By contributing author Tracey Xiang
The Weibo wars are over. The following make it clear:
1. Netease Weibo is asking users to move all their micro-posts to its blog site Lofter.
2. Tencent’s Weibo division was eliminated several months ago. Tencent hasn’t shut the site down but there’s no dedicated staff for it.
3. Charles Zhang, CEO of Sohu, acknowledged the failure of Sohu Weibo in mid-2012.
4. Baidu Shuoba, which differed from others in requiring identity verification (as with Facebook but Baidu wanted it to have Weibo functionality), didn’t get any traction and was closed in August 2011.
Besides those run by the big Chinese internet companies, a wave of Twitter clones have long since died. Weibo aggregation platforms and third-party application developers that emerged for the Weibo gold rush have become useless.
Sina wins the Weibo war. Now what?
It is often rumored that Sina Weibo has hundreds of employees in Tianjin, a city an hour from Beijing, monitoring posts on the platform. Employees at its Beijing headquarters receive requests for deletion from time to time and can make them disappear within minutes.
This is one of the reasons that the big Chinese internet companies have become major players in the Weibo market. They can afford the labor costs and have experience through operating online news sites, blogs, or other content businesses of handling commentary and deletions.
Almost all big Chinese internet companies joined in after Sina launched its Weibo in August 2009 and saw it quickly become popular. Netease’s was launched in January 2010, Tencent’s and Sohu’s in April the same year, and Baidu's in September.
Though most of them would claim hundreds of millions of registered users, Sina was swiftly ahead in active users and popularity. Most companies essentially channelled the users of their core products, such as Tencent’s QQ IM and Netease’s mail service. Sina, on the other hand, took advantage of its experience and resources as a news agency.
As well as creating eyeball-drawing posts, Sina staff did everything they could to get every possible category of content contributors on board, from news organizations to celebrities. For a long time, Sina evaluated employee performance through the number of celebrities or famous people in each industry an employee invited to sign up and how active they were. There were stories about Sina editors being fined for not having enough people on board.
But after Weibo was spun off from Sina and went public in the U.S. as Weibo Inc., people would find that the active user base of Weibo in China is actually limited and that expanding monetization approaches beyond advertising is difficult.
According to a report by CNNIC, as of June 2014, total users of all Weibos decreased 1.9% to 275 million compared to six months previously. After reaching a peak of 330 million, the number began to decline.
In the second quarter of 2014, Weibo Inc. made US$77.3 in total revenues, with 77% of that from advertising and rest from other paid offerings like gaming. The total would be substantially smaller if Alibaba hadn’t invested and pledged US$380 million in ad spending over the next three years. The majority of Weibo’s advertisers are believed to be those of Sina’s online news site.
From how it operates content to the business model, Weibo is essentially much like Sina’s online news business. Since online news sites in China are expecting declines and shifting to other formats, it’s very likely Weibo will be just the Sina news portal in the micro-blogging era.
Original post at TechNode.
About the Author
Tracey Xiang is Beijing, China-based tech writer. Reach her at tracey@technode.com