Exclusive Reporting

Sep 7

Alibaba Finance Group Submits Banking License Proposal to PBOC


A source close to the matter said that Alibaba Finance Group has submitted a proposal to the People’s Bank of China (PBOC) for a license to set up an online bank.  The PBOC is the central bank of China and has the authority to control monetary policy and regulate financial institutions in mainland China. 

Alibaba Finance Group is a new entity that is owned in part by Alibaba Group and other individuals such as Alibaba’s founder, Jack Ma.

The license will allow Alibaba to operate a business that includes deposits, loans and remittances.  

Alibaba Finance Group’s registration was for over CNY 1 billion CNY (USD 163 million) and will be filed in Shanghai or Wenzhou in light of favorable regulatory conditions. The company will focus on small accounts and transaction amounts, though it is anticipated that these small transactions will add up quickly. Alipay’s online sales of money market funds, for example, have already surpassed CNY 50 billion (USD 8.17 billion).

The proposal for the license was submitted to the PBOC on September 6. The source states that, “The official [in charge of] supervising the license approval is ’cautiously supportive.’ However, it will take a long time to win the approval and [the process] involves a few different ministries.” The source also said, “There is a reform plan regarding the rules on allowing private capital to establish an institution in the banking industry. The plan is expected to be announced by the Communist Party during November’s conference.”

A spokesman for Alibaba Group declined to comment on the matter until further information is available.

Aug 23

Alibaba Has Invested Over USD 100 Million in UCWeb


A source close to UCWeb CEO Yu Yongfu disclosed to BrightWire today that Alibaba has invested more than USD 100 million in the company. Following the most recent round, UCWeb reduced its number of board members to five, with Jack Ma holding one seat and UCWeb’s management holding three. The source did not disclose who holds the fifth seat.

 UCWeb is now the leading mobile browser in India, accounting for a 30% market share. The company aims to continue expanding in India, the Middle East and Russia, and has additional plans to enter the US and European markets. UCWeb has already established an office in the US.

 Yu Yongfu stated that UCWeb does not plan to IPO until the company’s annual revenue exceeds at least USD 163 million, at which point UCWeb will consider listing on a US exchange. According to Yu, the company currently generates about USD 32.7 million in annual revenue.

Alibaba and UCWeb also plan to release a new mobile e-commerce product in the near future, Yu noted.

Aug 22

Source: Tencent’s Mobile Gaming Annual Revenue Could Reach USD 245 Million Within the Next Year


An executive at a mobile gaming partner of Tencent said that the Tencent mobile gaming platform expects to have 500 million users by the end of this year. The platform includes games on both WeChat and QQ.

The WeChat platform currently has 15 developed games that are ready to be released. The plan is to release 2-3 new games per month. The annual revenue of the mobile gaming platform could reach as high as USD 163 million to USD 245 million within a year, according to the executive.

Tencent’s first mobile game, “Tian Tian Ai Xiao Chu,” has 1 million daily active users and generates USD 160,000 in daily revenue.

Baidu Integrating 91 Wireless’ App Store with Mobile Gaming Platform; Aims to Generate USD 16.34 Million in Monthly Revenue From Combined Offering


A Baidu executive in charge of Baidu’s native app store business told BrightWire today that Baidu is currently working with 91 Wireless to build an integrated platform that will function as an app store and mobile gaming platform.

 “The forecast of the platform is to serve 700,000 app developers and generate USD 16.34 million every month after the integration,” the executive said.


Aug 2

WeChat Executive: Apple App Store Has Approved WeChat 5.0; App Could Be Released In Early August


Responding to the rumor that the WeChat 5.0 release had been delayed, a senior WeChat executive said: “The rumor is false; WeChat 5.0 has been approved by the App Store and will be released in early August.” However, the source also said that Pony Ma has the final decision on the launch date.

According to the source, WeChat 5.0 will include a payment tool called WeChat Pay that will enable users to make in-app purchases. Tencent has already come to an agreement with Apple on the revenue sharing for the payment tool. The source expects the app to generate a lot of revenue. 

