Bottom line: Google should follow the example set by LinkedIn and Apple and be more transparent when it returns to China, and should work with Beijing to forge a more constructive relationship.
Google eyes China return in 2016
One of the strongest signals yet that Google (Nasdaq: GOOG) could soon return to China came late last week, when media reported the company was aiming to open a Chinese version of its Google Play app store next year in accordance with relevant Chinese laws. Such a move would represent an important improvement in the company’s relationship with Beijing, coming 6 years after Google shuttered its China-based search service due to a disagreement on self-policing policies that apply to all sites in China.
The shift is being driven by both sides, amid a realization that they can work together constructively to each other’s benefit. Google’s realizes that China is a market it can’t afford to ignore, with the world’s largest base of 600 million Internet users and 1.3 billion mobile subscribers. Beijing also realizes that a high-tech giant like Google can bring important technology and know-how to the country, whose large stable of smartphone makers already rely heavily on Google’s free Android operating system (OS). Read Full Post…
Bottom line: Baidu could buy a small stake in Xunlei but is unlikely to acquire the company outright as part of their new alliance, while 58.com’s plan to rebuild its newly acquired job site should have good chances of success.
58.com goes to work on ChinaHR
I’ve been predicting a marriage for a while for online video orphan Xunlei (Nasdaq: XNET), even as it remains stubbornly single despite its lack of scale to survive as an independent company. First it appeared the company might get bought by smartphone sensation Xiaomi after the pair boosted their strategic tie-up in May, but then nothing more happened. Now the gossip mills are likely to start turning again, following the latest announcement of a major partnership between Xunlei and Baidu’s (Nasdaq: BIDU) iQiyi online video service.
58.com
Meantime in another Internet news bit, the top executive at leading online classified ad site 58.com(NYSE: WUBA) is saying he will need 2 years to turn around the underperforming online job site ChinaHR, which he acquired earlier this year. His assessment comes after the site laid off nearly all of its staff as part of the deal that saw 58.com buy ChinaHR from its Irish owner. Read Full Post…
Bottom line: A worker rebellion over layoffs at an online recruitment site being bought by 58.com underscores the company’s inexperience at M&A, even though the purchase itself looks like a good move.
Workers rebel over layoffs at ChinaHR
Chinese media are flocking to news that leading online classified ad site 58.com (NYSE: WUBA) has begun slashing jobs at its newly acquired ChinaHR, just days after it announced it would purchase the struggling online recruitment site. The move looks a bit hasty and perhaps extreme, and also comes across as just slightly ironic since many people now losing their jobs may soon have to use rival services to find new work.
But irony aside, this particular story looks quite similar to something that happened just 2 years ago at the very same ChinaHR. In that case workers mutinied and even briefly held an executive hostage after its then-owner, US online recruitment giant Monster Worldwide (Nasdaq: MWW), also tried to lay off employees as part of its own plans to sell the company. If history repeats itself, which is showing early signs of happening, 58.com could be looking at some turbulent times ahead over the next week or two. Read Full Post…
Bottom line: 58.com’s new purchase of an online job site extends its spree of recent acquisitions and partnerships, which looks like a focused, well-conceived plan that could position it to emerge as a leading Chinese Internet advertising specialist.
58.com gets into jobs space
The savvy online classifieds site 58.com (NYSE: WUBA) is back in the headlines as we close out the week, with word that it’s signed a deal to purchase online job specialist ChinaHR. If true, the deal would mark the latest in a steady stream of acquisitions for 58.com, which looks well positioned to become a truly diversified leader in online classified advertising services.
Such a focused strategy looks much better than the more diversified M&A being practiced these days by China’s largest Internet companies, which are all venturing far beyond the core businesses that brought them their initial success. Of course it’s much easier for companies like 58.com to keep their focus due to their small size. Compared to names like Tencent (HKEx: 700) and Alibaba (NYSE: BABA), which are each valued at around $200 billion, 58.com still has a relatively small market value of about $7 billion. Read Full Post…
Bottom line: NetEase’s new California R&D center could become an important hub for its future global growth, while Zynga’s China pull-out reflects the extreme difficulties foreign firms face in the local gaming market.
