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PPTV Finally Finds Buyer In Suning

By newsdoug on October 29, 2013

PPTV links up with Suning, Hony

After shopping around for an investor for much of this year, money-losing video sharing site PPTV has finally found a new patron in retailing giant Suning (Shenzhen: 002024). I’m quite happy to see this latest development in China’s rapidly consolidating online video space, as it means I can finally stop writing about all the latest rumors that have popped up for the last 6 months surrounding PPTV. Rumors of this particular tie-up first emerged about a month ago (previous post), and I’ll admit that this deal doesn’t look particularly attractive to me. Read Full Post…

Beijing Crackdown Boosts Legal Video

By newsdoug on May 2, 2013

Beijing cracks down on pirated video sites

A new crackdown on Chinese websites that traffic in pirated material is coming as welcome news to China’s struggling online video sharing sector, where companies are still struggling to find success in a tough market. But while it’s easy to blame the pirates for their woes, China’s money-losing video sharing sites are also simply victims of choosing a sector where earning profits is extremely difficult if not impossible. That reality is reflected in the fact that sector pioneer YouTube still struggles to earn money, even some eight years after it was first established. Read Full Post…

Youku, Tudou: No Honeymoon Ahead 优酷与土豆“婚”後将无蜜月可度

By newsdoug on August 21, 2012

The proposed marriage between Youku (NYSE: YOKU) and Tudou (Nasdaq: TUDO) looks like a done deal, with shareholders of both companies approving the union at separate meetings on the same day. (Youku announcement; Tudou announcement) So now the question becomes: what does the union mean for the longer term development of the new company, Youku Tudou, and also what does the formation of this new industry leader mean for other major players? In a nutshell, I honestly don’t think the future looks very bright for anyone, due to both individual company issues and broader industry issues as well.

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Tudou, Youku Merger Moves Ahead as Growth Slows 随着增长放缓，优酷、土豆合并有进展

By newsdoug on August 6, 2012

Despite my previous view that the merger of Tudou (Nasdaq: TUDO) and Youku (NYSE: YOKU) might be running into trouble, the marriage of China’s top 2 video sharing sites does look set to close later this month, even as the latest earnings from Tudou show that growth of its core advertising business is slowing rapidly. Based on what I’ve been hearing since my previous prediction that the deal could run into trouble, I still see potential problems ahead for this unlikely pair due to very different management styles of their 2 leaders.

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Ku6-YouTube Tie-Up: China Hype Alive and Well 酷6网和YouTube合作恐难成正果

By newsdoug on January 18, 2012

Ku6-YouTube tie-up looks empty I want to start today with a silly story that shows that despite the recent confidence crisis for US-listed Chinese stocks, anyone with a good China story to tell can still earn a fast buck on Wall Street. The story I’m referring to involves battered video sharing site Ku6 Media (Nasdaq: KUTV), which has announced a tie-up with YouTube that will see the global giant start a new channel to bring Ku6’s content to a global audience. (company announcement; Chinese article) The announcement contains no additional details, but that didn’t stop investors from getting excited enough over a good China story to boost Ku6’s Nasdaq-listed shares by a whopping 140 percent on Tuesday. Cynics like myself will note that even with the jump, Ku6 shares are still at less than half of their highs from last May, when a broader sell-off began for US-listed China stocks due to a series of accounting scandals. Let’s sit back and think about this new deal for a minute. Sure, YouTube is a huge name in online video and there are certainly plenty of people outside China who might be interested in watching more China-generated content. But nowhere in Ku6’s announcement is there any mention of exclusivity, and if this tie-up is even remotely successful I suspect YouTube will quickly start looking for more China partners with bigger content libraries, such as Youku (NYSE: YOKU) and Tudou (Nasdaq: TUDO), which undoubtedly would be happy to enter into such alliances. What’s more, Ku6 is a company with a bit of an identity crisis, having undergone a number of major changes in its management and strategic direction over the past year at the instigation of its fickle controlling shareholder, Shanda Interactive (Nasdaq: SNDA). In fact, I strongly suspect this new announcement is the work of Shanda founder and chairman Chen Tianqiao, who has proven himself a master at making headlines that sounds exciting but mostly lack substance. At the end of the day, I seriously doubt this new tie-up will rescue Ku6, although it could theoretically become a more attractive takeover target for one of its larger rivals. At the end of the day, all this just shows that western investors will always love a good China story, regardless of how much substance it has — or lacks.

Bottom line: A new tie-up between Ku6 and YouTube will bring minimal benefits to Ku6, but a huge jump in Ku6 stock shows that western investors will always love an good China story.

News Digest: January 18, 2012

By newsdoug on January 17, 2012

The following press releases and media reports about Chinese companies were carried on January 18. To view a full article or story, click on the link next to the headline.

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◙ ZTE (HKEx: 763) Aims to Pass Rival Huawei in Smartphone Sales in China (English article)

◙ China Telecom (HKEx: 728; NYSE: CHA) Targets Sales of 45 Mln Smartphones in 2012 (English article)

◙ New Oriental (NYSE: EDU) Announces Results for Fiscal Q2 Ended Nov 30 (PRNewswire)

◙ Ku6 Media (Nasdaq: KUTV) and YouTube Form Tie-Up, Ku6 Stocks Jumps 139 Percent (Chinese article)

◙ Ming Yang (NYSE: MY) Announces Issuance of Up to RMB 1.0 Billion 3 Year Notes (PRNewswire)

Video Sharing: Let the Tie-Ups Begin

By newsdoug on August 18, 2011

Tencent courts Youku Just a day after Tudou’s (Nasdaq: TUDO) disappointing IPO that saw its shares drop 12 percent on their trading debut (English article), there’s buzz in the market that Tudou’s top rival, industry leader Youku (NYSE: YOKU) is in talks for an equity investment by Chinese Internet leader Tencent (HKEx: 700). (English article; Chinese article) Such a tie-up would bear a remarkable resemblance to Google’s (Nasdaq: GOOG) landmark purchase of global online video leader Youtube several years back, and testifies to the fact that online video is a much better business prospect when it has strong support from a company like Google or Tencent, which can use their wider array of services to steer traffic to these more specialized video sites. The development is also interesting because Tencent itself has already flagged video as a major focus area, pumping hundreds of millions of dollars into a business it hopes will help to jump-start its sputtering growth. (previous post) If and when it happens, such a tie-up will give money-losing Youku, which already enjoys a market cap more than 4 times the size of Tudou, an even bigger advantage in the video-sharing market, providing the clout of China’s top online game and instant messaging service provider. Such a move could leave Tudou, whose chairman Gary Wang has little or no interest in similar tie-ups, no choice but to find its own partner. Rumors of such a tie-up were already rife in the run-up to Tudou’s IPO, with talk that it was seeking investment from leading online search site Baidu (Nasdaq: BIDU), which no doubt would still be interested in such a tie-up. (previous post) Other video sharing sites like Xunlei, which had to abort a planned IPO last month as market sentiment tanked (previous post), could also be forced to search for new tie-up partners if a Youku-Tencent alliance takes shape.

Bottom line: An equity tie-up between Youku and Tencent would throw a new dynamic into the video sharing market, forcing other players to seek similar tie-ups.