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Renren Rumored to Sell All Unprofitable Services Including the Facebook Clone
It is rumored that Renren is looking to sell all businesses except Renren Games, the only profitable business the company has. All the unprofitable include the Facebook clone Renren.com, the rest of Nuomi Baidu hasn’t taken, and online video service 56.com. Another rumor says the one that will take over all of those is Baidu.
Joseph Chen, CEO of Renren, responded with a post on Renren hinting those rumors are not “reliable”.
Mr. Chen acquired Xiaonei.com, a pixel-by-pixel clone of Facebook, in 2006. Posing as “the Facebook of China” helped it raise $740 million in IPO debut. Display advertising accounted for the majority of the total revenues when Renren went public in the U.S.. Renren claims it’s the largest real name social network in China, but it’s only popular among college students.
Baidu’s acquisition of 59% of Nuomi, a group-buying service, is expected to be closed this quarter. Launched in 2010, Nuomi never turned a profit.
Renren acquired online video site 56.com in September 2011 for $80 million. It’s one of the least expensive deals in China’s online video industry, but it seems the video service hasn’t brought the effect in revenue to Renren as online video did to other players like Sohu.
Renren Games turned out to be the only one under Renren that grew fast and generated profits. Joseph Chen had said at various occasions that Renren Games would go public as an independent company.