Charles Chao, chief executive of Chinese portal service Sina, told analysts in the conference call following its Q3 financial results that the company would consider acquiring into other areas – especially mobile Internet. According to the company’s latest results, its net revenue increased 21% year-over-year to US$ 184.6 million while net income grew by a whopping 157% year-over-year to 25.4 million.
The numbers all look good but there’s always more than meets the eye. The fact behind the rosy financial statement, is that Sina’s non-ad revenue increased only 4% year-over-year, the company itself must have recognized the imperative to look into opportunities in other areas in addition to ad sales, which is declining on desktop-side.
Charles revealed that since the company does “have quite a bit of cash reserves”, they’re looking to acquire in different areas, such as mobile internet and new media areas. Sina is actively looking to see if they can achieve business growth over the long term by such expansion.
And games, especially mobile games, obviously would be among the top priorities for Sina. In this quarter Weibo value-added service which primarily include revenue share from Weibo games and Weibo membership fees grew 121% year over year to 9.7 million. Weibo VAS (value-added services) represented the main growth of the season. Sina probably had seen the uptake of of its game business and already made some investments in this area. For example, the Beijing-based company was said to be in talks with a startup making a toolbox for gamers. And in this August Sina bid a domain name 97973.com for RMB tens of millions yuan and modeled it into a gaming info site.
At the same time, Sina has its own alternative to WeChat, dubbed WeMeet. It’s just the service never made much noise in comparison to NetEase/China Telecom’s EasyChat or Alibaba’s aspirant Lai Wang.
Currently, Weibo games are still browser-based and as more and more traffic are shifting from desktop to mobile end, Sina has to quickly find a way to integrate mobile game titles into its over-the-air traffic and squeeze revenue out of it.