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Tag Archives: iQiyi
iQiyi, is China’s leading advertising supported online television and movie portal.
Overview of the expert of Chinese high Tech company expert Doug Young
Bottom line: Alibaba’s new Disney tie-up is unlikely to gain much traction due to overcrowding in China’s Internet video market, while its tie-up to sell $8 billion worth of bad debt from asset manager Huarong looks mildly positive.
Alibaba in streaming tie-up with Disney
E-commerce giant Alibaba(NYSE: BABA) is in a trio of headlines as we head into the year-end holidays, led by a new tie-up with Disney (NYSE: DIS) as it looks to leverage its growing stable of media assets. But in a sign of how much attention the company now attracts, the other 2 stories in the headlines aren’t really ones that Alibaba would care to trumpet too much.
The larger of those is mildly positive, with media reporting that Alibaba’s Taobao C2C marketplace is teaming up with one of China’s leading bad asset sellers to auction off $8 billion in soured loans. The other headline is one that’s becoming a small headache for Jack Ma, and involves Evergrande Taobao the soccer team that he co-owns. That story has one of Japanese car maker Nissan’s (Tokyo: 7201) China joint ventures suing the club for breach of contract related to a high-profile sponsorship dispute. Read Full Post…
Bottom line: Mango TV’s scaled-back new funding reflects the potential and stiff competition in China’s online video market, while Lufax’s Chinese and foreign roots could make it a name to watch in the emerging private financial services sector.
Mango TV nears $1.5 billion funding
Two fund-raising deals likely to be among China’s largest next year are in the headlines as we close the week, led by a major paring back of plans by upstart online video company Mango TV. The other news is shedding more light on aggressive expansion plans by Lufax, another upstart in the peer-to-peer (P2P) lending space, which is in the process of seeking $1 billion in new funds.
Let’s jump right in with the Mango deal, which is reportedly close to wrapping and will see the company raise $1.5 billion. (Chinese article) I’m admit I’m not completely sure that the figure is US dollars, as the Chinese report doesn’t specify if it’s dollars or Chinese yuan. But the US dollar figure is more consistent with reports last month, which said Mango was seeking to raise up to 20 billion yuan, or about $3.2 billion in its second funding round. (previous post) Read Full Post…
Bottom line: Xiaomi’s newest product launch focused on cheap smartphones and LeTV’s scrapping of an IPO for its film-making unit reflect fading prospects for these former superstars due to stiff competition.
Xiaomi rolls out more bargain phones
Former Chinese superstars Xiaomiand LeTV (Shenzhen: 300104) are in the headlines with new setbacks, reflecting the meteoric rises and equally fast falls that China is producing in its own version of the dot-com bubble. But this bubble has distinctly Chinese characteristics, and is coming in a more mature Internet where rampant competition and copycatting make it very difficult to make profits.
The first headline has Xiaomi rolling out 3 of its newest smartphones that are decidedly low-end, representing a big setback for the company’s drive to produce higher-end models that have fatter profit margins. The second headline has LeTV scrapping a plan to make a separate listing for its filmed entertainment unit, a year after hyping a new IPO that it hoped could mimic the meteoric rise in its own stock earlier this year. Read Full Post…
Bottom line: Chinese video- and entertainment-related companies will continue to attract big investments and valuations over the next year due to their strong growth potential, even as sentiment cools towards other new media companies.
Mango TV eyes major new funding
Investor sentiment may be rapidly cooling towards many Internet areas in China, but entertainment is one that still remains quite popular. That’s my latest read on the markets, following news of major new financing for 2 companies and a new Sino-foreign co-production deal in the hot video and movie-making sectors.
Up-and-coming online video operator Mango TV is at the center of the biggest news in terms of value, with media reporting it’s aiming to raise a hefty 20 billion yuan ($3.2 billion) in just its second funding round. Movie ticket booking app Weiying Shidai is in a smaller but still sizable fund-raising headline, with reports that it has just raised 1.5 billion yuan in its third funding round. Last but not least is word of a film co-production deal between local studio Huace (Shenzhen: 300133) and global giant Twenty-First Century Fox (Nasdaq: FOX). Read Full Post…
Bottom line: An aggressive new share buy-back and tie-up between its Qunar unit and former rival Ctrip could indicate a new pragmatism from Baidu chief Robin Li, signaling a potential new era of more realistic spending on its emerging businesses.
Baidu jumps on mixed report
Investors hoping for new signs of restrained spending in the latest results from Baidu (Nasdaq: BIDU) were disappointed, as China’s leading search engine continued a recent spending frenzy that has sharply eroded profits. But that didn’t stop those same investors from bidding up Baidu’s shares after release of its third-quarter results, leading me to believe they’re hoping the spending frenzy may soon start to subside. We saw some signs that may be happening earlier this week, following a landmark tie-up between Baidu’s Qunar (Nasdaq: QUNR) online travel site and former archrival Ctrip (Nasdaq: CTRP).
Despite its frenetic expansion outside its core search business over the last year, Baidu remains largely a one-trick pony, deriving most of its revenue from its core online search business. It has found some success in some newer areas, such as online video, travel services and group buying. But the reality is that those businesses are still quite small in terms of revenue contribution, and all are losing big money as Baidu allows them to spend heavily in pursuit of market share. Read Full Post…
Bottom line: China should expand its plans for a new enterprise board in Shanghai to include a place for the Chinese units of big multinationals like Yum and Uber, allowing domestic investors to buy into these big foreign names.
