China's major online gaming firms reportedly plan caution in budgeting 2012 ad spend on gaming portal 17173, which has been acquired by online game developer and operator Changyou (Nasdaq: CYOU), a subsidiary of Internet portal Sohu (Nasdaq: SOHU).
According to one industry insider, the acquisition most likely will not affect smaller gaming companies, but could have a serious impact on large firms such as Shanda Interactive (Nasdaq: SNDA), Perfect World (Nasdaq: PWRD) and Tencent (0700.HK) that may reduce their 17173 marketing budgets because they don't want to divulge details on upcoming products or have a troubled history with Changyou.
Many industry sources believe that Tencent may relax restrictions on ads for competitors' games on its gaming portal, and that other gaming portals such as Duowan could also profit from the exodus of ad spend from 17173.
Changyou spokesperson Tang Liang said that 17173's ad rate card is unlikely to change significantly.
Editor's Note: For more information on this topic, please see "Changyou Acquires 17173 from Parent Sohu," MD 11/29/11 issue.