Sina.com Appoints New CEO; Trims Operations Outside
China
Beijing-based Sina.com, one of China’s three leading
Internet portals, announced the appointment of Wang Yan
as CEO, replacing Daniel Mao. It also announced the shutting
down of its operations in Taiwan and Silicon Valley in
the US. Wang Yan, who is 30 years old, said that he would
focus on rejuvenating Sina.com.
Sina.com was formed in 1998 by the merger of Beijing-based
SRS, a software company, and Sinanet, a Silicon Valley
based Chinese-language Internet news portal founded by
three Stanford post-graduate students. At the time of
the merger, the company said that it wanted to build a
new global Chinese community, and would draw revenue from
US Internet advertising, while building traffic in China.
The company made its IPO in April 2000 on the US NASDAQ
market.
However, with the collapse of the Internet advertising
market in the US in late 2000, the company switched focus
to the China (PRC) market, while maintaining operations
in the US, Hong Kong and Taiwan. Eventually, it partnered
with China Mobile in the PRC to provide content services
for mobile phones, and also served as a portal for massive
multi-player games played on the Internet. Most of the
game partners were developers in South Korea and Taiwan,
who wanted to generate revenue from the large number of
Internet users in the PRC market. Unlike in the US, virtually
all online game players in China play on their personal
computers; although the Microsoft X-Box and Sony Playstation
2 are made in China, they are not sold there.
Following the collapse of the US ad market, its operations
in the US, Taiwan and Hong Kong dragged down profits,
even though it was profitable in China. Its two largest
competitors in China, Netease (Nasdaq: NTES) and Sohu
(Nasdaq:SOHU) are already profitable. They do not have
operations outside of the PRC market.
The share prices of all three companies have gone up
approximately 300 per cent in the past six months as they
have reached, or in Sina.com’s case, are close to
reaching, profitability in the PRC market. Recently, they
have benefited from the SARS crisis, as more Chinese spend
more time communicating on their mobile phones, and on
their computers.
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