Sohu Expects 2010 Video Advertising Revenue to Triple
Tencent Tech, 4/27/10
During the first quarter 2010 earnings call for Chinese online media, communication, search, online gaming and wireless value-added services provider Sohu (Nasdaq: SOHU), chairman and CEO Charles Zhang said Sohu's video strategy is to collect both exclusive and licensed content. Exclusive content will be resold to other websites in exchange for a share of revenues, while licensed content costs will be comparatively low. Sohu will purchase 3- to 5-year copyright licenses for suitable content. Co-president and chief marketing officer Belinda Wang estimated that Sohu's online video website advertising revenue in 2010 will triple revenues in 2009.
Zhang added that Sohu's Sogou pinyin IME has been relatively successful, capturing an 80% market share.
Wang said that in Q1 2010, Sohu had 608 advertising clients, and estimated that Sohu's automobile and IT-related channels, as well as online gaming, will be the primary drivers of brand advertising revenues in the following quarter.
On the online gaming front, Wang said Sohu gaming subsidiary Changyou's (Nasdaq: CYOU) licensed 3D martial arts-themed MMORPG Zhong Hua Ying Xiong will begin public beta testing at the end of May, and that Changyou's self-developed 2.5D MMORPG The Duke of Mount Deer will begin to generate revenues after a three month public beta testing period.
Editor's Note: In the earnings call, Belinda Wang said that brand advertising revenue was expected to grow 20% YoY in 2010.
Keywords: forecast online advertising Changyou Duke of Mount Deer online gaming Belinda Wang Charles Zhang content Internet revenue strategy wireless online video video advertising market share CYOU Sogou Pinyin Sohu Zhong Hua Ying Xiong
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