0941.HK> <CHL.N>首季度财报出炉，情况看上去不是很妙。营收和利润数字说明，其过去三年的个位数缓慢增长速度已成常态。虽然中国移动没有推出任何能取悦消费者的新产品，却依然占领市场老大地位，但稍令人警惕的是，其平均每月每户收入营收大幅降低，截至今年3月的数字与2010年年底相比下降12%。在如此短的时间内，这样的降幅还是很大的，而且这也清楚地说明，中国移动正苦苦应对中国联通<0762.HK> <CHU.N>和中国电信<0728.HK> <CHA.N>对3G产品市场份额的争夺。要是这一数字继续呈下降趋势，中国移动的增长速度可能更会大幅萎缩，甚至跌成亏损状态。

一句话：如果中国移动没能抵御住来自中国联通和中国电信的竞争，其岌岌可危的增长速度将面临变成亏损的危险。

Related postings 相关文章:

◙ China Mobile Wi-Fi Play Misguided 中移动：百万WiFi热点？

◙ China Mobile Pushes Ahead With 4G Trial, Challenges Regulator 中国移动急於进军4G

◙ 2011: Year of the Unicom 2011：联通的好运年

I think I may write a bit too much about ZTE (HKEx: 763; Shenzhen: 000063); but considering the company is at a critical point in its development, similar to what many of China’s emerging export powerhouses will face down the road, hopefully the excess ink is justified. The point I’m trying to make was all too apparent in ZTE’s just-published first-quarter results which showed its profit and revenue grew just 15 percent — a number that looks downright Western in terms of what you might see for a more mature company like Ericsson (Stockholm: ERIC). Even more alarming, ZTE’s core networking equipment business grew by less than 2 percent, as it faces numerous obstacles, including government bureaucracy in India, political hostility in the US, and a lawsuit from Ericsson in Europe. The one bright spot in all this was its handset business, which jumped 50 percent and was obviously the major driver behind the quarter’s growth. Given the less controversial nature of handsets, ZTE would be well advised to focus on this segment of its business and tone down its efforts on the networking equipment front. Crosstown rival Huawei would be well advised to make similar moves. But as these two make this painful transition, look for some less-than-stellar numbers in both their top and bottom lines in the next year or two.

Bottom line: ZTE needs to transition from a networking equipment company to a more diversified telecoms player, to avoid ending up like just another slow-growth Western company.

我可能写了太多关於中兴通讯<0763.HK><000063. SZ>的文章了。但考虑到这家公司正处於发展的关键环节，中国的很多大型出口型企业将面临类似的问题，我还是希望再多花些笔墨。我想说的，在中兴刚发布的第一季度财报中体现得再明白不过了–利润和营收仅增长15%。这个数字看起来完全就是一个西方国家的公司，比如爱立信<ERICb.ST>这样更为成熟的公司。让人更为警觉的是，中兴的核心业务–网络设备业务增长不足2%，同时还在面临很多困难，如印度政府的官僚主义、美国政界的敌意以及爱立信在欧洲的一起诉讼。财报唯一的亮点是增长率达50%的手机业务，这是该季度增长的主要推动力。中兴也许应该专注于手机，降低其网络设备业务的比重。外界认为，中兴的直接竞争对手华为也应该这麽做。在两家公司做出这种痛苦的转型时，他们未来一两年的营收和利润数字可能会不那麽吸引人。

一句话：中兴需要从网络设备商向着更多元化方向转型，以避免走上西方企业的缓慢增长老路。

Related postings 相关文章:

