WeChat scores a hit in HK, Taiwan but could face resistance in US
I’ve been traveling through Hong Kong, Taiwan and Macau these last few days, so thought I’d end the week with a look at Tencent’s (HKEx: 700) hugely popular WeChat mobile messaging service and the challenges it faces in its quest to go global and commercialize. I’ve been quite surprised by how widespread WeChat, known in Chinese as Weixin, has become in all 3 of these Chinese-speaking areas. But at the same time, comments from one of my industry friends also indicate Tencent could face an uphill battle winning acceptance in the US, where it could face heavy competition from rival products and skepticism due to its China connections. New media reports also indicate WeChat’s hyped new relationship with China Merchants Bank (HKEx: 3968; Shanghai: 600036) may also be running into problems, indicating the road to commercialization may not be as smooth as Tencent had hoped. Read Full Post…
Just a couple of weeks after US delivery giant UPS (NYSE: UPS) unveiled a major plan to expand its China logistics infrastructure, private equity firm Carlyle is announcing an even larger $400 million venture to tap the nation’s booming e-commerce market. These 2 mega investments could well be followed by similar plans from both domestic and international firms, resulting in a multibillion-dollar spending spree over the next few years on new warehouses and other logistics facilities to help speed the delivery of goods ordered online to users’ homes and offices. Read Full Post…
A new report on the explosion of e-commerce in China seems like a good opportunity to take a broader look at the sector and its longer term potential, including which players are likely to emerge as the big winners over the longer term. The latest figures indicate the potential of e-commerce in China is huge, meaning we could ultimately see 2 or 3 major players succeed in the market. But that also means we’re likely to see at least 3 or 4 casualties in the current battle for supremacy, since the field of major, well-funded contenders current numbers around 6 or 7. Read Full Post…
The following press releases and media reports about Chinese companies were carried on August 30. To view a full article or story, click on the link next to the headline.
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Carlyle, Shanghai Yupei To Invest $200 Mln On China Logistics Warehouses (Businesswire)
Sina (Nasdaq: SINA) Acquires Online Literature Site Xuan Guoke – Source (English article)
I’m calling today “legal Thursday” following word of a series of shareholder lawsuits against state-run oil giant PetroChina (HKEx: 857; Shanghai: 601857; NYSE: PTR) and e-commerce firm LightInTheBox (NYSE: LITB), whose shares have both dropped sharply in the last 2 weeks. These lawsuits may just be the first in what’s likely to become a bigger wave of similar actions by law firms that will accuse the companies of hiding information that led to their share declines, costing investors millions of dollars. In particular, we could see a flood of similar share plunges and lawsuits at other major publicly listed state-run firms if Beijing continues its recent campaign to root out rampant corruption at many of these companies.
Perhaps struggling former global PC leader Hewlett-Packard (NYSE: HPQ) has finally straightened its house, or perhaps it senses that rival Lenovo (HKEx: 992) has become distracted with its recent push into smartphones. Whatever the reason, HP appears to be gearing up for a new push into China, with its announcement of a newly created China chairman position which is being filled with a tech industry veteran. Such a move implies an overhaul of HP’s China operations, and is certainly long overdue for a company whose share of China’s PC market has dropped sharply in the last few years. But the move also looks like too little too late, amid a global trend that has seen PC sales fall sharply due to the rising popularity of smaller devices like tablet PCs and smartphones. Read Full Post…
In the latest signal of the growing popularity of Internet TV, leading search engine Baidu (Nasdaq: BIDU) is reportedly preparing a tie-up in the space to promote its iQiyi online video service with top domestic TV maker TCL Multimedia (HKEx: 1070). The rapid growth in this area over the last year has been quite interesting to watch, as a number of major private companies have been piling into the space with new Internet-based offerings in a bid to challenge China’s notoriously slow and uncreative traditional TV sector. Read Full Post…
The following press releases and media reports about Chinese companies were carried on August 29. To view a full article or story, click on the link next to the headline.
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Chinese Shoppers Set To Become World Leaders Online (English article)
Suntech (NYSE: STP) Announces Director Resignations and Election of New Chairman (PRNewswire)
PetroChina officials fall victim in anti-graft campaign
An anti-corruption drive centered on firms in China is quickly moving into the state-run sector, with word of a major probe at PetroChina (HKEx: 857; Shanghai: 601857; NYSE: PTR) that has snared some of the oil giant’s top executives. Before I go any further, I need to admit that this new twist shows that I was wrong in my earlier observation that the growing wave of anti-corruption probes was mainly targeted at foreign firms. I still contend the campaign began with foreign companies, which are generally easier targets for Chinese investigators; but now the clean-up appears to be spreading into the much larger state-run sector, where investigations are much more difficult because many suspects are protected by their vast networks of government and other connections, known as guanxi. Read Full Post…
Software security specialist Qihoo 360 (NYSE: QIHU) is pouncing on a recent rally in its shares to announce a massive new bond offering, becoming the latest in a select group of top Chinese tech firms to raise big new funds as investor enthusiasm returns to the sector. Following its announcement of upbeat earnings earlier this week, Qihoo has followed with word of the plan to offer senior 5-year notes worth $600 million. To put things in perspective, that amount is equal to more than 6 percent of the company’s market value, which is already quite inflated after Qihoo’s shares have nearly quadrupled over the last year. Read Full Post…
Up-and-coming smartphone maker Xiaomi’s recent campaign to distance itself from previous role model Apple (Nasdaq: AAPL) is gaining momentum, with word that it’s preparing to launch a game console. Industry watchers will know that Xiaomi’s charismatic founder Lei Jun has enjoyed seeing his company compared to Apple for most of the last 2 years, and I suspect Lei also considers himself as the equivalent of a Chinese Steve Jobs. But with Jobs no longer in Apple’s life and Apple’s own fortunes plunging sharply in China this year, Lei seems to have suddenly lost interest in his former role model. Read Full Post…
