An industry source close to Chinese Internet firm Sohu's (Nasdaq: SOHU) group buy channel, Ai Jia Tuan, said today that a final verdict had been reached for the channel, which will reportedly be folded into Sohu's Focus online real estate service and will focus on offering group buy deals on home furnishings. Once the move is made, the source said, Sohu will abandon its previous attempts at group buy services for food, beverage, and other offerings.
Sohu's plan for current Ai Jia Tuan employees calls for "appropriate" employees to be transferred to Focus, where they will continue work on group buy services; "inappropriate" employees will be interviewed for new positions or "dismissed on the spot."
The source said, regarding the abandonment of "general service" group buy efforts, that Sohu CEO Charles Zhang was not confident in the project. Sohu has never shown intense interest in e-commerce, the source said, and Zhang had stated multiple times that the company would not go into e-commerce.
Wang Xiaochuan, CEO of Sohu search subsidiary Sogou, revealed in an online Q&A yesterday that Sohu's focus in H2 2011 would be on search, video, and microblogging.
Editor's Note: For more background on this topic, please see "Rumor: Sohu to Dissolve Group Buy Channel" MD 5/09/11 issue.