◙ Huawei Looks for Growth in IT Services 华为在IT服务领域寻求增长机遇

◙ ZTE Pressures Ericsson With China Suit — NOT 中兴反诉爱立信

◙ ZTE, Huawei Stumble Some More 华为中兴：难兄难弟

It seems that Sinopec (NYSE: SNP; HKEx: 386), embroiled in a scandal over lavish spending on liquor, is fighting back with its own propaganda blitz to try and win back the hearts of consumers frustrated by rich profits and high prices being posted by China’s big oil companies. (previous post) In its rather feeble attempt to look like the good guy for once, Sinopec is saying it will stop exporting its refined oil products to markets where it could presumably earn more money to assist Chinese consumers struggling with high prices at home. (Chinese article) I’m sorry to say this, but Sinopec willl need to do much more than this to mend fences with angry Chinese consumers, and the only way to do that is to lower gasoline prices significantly and do a little profit trimming as well. The same holds true for PetroChina (NYSE: PTR; HKEx: 857; Shanghai: 601857) and CNOOC (NYSE: CEO; HKEx: 883), which are both wisely staying silent during the Sinopec scandal. But in this case, simple silence won’t be enough.

Bottom line: Beijing and Chinese consumers will only be satisfied when the three oil majors significantly lower prices and trim their profits.

卷入了天价酒丑闻的中石化< 600028.SS><0386.HK>似乎正试图利用自己的宣传部门赢回消费者的心。为了维护形象，中石化宣称尽管成品油出口效益较好，但是为保障国内供应，帮助国内市场平抑油价，已暂停出口成品油。我的话可能有点不客气，但是中石化要想挽回人心，要做的可不止这些。要想赢回中国消费者的心，唯一能做的就是大幅降低油价，同时稍微削减一下利润。对於中石油<0857.HK><601857.SS><PTR.N>、中海油<0883.HK><CEO.N>来说也是如此。这两家公司在天价酒丑闻中都聪明地保持了沉默。但这一次，沉默还远远不够。

一句话：只有这三家石油巨头大幅降价，削减利润，中国的消费者才会满意。

Related postings 相关文章:

◙ Sinopec Scandal Points to Big Oil Crackdown 中石化：“天价酒”事件实为敲山震虎？

◙ China’s Oil Shuffle: Not So Fast, Naysayers 石油巨头高管轮换：先别急着唱衰

◙ Sorry, Sinopec. Beijing’s more concerned wtih inflation, social stability

With the annual Shanghai Auto Show kicking off yesterday, I’d be remiss if I didn’t do a posting or two about the latest news coming from China’s car industry. Not surprisingly, one of the big themes this year, apart from slowing sales, is new energy vehicles, which Beijing is heavily promoting. Most of the major domestic automakers, including Geely (HKEx: 175), BYD (HKEx: 1211), Dongfeng (HKEx: 489) and Guangzhou Auto (HKEx: 2238), were talking up their green car initiatives at the show (English article) even though sales so far are almost non-existent. I’ve no doubt that sales will pick up as new models start to come to market, helped much more by Beijing’s strong incentives than any environmental awareness among Chinese consumers. But given the complex technology needed to run these cars, and the fact that much of it is still a work-in-progress even among the most advanced car makers, China is hardly the place for this new technology to develop. Given that situation, I’d say to look for a bumper crop of duds to roll off China’s green auto production lines in the next couple of years, with this well-intentioned initiative largely destined to fail and those carmakers who invest heavily in it to take major write-offs.

Bottom line: China’s green car initiative is doomed to failure due to the complex nature of the technology, which needs to be perfected first in the West.

上 海车展昨天开幕。并不出人意料的是，今年的车展上一大主题是中国政府大力提倡新能源汽车。大多数国内汽车制造商，如吉利<0175.HK>和 比亚迪<1211.HK>，东风<0489.HK>，广州汽车<2238.HK>都纷纷在车展上展示新能源概念车， 尽管迄今为止中国市场还几乎没有新能源汽车在销售。我相信，当市场开始销售新能源车型後，销量会上升，而这更多地是受政府的高补贴政策，而不是消费者环保 意识的推动。但考虑到环保车型所需技术复杂，且即使是汽车行业最先进的厂商，大部分新能源车型还处於研发阶段的事实，中国几乎不可能是新能源汽车技术能取 得突破的地点。因此，我预计未来几年中国会出现大量技术不过硬的环保车型，政府的好意相当程度上可能落空，大力投资生产绿色车型的制造商要蒙受重大损失。