Aug 1

Taobao To Release New Advertising Features Built on Sina Weibo User Data


According to a source in Alibaba’s data mining group, Sina has given Alibaba full access to data on its Weibo users, including data from user profiles, microblogs, as well as user relationship data. The data sharing is part of the April deal in which Alibaba bought an 18% stake in Sina.

The source indicated that Alibaba has more sophisticated data mining algorithms than Sina, and said that the user data will provide Taobao store owners with more targeted advertising strategies. Taoabo will soon be releasing features built on this data to Taobao store owners.

Jul 31

Taobao Eliminates Data and Platform Access to WeChat


According to a source at Alibaba, Taobao has cut off its open platform service to WeChat. Prior to access being cut off, developers were able to develop WeChat pages that incorporated Taobao functionality and data.   This enabled WeChat users to access Taobao stores from within the WeChat application, bypassing Taoboa’s web platform.

Taobao told Tencent that the access was being shut off to prevent stores from using WeChat to harass users, and to prevent stores from using Taobao features without listing goods on Taobao.

The source said that Taobao’s goal in cutting off access is to prevent WeChat from building out its own e-commerce marketplace.


Jul 30

Source: Tim Cook To Meet With China Mobile During China Visit


Tim Cook will be meeting with a senior executive at China Mobile during his visit to China, according to a business development executive at China Mobile.
The source said that the goal of Cook’s visit is to revive iPhone negotiations between the two sides: “The negotiations have stalled for some time, because neither side has been willing to make concessions. This time, Tim Cook will meet with Xi Guohua, Chairman of China Mobile, and both sides are expected to have new [negotiating] positions.”

Jul 29

Tencent to Hold 6% Stake in Activision Blizzard Following Consortium’s Buyback of 172 Million Shares


An executive at Tencent told BrightWire today that the company will hold a 6% stake in Activision Blizzard if the consortium led by Activision CEO Bobby Kotick and Co-Chairman Brian Kelly is successful in buying back 172 million shares of the company from Vivendi. The consortium is buying back the shares for USD 2.34 billion and plans to buy back an additional 429 million shares, in a simultaneous transaction, for USD 5.83 billion. Activision Blizzard will become an independent entity following the deal.

The executive noted that Tencent also plans to strengthen its cooperation with Blizzard in China. “The stake in Activision Blizzard will benefit Tencent in many ways. Not only will it help the company secure the operating rights to the ‘Call of Duty’ game series in China, but will also give Tencent an advantage in competing for the operating rights of Activision Blizzard’s new games,” the executive said. He added that the deal will also make it easier for Activision Blizzard to develop a more specialized version of ‘Call of Duty’ for China’s online gaming community.

“Pony Ma, CEO of Tencent, has been in touch with Activision Blizzard for a few years,” the source noted. “Investing in the company is also an important strategy for Tencent in order to expand its overseas game business.”


Jul 25

Source: Large Corporate Clients Account for 40% of Baidu’s 2013 Projected Online Ad Sales


A source within the sales department at Baidu, Inc. told BrightWire today that the company is shifting its online advertisement sales focus from smaller businesses to large corporates with contracts valued at over USD 10 million. As a result, Baidu has also launched its Joint Business Plan (JBP) initiative to help meet larger clients’ needs, according to the source.

The source said that revenue from large clients will account for 40% of Baidu’s online ad revenues in 2013. Baidu has signed contracts valued at over CNY 100 million (USD 16.3 million) with more than five clients so far, the source added. These companies include Ping An Bank, Yihaodian and Jingdong. Baidu vice president Wang Zhan noted that large clients’ revenues grow at a much faster rate than those of Baidu’s overall online ads.

 “In Ping An Bank’s case, the contract with Baidu is worth over CNY 500 million (USD 81.4 million). Baidu not only sells ad words like ‘loans’ or ‘borrow money’ to Ping An, but also provides users’ behavioral data to the bank to allow it to understand customers’ habits,” said Ping An executive Xu Hanhua. “Over CNY 10 billion in loans have originated through Baidu,” Xu added

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