About this Blog

The purpose of this blog is for my personal use. It serves as my personal diary as I investigate Chinese internet/gaming companies for investment purpose. If you have any comments or disagreement, please give me feedbacks.

Friday, September 14, 2007

Battle of the Olympics, part4 - Conclusion

This is the final part of a 4 part report, the previous part, part 3, is here:


Sina will have 15 reporters while Sohu will have 300 reporters inside the Olympics. Sohu claims it is the only internet company that is allowed inside the Olympics village. It may be half true. Sina probably is not allowed to go directly. But she will get 15 reporters in, probably though indirect channel (such as be part of a team from a traditional TV).

At this point, it is clear that Sohu has the upper hand for the Olympics. Beijing Olympics Committee is on their side. In addition, as long as there are confusion regards to whether companies can use Olympics logos or slogans on Sina, Ntes, or Tencents’ web site, it is to be Sohu’s advantage.

Frankly, I don’t think companies like Dell, GM, Toyota could care less about who is the official sponsor. But if they can put ads on Sohu without any string attached while there may be many hidden restrictions to put ads on Sina, Ntes, and others, it is pretty clear which internet company they will pick.

The longer this confusion lasts, the better it is for Sohu.

Now it is clear that Beijing Olympics Committee is on Sohu’s side, will that be the final nail on the coffin as far as Sina and Ntes are concerned? Not by a long shot.

First, Sina and Ntes will benefit from the Olympics indirectly just by be the 1st and 3rd largest portal in China.

In addition, both of them have powerful friends in the government also. It is one thing that Beijing Olympics Committee gives verbal prohibition, it is quite another matter for the above agency to actually stop what Sina or Ntes will do.

More importantly, if Sina is successful to make the alliance permanent as well as able to share advertisement, Sina will create an entity that is virtually invincible.

Sina (and Ntes) might take its licks from Sohu prior and during the Olympics. But what is Sohu going to do afterward. Sohu definitely can’t compete with a real alliance like the one Sina is proposing.

In a nutshell, I think Sohu is going to win the Olympics battle, but will she lose China’s internet war? Only time will tell.

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