一句话：因新能源汽车技术的复杂性，新技术需要先在西方市场趋於成熟，中国倡导新能源汽车的努力注定将会失败。

Related postings 相关文章:

◙ It’s Good News, But More Is Needed To Jump-Start BYD 比亚迪：需要更多好消息

◙ Honda, Guangzhou Auto Chase GM-SAIC 本田广汽“理念”将上市

◙ Autos: a Desperate Capital Grab for Jianghuai, and Dongfeng’s Silly South Africa Plans 汽车业：江淮增发东风出口

Shanda Interactive (Nasdaq: SNDA) Chairman Chen Tianqiao may be confused about what he wants his company to be, but don’t anyone ever call this guy boring. Just a couple of years after spinning off his core online game business into Shanda Games (Nasdaq: GAME) Chen is loudly floating the idea of spinning off his online literature company into yet another publicly listed company called Cloudary Corp. (English announcement; English article; Chinese article) I’ll be the first to admit I was quite amazed to see that Shanda Interactive shares shot up 17 percent on the news, as this seems like just another of Chen’s shenanigans to get more money from investors. Certainly someone seems to like Chen’s strategy of monetizing his different businesses, which does make it easier for investors to choose which parts of the company they want to buy into. But let’s look at the numbers: Shanda Interactive and Shanda Game stock are both down slightly over the last year, even after the one-day rally, versus a 10 percent rise for the Nasdaq. Chen may certainly be a dealmaker, but he needs to focus on making products that can excite consumers if he really wants to attract investors.

Bottom line: Initial investor enthusiasm for Shanda’s online literature spin-off will quickly fade, leaving the market with yet another Shanda dud if and when its online literature unit makes an IPO.

盛大网络<SNDA.O>董事长陈天桥可能也搞不明白，他究竟想让公司变成什麽样，但你绝不能说他是个乏味的人。盛大游戏<GAME.O>分拆上市没两年，他又大张旗鼓地宣扬旗下盛大文学分拆上市的计划。盛大网络股价受此消息激励而飙涨17%，这真的令我感到吃惊，因为我觉得，这听起来不过是陈天桥圈钱新招而已。当然，有的人似乎支持陈天桥将旗下不同业务“货币化”，因为这样便于投资者选择更具体的投资方向。但我们不妨来看看数字：盛大网络和盛大游戏股价即便在周一大涨後，较上年同期仍略跌，而同期Nasdaq指数却上扬了10%。陈天桥也许擅长融资交易，但他如果真的想吸引投资者，就应该把注意力放在如何推出吸引消费者的产品方面。

一句话：投资者对盛大文学分拆上市的追捧气氛将迅速消退，若盛大文学真的进行首次公开上市(IPO)，无非是盛大又一个失败的产物。

Related postings 相关文章:

◙ Don’t Gamble on Shanda, Says CCTV 盛大被曝光

◙ Ku6 Media CEO Falls Victim to Whimsical Ways of Shanda’s Chen

◙ Sohu’s Sogou and Shanda’s Groupon: Barking Up the Wrong Trees

A couple of weeks after reporting my amazement at a $1.5 billion foreign investment in e-commerce site 360Buy (previous post), one of the investors is finally speaking out to defend the move. A top exec at Digital Sky Technologies (DST), the Russian firm whose investments include a major stake in Facebook, is saying in a local interview he thinks 360Buy may be worth about $10 billion, which should give everyone an idea of how much the group got for its $1.5 billion investment. (Chinese article) In fairness, 360Buy, which hasn’t given any financials, has a solid reputation in China and is certainly an e-commerce leader. But let’s take a look at the competition: Sure, Baidu (Nasdaq: BIDU) and Tencent (HKEx: 700) have become darlings of investors, who have given them sky-high valuations and meteoric market caps in the $30-$40 billion range. But after those, most top Chinese Internet firms, including leaders like Sina (Nasdaq: SINA), NetEase (Nasdaq: NTES) and Shanda (Nasdaq: SNDA), have been stuck in the $6-$8 billion range for quite a while. So, is 360Buy really worth $10 billion? We’ll have to see some financials before we can give a better answer, but I predict the numbers will ultimately disappoint and investors will be reluctant to reward the company with valuations like those for Baidu and Tencent.

