The chairman of one of China's leading Web portal companies said on Tuesday that the firm's thriving Twitter-like mini-blogging platform has the potential to be a huge revenue producer, according to the Wall Street Journal.
Sina Corp's chief executive officer Charles Chao told a group of third-party developers in Beijing that the company's Weibo micro-blogging service is in position to boost advertising sales to the point that it will become the most profitable aspect of the firm's business.
Weibo was launched in August in 2009, just around the time when Twitter was banned in China. In just over a year, the social networking site has attracted more than 50 million users. Chao expects that Weibo's user base will expand to more than 100 million early in 2011. At that point, Sina will roll out its initial advertising model.
“We will be able to make a lot of profit on it,” Chao noted. “It is just a matter of time.”
The projections for Weibo's future come just a few days after Sina posted a better-than-expected third quarter revenue of $108 million and profits of 50 cents a share, which easily surpassed the Wall Street estimates of $103 million and 44 cents per share.
CLSA Asia-Pacific Markets analyst James Lee told Barron's that Weibo's unprecedented growth and Sina's recent partnership with MSN should allow the company to succeed in the hyper-competitive social media space.
“With its recent partnership with MSN and its attractive IM user base, we believe Sina is on its way to becoming a social media powerhouse given its dominance in mini-blog and equity ownership in sister company Kaixin001.com," he said. “We expect this rare combination of IM, Facebook and Twitter will enable Sina to leverage its user-friendly applications with long-established client relationships."
Weibo is similar to Twitter in that it allows users to create 140-character posts as well as follow other subscribers. The site also enables users to embed photos and videos, something that Twitter does not allow, according to the Journal.
Beecher Tuttle is a TechZone360 contributor. He has extensive experience writing and editing for print publications and online news websites. He has specialized in a variety of industries, including health care technology, politics and education. To read more of his articles, please visit his columnist page.
Edited by Tammy Wolf
