Chapter 48 Ma Huateng's "Swordsman"

Before the three major portals ushered in the spring, their entrepreneurial journey was the same as that of Ma Huateng, benefiting from overseas venture funds. When the Internet bubble came, life was extremely embarrassing. In November 1996, well-known futurists and MIT professors Negroponte and Edward Roberts invested 225,000 US dollars in Zhang Chaoyang. In February 1998, Sohu was officially born, and the concept of portals in Chinese Internet history was opened.In October of that year, the US "Time" magazine named him one of the "50 Global Digital Heroes". On October 27, 1998, Sina.com began to enter the world's field of vision; and in Guangzhou, thousands of miles away, Ding Lei was also considering the transition from e-mail to portal websites.

While Sina.com exuded star power, Alibaba, which Jack Ma was building in Hong Kong, did not attract much attention.A year later, Robin Li, who planned to return to China, began to consider naming Baidu. At that time, OICQ, which Ma Huateng started, was not favored by people.At that time, the focus of the Internet was in Beijing, and the core of the focus was the portal.At that time, apart from portal websites, other business models were not clear.But Zhang Chaoyang, Wang Zhidong, and Ding Lei all believe that the Internet will definitely change the world in the future.Based on this ideal, China's Internet portals began to falter.

Sina, Sohu, and NetEase, the three major portal sites, are simultaneously making efforts in content, competing to provide basic services such as news, BBS, e-mail, and search.This is seen as the initial stage of portal development, and people call these companies ICPs.At that time, the Internet had just started in China. According to the statistical report released by China Internet Network Information Center (CNNIC) that year, as of December 31, 1998, the number of Internet users in China was only 2.1 million.Internet companies are almost all characterized by overseas VC investment and entrepreneurs trying to burn money to earn attention, so that traditional economists are a little confused. On July 12, 1999, CDC was listed on NASDAQ, which was the first stock of a Chinese concept Internet company listed on NASDAQ in the United States.Subsequently, from April to July 2000, Sina, Sohu and Netease were listed on NASDAQ one after another, setting off a climax of Internet companies listing in the United States and bringing China's Internet industry into a new stage.

With the sensation caused by Yahoo Myth in NASDAQ and the influx of a large amount of venture capital, the Chinese Internet led by the three major portals has gradually become an important link in the global capital chain. The VC system, options, rapid growth, overseas listing, company transparent management, announcement system, including CEO and other new terms have brought a new look to China's Internet industry.Compared with the "grand event" of CDC a year ago, when the listing amount was more than ten times subscribed and the opening price rose by more than 200%, the listings of Sina, Sohu, and Netease were somewhat bleak.The entry of China's portal websites into the capital market has become a symbolic event of China's Internet.

Around 2000, many websites claimed to be portals, but the first cold winter of the global Internet made life extremely difficult for portals.For example, when Lenovo and AOL jointly invested in FM365, they used the gimmick of the marriage of two IT giants at home and abroad to publicize it in the media, which attracted great attention from the market.But soon died due to encountering winter. 263 once claimed to be the "fourth portal", but after being frustrated, it turned to a professional email service. In 2000, when the three major portals were just trying to lead China's Internet industry to a boom, the news from across the ocean forced all practitioners to shrink their battle lines. On March 10, the Nasdaq Composite Index touched a historical high After 5132 points, it took a sharp turn for the worse. By April 4, 2001, it had fallen to 1619 points, and the global Internet market immediately fell into a low ebb.At this time, the concept of China in Nasdaq was like a roller coaster, and it plummeted. In the next three years, the three major portals were all suffering.In addition to changing the portal model originated from Yahoo in the United States to a Chinese portal featuring human sea tactics, they are also looking for good opportunities in various Internet applications.

This low tide is long and cold.No one has specifically counted how many Internet companies went bankrupt at that time.However, subsequent global survey data showed that by the third quarter of 2002, the number of Internet companies filing for bankruptcy protection or closing down was significantly lower than that of the same period of the previous year and the previous quarter, and the bursting of the Internet bubble was finally coming to an end.In this cold winter, China was not spared either. Overseas investors withdrew their capital one after another. A large number of Internet companies fell into a wave of layoffs, mergers, acquisitions and bankruptcy. Many websites either disappeared or were forced to transform.Portal websites are also facing tremendous pressure and have to find new sources of profit.

In March 2001, Sina began to try a new form of online advertising. In 2000, Sina ranked first among the top ten online advertising media.In April of the same year, Netease acquired Tianxia's R&D team, laying the foundation for its future entry into the online game industry.However, in this year, the mainstream voice of several major portals is still "reducing expenses and overcoming difficulties".Portals have either compressed or converted free services such as e-mail, alumni records, and personal homepages to fees.Whether it is free or charged, it also aroused heated discussions among netizens and the media.