Bottom line: DST made a smart investment in Facebook, but its 360Buy investment is overly optimistic and will yield much lower returns.

本 月早些时候，我对京东商城获得海外15亿美元融资感到诧异，如今主要投资方之一终於站出来谈论此项投资的合理性。俄罗斯投资公司DST高管称，他认为京东 商城价值约100亿美元。京东商城未曾公布过财务数据，不过公平地说，在中国大陆口碑还不错，堪称电子商务巨头。但我们不妨看看其它竞争者的情况：百 度<BIDU.O>和腾讯<0700.HK>成了投资者的宠儿，市值达到三四百亿美元。但除此之外，中国多数顶尖互联网企业，包 括新浪<SINA.O>，网易<NTES.O>和盛大网络<SNDA.O>，市值均徘徊於60-80亿美元。因此， 京东商城真的价值100亿美元吗？我们恐怕先得看看财务数据，才能更好地判断。但据我推测，其财务数据最终将令人失望，投资者对其估值将远远无法媲美百度 和腾讯。

一句话：DST当初投资Facebook是明智的，但这次投资京东商城恐怕是太过乐观了，得到的回报会低得多。

Related postings 相关文章:

◙ 360Buy — Are They Really Worth That Much? 京东商城——真值那么多钱？

◙ Renren Takes Lead Over Kaixin With Blockbuster Filing 人人网：风风火火IPO 气势盖过开心

◙ Facebook’s China Tie Up: No Big Deal Facebook能否入华？

Huawei Technologies 2010 results are just out, and while they might make more established companies like Ericsson (Stockholm: ERICb) and Nokia Siemens Networks jealous they certainly aren’t all that exciting. The company saw 2010 profit and revenue rise 30 percent and 24 percent, respectively — respectable numbers but not nearly as exciting as some of the explosive growth we’ve seen in the past. (English article; Chinese article) Hidden in the detailed report was the intriguing assertion that Huawei wants to add more profitable IT services to its portfolio in a bid to keep its growth going. I use the word “intriguing” because, to the best of my knowledge, none of Huawei’s rivals in either the networking equipment or cellphone spaces have taken this route. My guess is that networking equipment is too specialized for such services, while cellphones are too consumer oriented. That said, Huawei’s foray into this venture seems destined to face a tough road ahead, and in the end it will probably have to abandon the effort and look for other new areas for growth.

Bottom line: Huawei’s foray into IT services will end up a disappointment, with the company facing a future of slow growth as its traditional hardware businesses mature.

华 为刚刚公布2010年财报，虽然足以令爱立信<ERICb.ST>和诺基亚西门子网络艳羡不已，但其实也不算多么振奋人心。华为2010年利 润和营收分别增长30%和24%，算是业绩不俗，但与过去爆炸式增长相比，不过尔尔。华为希望加强利润率更高的IT服务领域，以保持高速增长。我觉得很好 奇，因为据我了解，华为无论是在网络设备领域还是手机领域的竞争对手，都未尝试这样的模式。我猜，这大概是因为，对IT服务来说，网络设备领域太过专业 化，而手机业务又太以消费者为导向。因此华为的这个尝试必将困难重重，最终可能不得不放弃，另辟新的增长领域。

一句话：随着华为传统的硬件业务趋於成熟，华为未来面临增长缓慢的风险，而华为进军IT服务领域的尝试，可能以失望告终。

Related postings 相关文章:

◙ Motorola, Huawei Settle, Now Everyone Can Move On 华为与摩托罗拉和解，各方均受益

◙ ZTE, Huawei Stumble Some More 华为中兴：难兄难弟

◙ Huawei: Strength in Separation? 华为：大胆尝试“本土化管理”