NetEase opens US R&D center
Just a day after I wrote that online gaming giant Tencent (HKEx: 700) may be planning a major new drive into the US, we’re hearing that its top rival NetEase (Nasdaq: NTES) is also moving into the neighborhood with plans for a new California R&D center. NetEase’s move comes after search leader Baidu (Nasdaq: BIDU) and Tencent both set up US offices last year, though only Baidu actually announced a major new product development center. (previous post) All of these moves represent the Chinese companies’ efforts to tap into the Silicon Valley ethos, which has far more of the skills they will need in their quest to enter global markets outside of China. Read Full Post…
We’ll start off this first day of the new year with what could well become a major theme for 2014, with word that make-up giant Revlon (NYSE: REV) is officially pulling the plug on its China operations. This timing of this move, which was officially announced just before year end, was most likely related to accounting issues, as Revlon probably wants to take some or all of its resulting $22 million write-down in the fourth quarter. But that said, Revlon’s withdrawal shines a spotlight on the tough market for consumer goods in China, as a slowing economy leads many to cut back their spending on non-essential daily items like make-up. Read Full Post…
Some longtime Chinese workers at a Nokia (Helsinki: NOK1V) plant in Guangdong got a rude surprise when they were recently asked to take pay cuts, as the former cellphone giant struggles to halt its rapid decline. But rather than accept the cuts, the workers went on strike to protest the cost-saving measure after Nokia’s recent purchase by Microsoft (Nasdaq: MSFT), a move which could offer the best chance of saving the company. Read Full Post…
The headlines are buzzing today with news that Yahoo (Nasdaq: YHOO) will formally close its China-based email service, in the latest sign that the company may soon withdraw from China completely. Such a move wouldn’t come as a big surprise, since Yahoo’s recently named new CEO has been making some major changes in a bid to revive the struggling former Internet pioneer. One of those moves is likely to see Yahoo withdraw from many of its secondary markets to focus on its core operations in the US. Read Full Post…
The following press releases and media reports about Chinese companies were carried on February 7. To view a full article or story, click on the link next to the headline. ══════════════════════════════════════════════════════
Chinese employees are quickly discovering that working at a major foreign firm doesn’t necessarily guarantee lifetime employment, even when that firm is a top global name like online employment specialist Monster Worldwide (NYSE: MWW). Less than 3 months after announcing plans to exit the China market through sale of its local subsidiary, ChinaHR, Monster is quickly discovering that many of its Chinese employees hardly expected that they could ever be laid off and are refusing to accept the company’s plans to offer them severance packages. (English article)
I’ve always wondered whatever happened to online job site ChinaHR since its purchase in 2008 by US industry leader Monster Worldwide (NYSE: MWW); now I have my answer with new reports that the tie-up has been more or less a failure and that Monster plans to sell its main China asset. This latest disaster shouldn’t come as a huge surprise to anyone, since Monster follows a long list of much better known US web giants that have also tried and failed in China, including Google (Nasdaq: GOOG), Yahoo (Nasdaq: YHOO) and eBay (Nasdaq: EBAY).
Chinese employees are quickly discovering that working at a major foreign firm doesn’t necessarily guarantee lifetime employment, even when that firm is a top global name like online employment specialist Monster Worldwide (NYSE: MWW). Less than 3 months after announcing plans to exit the China market through sale of its local subsidiary, ChinaHR, Monster is quickly discovering that many of its Chinese employees hardly expected that they could ever be laid off and are refusing to accept the company’s plans to offer them severance packages. (
I’ve always wondered whatever happened to online job site ChinaHR since its purchase in 2008 by US industry leader Monster Worldwide (NYSE: MWW); now I have my answer with new reports that the tie-up has been more or less a failure and that Monster plans to sell its main China asset. This latest disaster shouldn’t come as a huge surprise to anyone, since Monster follows a long list of much better known US web giants that have also tried and failed in China, including Google (Nasdaq: GOOG), Yahoo (Nasdaq: YHOO) and eBay (Nasdaq: EBAY).
