There are the usual reasons big companies might buy one of the leaders in the space, like Toodou, Yoqoo, 56.com, or mofile: they don't know the technology or market as well as the startups, burn rates are low, to get more entrepreneurial leaders into the upper-middle ranks, to buy a recognizable brand, to add stickiness to existing services, etc.
For Baidu.com, Inc., acquiring one of China's many YouTube clones would make sense for the above reasons, plus the fact that Baidu engineers could then optimize the acquired site for Baidu search, something that none of the Chinese video startups seem to have done very well on their own.
It would also makes sense for News Corp.'s MySpace unit, which does not have a presence in China, to buy a video community company, after a long line of Internet giants -- the most recent being Google Inc. have shown how tough it can be to dislodge a local competitor.
The Wall Street Journal reported that Myspace is getting help from Boston-based venture capital group IDG in its China-entry, which brings Toodou, Qihoo, Pica and a bunch of other early stage Chinese companies squarely into the rangefinder.
Sina Corp , Baidu, Alibaba, and especially Tencent could easily fire up video-sharing services that steal a huge chunk of users from all of the top YouTube clones in China within a few months. Chinese Internet users' stickiness has been proven to have limits, after all. To wit: 40% Yahoo owned Alibaba's Taobao service pillaged eBay China's user base in an astonishingly short time.
With a user base that is within the same ballpark as the overall Internet population of China, Tencent's "QQ" instant messaging application has the power to elevate a new online game into the top 10 from a standing start, or make a movie of my dog trying to dig a hole back to America into the most viewed home video of all time.
The Coca-Cola Co. has just signed up to sponsor Tencent's "QQ Pig" virtual pet in 2007, the Year of the Pig. I would wager they paid a hefty sum for the privilege, and that the exposure will be worth every QQ coin.
Tencent has already launched a personal video sharing service, and I will be interested to see how it develops. If it's like most other services the company has introduced, before we even notice anything changing the entire match will have already been played.
Oak Pacific Interactive bought Uume, one of China's early social networking sites that used video-sharing as a hook, but has apparently decided not to try to promote the video-sharing service because of all the competition in the sector. Oak has since slashed staff of its Uume unit down to a handful.
Any of the "2.0" style sites that don't have a rock-solid hold on its users will probably see them sucked away by China's big Web sites. If they have their users well-hooked, and if they play their cards right, they have a chance to build the next major Internet company in China.
That, of course, is what the venture capitalists who have been chasing Web 2.0 valuations into the troposphere will tell you: China's Internet is all about community -- nobody cares how great your technology is, just get users to find enough value in the interaction you provide and you are half-way to an IPO.
Source:佚名