As names like Renren, Kaixin and Netqin fill the radar screen of China Internet investors, another company — mobile search firm Easou — is quietly making smaller headlines as another up-and-comer to watch. Local media report the company, whose founding in 2005 makes it one of China’s first mobile search firms, has recently received $50 million in new venture funding from a group that includes Taiwan chip giant UMC (Taipei: 2303) and France’s Ventech, and is looking to list as soon as 2013 when it expects annual revenue to breach the 1 billiion yuan mark. (English article; Chinese article) While it’s far from certain that Easou will remain the leader in this space two years from now, especially with companies like traditional search leader Baidu (Nasdaq: BIDU) taking their own initiatives, Easou certainly looks like an interesting proposition. After all, any company that even thinks it could reach the 1 billion yuan revenue mark just seven years after its founding must be doing well, and could easily hold on to its position as China’s mobile search leader if it makes the right moves.

Bottom line: Easou is well positioned to hold its leadership position in the mobile search space, but needs to make the right moves to fend off potential rivals like Baidu and Tencent.

人人网、开心网、网秦公司等正受到中国互联网投资者的密切关注，此时另一家公司–移动搜索企业宜搜–也在悄悄崛起。中国媒体报导称，成立於2005年 的宜搜近日获得5000万美元风投资金，投资方包括台湾芯片企业–台联电(2303.T)、法国风投公司Ventech等，且宜搜计划最早2013年上 市，该公司期待届时年收入突破10亿人民币大关。眼下，传统互联网搜索企业，如百度等正对进军移动互联搜索领域跃跃欲试，两年内宜搜能够保持行业领先地位 还远未可知，不过宜搜看起来处於比较有利位置。毕竟，任何企业敢想象仅成立七年之际营收就突破10亿大关，那他们目前的业务必定异常出色，且如果不出昏 招，必可轻易守住移动搜索领域的领导地位。

一句话：宜搜对於守住移动搜索领域龙头地位形势看好，但它需要决策无误才能抵御百度、腾讯等潜在对手。

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After reporting last week about the race to market between Chinese social networking sites Renren and Kaixin Wang (previous post), Renren appears to have taken the early lead by filing for an IPO worth up to $500 million — likely to be China’s biggest Internet listing of the year. (English article; Chinese article) Clearly Renren’s more established status, coupled with support from Japan’s Softbank, one of Renren’s largest investors, is pushing this one to market more quickly than younger and less nimble Kaixin. In my last posting I said the winner of this race would get a big premium as China’s first social networking site to list, but in fact the winner would be the world’s first such major site to go public, beating out even global leader Facebook. That makes the race even more interesting, and the stakes even higher if Renren gets there first. Media reports say Renren lists Internet giants Baidu (Nasdaq: BIDU) and Tencent (HKEx: 700) as rivals, but it seems to have largely forgotten Kaixin. Talk about downplaying the competition. Given its longer history, better global connections and status as first to make a public filing, it looks like Renren has gained an early lead in this race.

Bottom line: Renren has an  early lead in its race to market with Kaixin, positioning itself to earn a massive premium for its investors if it becomes the world’s first major SNS to go public.

上周曝出人人网、开心网竞相上市後，人人网已经提交了五亿美元IPO申请，目前似乎领跑一个身位，有可能成为年度最大规模的中国互联网企业上市案例。显然，人人网地位更稳，比之成立时间相对较短、且灵活度较低的开心网，人人上市走得更快。我在之前的文章中说过，这场比赛的赢家将成为中国首个上市的社交网络企业，因此可以在IPO时取得较大溢价，但事实上赢家还能赶在全球头号社交网络Facebook之前，成为全球首家上市的社交网络企业。这样一来，这个比赛有更有看点了，如果人人领先一步上市，其得到的回报也会更高。根据媒体报导，人人网将互联网巨头百度与腾讯视为竞争对手，但似乎已不太重视开心对其的威胁。考虑到人人网创立时间更久、全球关系更好且首先提交上市申请，看来人人网在比赛刚开始就获得了领跑优势。

一句话：人人网、开心网上市大PK，人人网起跑抢占上风。如果最终成为全球首家最先上市的社交网络企业，人人网将会为投资者争得巨大溢价。

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◙ Renren Vs Kaixin: Who Will Get There First? 开心网PK人人网：谁能抢先上市？

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