Is Regulatory Risk For Sina Weibo Increasing?

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  • on August 11th, 2011

RedTech Advisors has just published a new report examining censorship on Sina Weibo ($SINA) in the aftermath of the 7.23 train crash. From the summary:

Digital Kow-tow: Censors are deleting fast and furiously at Sina’s microblogging platform Weibo in an effort to kow-tow to government sensitivities about the recent train crash in Wenzhou. During the past week, censors have intensified their efforts to wipe the platform clean of any “controversial” posts and done away with whole groups tracking the issue. After relatively robust coverage of the tragedy after it happened, this is a turn for the worse that risks backlash among users on a very public and sensitive event in China. Moreover, the ham-handed way in which Sina is executing the cleansing implies pressure from the government and once again resurrects the debate over regulatory risk for Sina’s most promising asset.

The full report:

RedTech Advisors On Sina Weibo Regulatory Risk And Censorship

The government is in the midst of an anti-rumor campaign (see  China tackles the messy world of microblogs – China Media Project , 微博时代我们怎样辟谣？人民时评, Hu Yong, Busting the bias of the Weibo rumor busters – China Media Project,  胡泳：“辟谣”并不天然具有正当性 – 观点 – 时代周报  and  止息微博时代谣言有待信息自由流通 [南都社论] ) to try to temper the flow of information (a fair amount of which is fabricated) on Weibo. If that campaign fails I would expect to see harsher measures to control Weibo, though I am skeptical that Weibo will be shut entirely.

The reasons laid out by Keso and discussed in this Digicha post from March–Three Reasons The Government Is Unlikely To Shutdown Sina Weibo–are still compelling:

1. People need an outlet for their views and emotions, and a visible one is safer than an invisible one;
2. Sina Weibo is controlled by people the government trusts, and the risks from shutting Weibo are greater than the risks from not shutting it;
3. The government can use Weibo to its advantage. (See China Media Project-China’s Leaders Embrace Social Media.)

You can follow me @Bill on Stocktwits, @Niubi on Twitter and @Billbishop on Sina Weibo.

Related posts:

  1. Tweeting Sina Q3 Earnings Call
  2. Sina, Tencent And Others Preparing For New Weibo Restrictions
  3. Happy Days Ahead For Sina And Tencent Weibos?
  4. 6th Plenum Report Suggests China Will Strengthen Internet Management
  5. Three Reasons The Government Is Unlikely To Shutdown Sina Weibo

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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