Chinese online video and TV operators are making strategic investments, as the market looks set to explode.
Sina (via Tudou)
The massive Sina portal operator (which itself is Nasdaq-listed) has now bought a second stake in a month in the site, which raised $174 million by floating in New York in August. Sina (NSDQ: SINA) has now spent a combined $66.4 million for a total 9.05 percent of Tudou. Via SEC.
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Tencent (via Youku?)
Reports this month have speculated Tencent, which operates the very popular QQ messaging service and uses the same name for its video services, may make its own investment in Youku, which itself raised $202.85 million from its Nasdaq float back in December.
Now Tencent is ready to spend “hundreds of millions of yuan” on a massive nationwide content delivery network (CDN) and on creating and buying original licensed content including dramas, reality contests, business, entertainment, sports, games, fashion and cars, according to TechNode
Sohu
Sohu, another big portal, is by no means out of the game, but is playing a slightly different tactic. “TV.sohu.com has given up the arrogance of exclusive network copyright,” writes China Economic Net. “After obtaining the network copyright of New Princess Pearl, a hot TV play that was being broadcast on Hunan Satellite TV, TV.sohu.com distributed it to Youku.com, v.qq.com, and LeTV.com.”
Sina has only 3.1 percent of the local online video market by revenue, and Tencent doesn’t figure, according to Analysys International.
Both Tudou and Youku may have raised money through Wall Street lately - but but their post-float share prices have been sinking.
Ahead of any Tencent deal, Youku is pressing on under its own steam. In its latest deal, it has gained DreamWorks Animation SKG’s license to show the Kung Fu Panda movies online in China - the animation studio’s first ever such license. Youku is placing the movies through its Premium subscription service and, after their paid window ends, for free on its Hollywood Movie Channel. Via release.
Meanwhile, Xunlei, a video service that is underpinned by a media downloading network and in which Rupert and Wendi Deng Murdoch have invested, this summer postponed its own Nasdaq IPO.