Netease Tech, 1/11/10
Joe Chen, CEO of Beijing-based internet holding company Oak Pacific Interactive, has revealed that the company has begun preparations to IPO in 2011. Chen said that the group achieved overall profitability in the second quarter of 2009, with income primarily coming from browser games and from branded advertising on the social networking site Renren. In 2009, the user base and revenue for both the company's browser games and Renren experienced rapid growth, both tripling over the year, said Chen.
Chen said that for 2010 the company established a development goal of 70-80% growth in its user base and income. Renren has 120 mln registered users and 30 mln active daily users, and gains an additional 200,000 users daily. Chen estimates that in 2 years, Renren's registered users will exceed 300 mln and its daily active users will reach 70-80 mln.
Chen added that advertising accounted for a slight majority of revenue for Renren, with ads mainly from branded advertisers, of which ads for fast-moving consumer goods accounted for half. Chen said he expected paid services to grow to become the majority of the company's revenue in the future, with value-added services on Renren and other online gaming services nearing half of the company's total income in 2010. Chen also noted that sister SNS Kaixin would merge into Renren to form a single site in the future.
Chen also revealed that Oak Pacific intends to spin-off its Mop entertainment portal into a separate entity to list on a growth enterprise board either in Mainland China or in Hong Kong in the next two to three years, and that the separate listing would occur at a later date than the parent company's IPO. Chen said that Mop's annual advertising income is nearly RMB 100 mln, and that income from games is even larger. Jiang Zhiqiang, Oak Pacific's sales director, said that Mop's daily visitors grew 300% in 2009.