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Roundup: China Portal Websites Still in a Mess
SINA, world's largest Chinese website, closed its price on Nasdaq at US $ 1.60 in the morning of August 16, a 3.75 percent cut as against last trading day, topping No.1 among China's four portal websites in stock drop margin.
Just prior to the day, August 15, SINA announced its 2001 financial report. Though the report does not scare away all its investors, it neither pleases the investors.
Maybe because of the possible false account problem Netease has postponed its time to release the second quarter financial report.
In spite of the fact that SINA has an operation proceeds two folds over that of Sohu's, its net loss tops US $ 8.2 million, nearly 2.5 times that of the latter. SINA has US $ 110 million left on hand and Sohu has US $ 54 million, but it may be slightly feebler than Sohu in terms of its survival ability.
Especially in revenue growth, SINA also lags behind Sohu. In revenue growth rate, SINA has suffered a 5.74 percent slump while Sohu gained a growth of 17 percent.
Although SINA still holds that over half of Chinese companies would choose SINA as their online ads provider, it is just as the same with Yahoo, which, according to Nasdaq, is attributed to too much leaning on online ads to make money. In such a singular way, SINA also follows suit. While Sohu has successfully lowered its online ads revenue to 77 percent by introducing traditional economy.
SINA is turning itself into China's Yahoo, however, not the likely candidate Sohu, we can not help but say it is a satire for SINA.
But when taking it for granted that SINA's position is to be replaced by Sohu, it is still too early. SINA has strengthened its service in paid e-mail, ads and short message. Just as Wang Yan (SINA's current president) said, what SINA needs to do is first of all to do all its possibilities for survival through fierce competition then to consider it is a IT company.
Some SINA personages at management level are still in thought about SINA's missing a good opportunity when stock price rose high, but objectively speaking, SINA has not fallen into the irretrievable degree. If SINA can cooperate with traditional media or traditional industry, it still can do better and have a promising prospect.
Due to impacts of false financial statements Netease's stock price has slumped to US $ 0.8, and in view of current conditions, Netease has lost courage to develop independently. But if Netease's existence is neglected it would be a great mistake.
Insiders say that the biggest threat to SINA and Sohu is not Deng Lei's (Netease's founder) continuation but a merger by stronger enterprises. Likewise, when Netease comes to be purchased by large operators such as China Telecom, it would be more promising than SINA and Sohu, and by then, China's portal websites pattern will be more bewildering.
By PD Online staff member Li Yan
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