MyRice is Nice, but Top Portal Prizes Remain
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Lycos Asia's reported acquisition of MyRice.com will increase the portal's reach in China, but Yahoo! could take a commanding lead in China's Internet market by buying Sohu.com, statistics obtained exclusively by asia.internet.com show.
At a cost of approximately $8.40 per customer, Lycos Asia's purchase of MyRice (assuming a final price of $10 million) will give the Terra Lycos-Singapore Telecommunications (Singtel) joint venture 1,190,000 million new home users, and a total reach of 22.5 percent of China's home Internet user audience, according to figures released by Interactive Audience Measurement Asia (iamasia) Friday. Reach, expressed as a percentage, represents the number of unique home users divided by the total number of home Internet users during the reported time period, iamasia said.
A unique user is defined by iamasia as "the number of individuals who visited a particular Web site during the reported period."
Lycos Asia has also been named as a prospective buyer of top portal Netease.com, which is seeking a buyer, reports last week indicated. By acquiring Netease, Lycos would buy 4,929,000 new home visitors in China and 40,000 new home visitors in Hong Kong. Such an arrangement would also give Lycos an overall increase in reach of 53.5 percent (65.7 percent in China, 2.2 percent in Hong Kong), iamasia said.
However, Yahoo! or chinadotcom corporation could surpass Lycos in the China market by buying any one of China's top three portals: Netease, Sina.com, or Sohu.com. Yahoo! stands to make the greatest gain by purchasing Sohu.com's Web properties. iamasia defines "properties" as "all of the related Web sites and pages owned by the same company." A combined Yahoo!/Sohu entity, which would include ChinaRen.com, acquired by Sohu in September, 2000, would have 5,720,000 unique home users and a reach of 76 percent in China, according to November, 2000, iamasia research data, released publicly on January 5.
chinadotcom could make similarly significant gains by merging its china.com portal with Sohu's Web properties. Together, the two would have 5,417,000 unique users and a 72 percent reach among China home Internet users.
Should Yahoo! emerge as the new owner of Netease, the pair would have 5,518,000 and a 74 percent reach in China, iamasia said.
Unique usership is not the only measure of audience or value of a Web site or Web property. For example, in November, 2000, Sina.com generated approximately 738 million pageviews, despite Netease.com garnering the most unique users. Some advertising and Internet industry analysts prefer pageviews as a yardstick of the quality of users and the "stickiness"--or amount of time an user spends on a particular Web page or Web site. Therefore, while Netease.com may have more individual visitors who looked at one Netease page during a given month, Sina.com users may spend more time there, consume more content, and perhaps most importantly--be exposed to more advertising.
Netease has neither denied nor confirmed its intent to sell, although Chief Technology Officer and Founder William Ding indicated the company would accept a fair offer from a qualified partner.
chinadotcom, Lycos Asia, and Yahoo! have not publicly indicated interest in buying Netease. However, Lycos Asia is known to be seeking at least one acquisition in the China market, and Yahoo's buy of Kimo.com, Taiwan's top portal for $146 million in November may indicate the Internet giant's willingness to purchase its way into the China market. Yahoo's overall ranking of sixth among China home users is its worst ranking in any international market in which it operates a local Web site.
Steven Schwankert is Managing Editor of asia.internet.com