Bottom line: Unicom is likely to choose all 3 of the BAT companies as equity and strategic partners under Beijing’s pilot program to invigorate big state-run companies, but none of the tie-ups will produce meaningful results.
Unicom eyes BAT partnerships
China Unicom (HKEx: 762; NYSE: CHU), the perennial laggard among China’s 3 major telcos, is reportedly looking for new life by tying up with the nation’s big 3 Internet companies, Tencent (HKEx: 700), Alibaba (NYSE: BABA) and Baidu (Nasdaq: BIDU). I might normally say “so what?” to this particular development, since it seems like Unicom and its 2 fellow state-run telcos are regularly announcing this kind of partnership, always with little or no meaningful impact on their business. Read Full Post…
Bottom line: Telefonica is likely to finalize its divorce with Unicom in the next 2 years, following the latest halving of its holdings in its Chinese partner to 1 percent as part of a sell-down of non-core assets.
Telefonica dumps more Unicom shares
For some reason that’s not completely clear to me, Spanish telco Telefonica (Madrid: TELF) doesn’t want to admit that its decade-long marriage with China Unicom (HKEx: 763; NYSE: CHU) was a dud and is headed for divorce. That’s my latest assessment, following reports that the Spanish carrier has further sold down its stake in its Chinese partner, leaving it with a miniscule 1 percent of Unicom’s shares. This particular sale was probably driven mostly by a need for cash. But I really don’t understand why Telefonica didn’t just completely dump the rest of its shares and finally end this marriage that never produced anything useful for either side. Read Full Post…
Bottom line: LeTV will announce the launch of a new smart TV and video services in the US during the Consumer Electronics Show in last Vegas next month, but the foray will end in failure due to inexperience and fierce competition.
LeTV goes to CES
China’s LeTV (Shenzhen: 300104) looks set to launch its trademark smart TVs and affiliated video service in the US, a move that would make it the first Chinese player to enter a major western market. In this case LeTV is making lots of noises that point to such a move, though it hasn’t officially announced anything just yet.
The company is preparing to attend the massive Consumer Electronics Show (CES) in Las Vegas next month for the first time, providing the perfect venue for such an announcement. The other major signals for such a launch come from LeTV’s own recently launched US online mall, lemall.com/us, whose product offerings include a $799 smart TV that is currently not available but “coming soon”. Read Full Post…
Bottom line: LeTV could be a company to watch as it embarks on a global expansion, drawing on a savvy business model that sells smart TVs and smartphones at low prices in exchange for video subscription contracts.
LeTV makes cryptic debut at trade show
A major telecoms show happening this week in Spain was filled with small bits of news, but one of the biggest surprises came when I stumbled on an area decked out with signage for the racy online video firm LeTV (Shenzhen: 300104). So far as I could tell, none of the company’s many rivals like Youku Tudou (NYSE: YOKU) and iQiyi were at the show, and even global leader YouTube was absent. That’s not hard to understand, since the Mobile World Congress taking place in Barcelona is a telecoms show whose main attendees are telecoms equipment and smartphone makers. Read Full Post…
Bottom line: Qihoo’s apparent attempt to unify its various products around the 360.com brand looks smart strategically, but it needs to improve its search and cellphone businesses to win back investor interest.
Qihoo pays record for 360.com domain
I’m not usually someone to write about publicity stunts, but one such new ploy by struggling security software maker Qihoo 360 (NYSE: QIHU) has piqued my interest as it hints at some major new strategic moves. The actual news is quite straightforward, saying Qihoo has paid a record $17 million for the 360.com web domain. This news was almost certainly leaked by Qihoo, since companies pay large sums for domains all the time and the news never makes big headlines since it is kept private. That hints that Qihoo may have big plans for 360.com, most likely as a platform to unify its current stable of domains and brands. Read Full Post…
Bottom line: Telefonica’s sell-down of its Unicom stake presages an exit from the investment next year, ending a decade of failed tie-ups by foreign telcos looking to tap the Chinese telecoms services market.
Telefonica halves Unicom stake
Chinese telco shares may look like a good bet for small investors hoping to profit from company stock gains, but they’re a clear dud for foreign carriers hoping to profit from China’s huge but highly protected telecoms market. That’s my latest assessment following word that Spain’s Telefonica (Madrid: TELF) is further selling down its stake in China Unicom (HKEx: 762; NYSE: CHU), in what looks like a prelude to a complete exit from this problematic investment.
If Telefonica does indeed completely dump Unicom, it would mark the end of a decade-long courtship that saw some of the world’s top telcos invest heavily in their Chinese counterparts. All of those investments ended in divorce, with the foreign carriers selling their shares when they failed to get any strategic benefits from the tie-ups. Read Full Post…
The following press releases and media reports about Chinese companies were carried on December 5. To view a full article or story, click on the link next to the headline.
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China Issues 4G Network Licences For TD-LTE To 3 Major Telcos (English article)
Disney In China Digital Entertainment Venture With BesTV (Shanghai: 600637) (English article)
It appears that dominant wireless telco China Mobile (HKEx: 941; NYSE: CHL) has discovered a sudden love affair with Pakistan, with word that it’s weighing an acquisition bid to complement its existing operation in the South Asian market. If anyone detects just a tiny bit of sarcasm in my tone, it’s because I find it somewhat amusing that the world’s largest wireless telco is focusing so much energy on such a small market when there are so many more promising ones for its troubled global expansion. Read Full Post…
The following press releases and media reports about Chinese companies were carried on June 1-3. To view a full article or story, click on the link next to the headline.
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Google (Nasdaq: GOOG) China To Resume Online Shopping Search Service – Source (English article)
Lenovo (HKEx: 992) Proposes Offer Of Dollar-Denominated Debt (HKEx announcement)
China Mobile (HKEx: 941), Vodafone Withdraw Myanmar License Bid (HKEx announcement)
Banks Said To Lend China’s Shuanghui $7 Bln For Smithfield (NYSE: SFD) Deal (English article)
China Mobile (HKEx: 941) New Jego App Eyes WeChat, Overseas Users (Chinese article)
An interesting low-key filing by Telefonica (Madrid: TELF) is leading me to wonder if the debt-laden Spanish telco may be preparing to sell its remaining 5 percent stake in its laggard Chinese peer China Unicom (HKEx: 762; NYSE: CHU). I said last year that such a sell-down wouldn’t surprise me at all, after Telefonica sold about half of its 10 percent in Unicom last June, bringing its holdings to their current levels. Read Full Post…
Dominant Chinese mobile carrier China Mobile (HKEx: 941; NYSE: CHL) has a well established track record for its inability to do much outside its home market, but that could change soon with word that it’s teaming with European giant Vodafone (London: VOD) to bid for a mobile license in Myanmar. I’m often quite critical of China Mobile, as I think this cash-rich but lazy company has done little to take advantage of its huge size and resources to innovate and expand both at home and abroad. But in this case we’re finally seeing an initiative that looks well conceived, giving it a good chance of success as China Mobile looks to move into more competitive global markets.Read Full Post…