Calls grow for KFC parent to spin off China unit
Global fast food giant Yum Brands (NYSE: YUM) became the latest major multinational to contemplate a spin-off for its China business last week, following in the tracks of Uber and IMAX (NYSE: IMAX), two leaders in their respective areas of hired car services and big-screen theater technology. The trend acknowledges that China will soon become the world’s largest consumer market, and its unique qualities and complexities often justify creation of separate companies for these big global names to effectively develop the market.
China should seize on this trend and modify its current plans for a new Nasdaq-style enterprise board based in Shanghai to also include a place for these larger, newly created companies with foreign roots. Reports earlier this year indicated the regulator was aiming to roll out the new strategic industries board as soon as next year, though its plans could be delayed due to the recent turmoil on China’s stock markets. Read Full Post…
Bottom line: Baidu’s reported plan to sell its online music unit looks like a smart way to rid itself of a controversial piracy-plagued business that holds little value for its main strategic focuses going forward.
Baidu set to dump music unit?
In what could be a move that’s long overdue, leading search engine Baidu (Nasdaq: BIDU) is reportedly eyeing a sale of a music division that was once one of its major attractions but in recent years has become more a liability due to frequent accusations of copyright violations. Baidu wasn’t commenting on the reports, but such a move would be consistent with its recent diversification into a range of new areas, none of which include music as part of their core business.
Such a deal, if it’s really in the works, probably wouldn’t be worth too much, perhaps in the $100-$500 million range at the very most. More significantly would be the disposal of a unit that in the past has come under fire for allowing rampant piracy through illegal peer-to-peer (P2P) trading of copyrighted music. Read Full Post…
Bottom line: A threat to privatize Baidu by chairman Robin Li is probably the result of frustration at recent declines in the company’s stock and is unlikely to result in a serious buy-out bid.
Frustrated Robin Li threatens Baidu privatization
The biggest privatization threat to date by a US-listed Chinese company has just come from online search leader Baidu (Nasdaq: BIDU), whose chairman Robin Li is joining a growing chorus of executives who say their shares are underappreciated by Wall Street investors. In this case it’s easy to see why Li is unhappy, since Baidu’s stock has lost a quarter of its value since July, when the company reported a spending binge on new businesses had sapped its profits.
Baidu’s shares were actually down by an even greater 30 percent at the start of this week, but surged 6 percent in the latest session amid a broader rally for Chinese Internet stocks. It should come as no surprise that the US surge was sparked by a rally earlier in the day on China’s domestic stock markets, which is where Baidu and many of its other US-listed Internet peers say they would like to re-list. Read Full Post…
Bottom line: A new 1 billion yuan co-production tie-up for iQiyi marks the latest bid by Baidu to build up its new businesses through big spending, but could pressure Baidu’s shares due to shorter-term profit erosion.
iQiyi, Shanghai New Culture in production tie-up
I have to credit Internet giant Baidu (Nasdaq: BIDU) for sticking to its guns with its recent strategy of aggressive spending on acquisitions and tie-ups as the centerpiece of a drive to diversify beyond its core search business. That strategy put a big damper on Baidu’s profit growth in its latest quarterly results, sparking a sell-off that has seen its stock lose more than a third of their value this year.
And yet despite those concerns, Baidu continues to aggressively pour money into its emerging new businesses, many of them companies that are growing fast but are also losing big money. That’s certainly the case with Baidu’s latest investment, which will see it pour 1 billion yuan ($160 milllion) into a new co-production deal between its iQiyi online video unit and a Shenzhen-listed film production house called Shanghai New Culture (Shenzhen: 300336). Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 3-7. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Chmn Said to Plan $2 Bln Loan Against Stock (English article)
Snackmaker Liwayway Said to Prepare $200 Mln Hong Kong IPO (English article)
Apple (Nasdaq: AAPL) Watch China Sales Pass 1.07 Mln – Report (Chinese article)
iQiyi, Shanghai New Culture (Shenzhen: 300336) in 1 Bln Yuan Production Tie-Up (Chinese article)
Xiaomi Accused of False Promotion Claims for Redmi Note 2 (Chinese article)
Bottom line: SMG’s Whaley Tech division has become the focus of its drive into the new media realm, following Li Ruigang’s departure from his post as group chairman to focus on the unit’s development.
SMG chief tries hand at smart TV
I don’t generally hold out much hope for traditional Chinese broadcasters for making the transition to new media, since most are bureaucratic, state-run outfits staffed by an older generation that doesn’t really understand the emerging industry landscape. But 2 companies that have the potential make the transition are Shanghai Media Group (SMG) and Hunan Satellite TV, which are both making big drives into digital products delivered in on-demand formats over the Internet.
Of the pair, my favorite is Hunan Satellite, since the company has a strong track record of innovation that has helped it to build a national audience despite its location in the relatively backward interior Hunan province. But SMG’s longtime chief Li Ruigang is also trying to show he can take his company into the new media era, with word that he’s formally quit as chairman of his group to focus on development of its new media businesses. Read Full Post…