Also in this year, the website began to try and launch a new service: SMS.What surprised many people at first was that compared with other businesses, the SMS service bundled with the operator gave the website a new source of income, which soon turned into actual profit-the SMS service saved a large number of Internet sites at that time. In July 2002, in the second quarter financial report released by Sohu, it realized profit two quarters ahead of schedule. At the beginning of January 2003, Sina acquired the mobile value-added service provider Guangzhou Xunlong. At the end of the month, Sina released its financial report, achieving full profit for the first time with a net revenue of 12.9 million US dollars.

In 2003, the three major portal websites relied on the life-saving straw of SP business to turn around, while Ma Huateng’s Tencent not only relied on SP value-added business, but also made a lot of money in the value-added business of instant messaging. , It wasn't until Tencent went public in 2004 that everyone seemed to start to favor Tencent. SP business refers to the direct provider of mobile Internet content application services, responsible for developing and providing services suitable for mobile phone users according to user requirements.Sohu, Sina, NetEase, CDC, Tom and other companies mainly provide short message service.The content of its short message service mainly includes ringtones, pictures, text teasers, news, games and so on.And Tencent focuses on QQ-derived SMS services.With the contribution of the SP business, the performance of the three major portals has changed from the bleakness of the past and has risen sharply.

Sohu's 2003 financial report shows that its advertising revenue has climbed from US$13.9 million in the previous year to US$29.5 million, an increase of 113%, while the growth rate in the same period in 2002 was only 50%, which is an astonishing growth rate.Among them, in the fourth quarter of 2003, the gross profit margin of advertising revenue increased from 65% in the same period of 2002 to 77%. Advertising revenue has become the mainstream of Sohu's highly rising revenue in the fourth quarter. Sina's 2003 financial report also showed that its advertising revenue reached US$41.2 million, an increase of 67% compared to 2002, accounting for 36% of total operating revenue.NetEase's financial report for the fourth quarter of 2003 shows that the net profit in the fourth quarter was 94.1 million yuan (US$11.4 million), an increase of 11.9% over the previous quarter's 84.1 million yuan, and the advertising revenue was only 26.5 million yuan. , an increase of only 3% over the previous quarter.Among China's top 100 electronic information companies, Sina can only rank 92nd based on operating income; however, NetEase, Sina, and Sohu can all rank among the top 20 if they are ranked based on profit.When the value of one Sina is equivalent to 1 Sichuan Changhong, 2 Bright Dairy, 3 Shanghai No. 1 Department Store, 4 Hainan Airlines, and 8 China Resources Land, the weight of Internet companies is fully displayed. "Southern Weekend" made such a comparative analysis.

According to IRESEARCH statistics, in 2003 China's online advertising turnover reached 1.08 billion yuan, more than doubled from 490 million yuan in 2002, and will continue to grow at an average annual growth rate of 55% in the next three years. For the heads of the three major sects, the cold winter has passed.Although the degree varies, the trend of portals getting out of the painful period of burning money and rushing towards profitability is obvious. Fang Xingdong, chairman of the Internet Lab, said: "The outstanding performance of portals such as Sina proves that this is a mature commercialization model." As the king of instant messaging services, why does Tencent want to be a portal? This is a question. For many years, Tencent has followed the path of linear development of a single product. In the early stage of entrepreneurship, focusing on one point can concentrate all resources and achieve faster development speed.But as it grows up, it inevitably begins to seek more room for development and more support.At this time, the Internet's only market with a low threshold, large space, and mature profit model-portal became Tencent's best choice. Ma Huateng described QQ and .com as the horizontal and vertical axes that support the future development of Tencent. The vertical axis is the platform of instant messaging systems such as QQ, and the horizontal axis is the platform of the comprehensive portal. This portal will include all the applications of future online life. go in. QQ is an entry point, a contact point, and can complete some functions around the theme of interactive communication, but the deeper application must be on the portal platform. Xu Chenye pointed out to the "Peking University Business Review": Tencent's transformation from a domestic instant messaging leader to a portal latecomer is the only way for development.Every Internet company hopes to become a comprehensive platform, just like a supermarket, where you can buy everything you want today.Those who are professional often end up with the same goal by different routes. Google started with search, and finally developed into content and email.There is Shundian in the traditional home appliance industry. Wal-Mart does not stop selling air conditioners because of this. It provides comprehensive products and convenience, which is the value of supermarkets.The seemingly large and comprehensive development route aims to provide integrated value for the future. For Tencent, another important reason for entering the portal is that Tencent has locked in a large number of loyal users through QQ, but it is far from enough to rely solely on mobile QQ to collect some mobile and communication value-added service fees, and send some advertisements through the QQ client. Digesting QQ's huge influence on users will make it even more difficult to support Tencent's ambition to become bigger and stronger. QQ is like a highway, and a portal is like a store built on the side of the road. Opening a 7-Eleven is not as good as opening a Wal-Mart, so that passers-by can easily buy all the things they need at once.