Tweets About Sina Weibo

• Posted by bbishop
• on December 17th, 2011

I write a lot more on Twitter than on this blog. As Twitter now makes it easy to embed tweets in WordPress I am going to start occasionally reposting Tweets here.

Congratulations to those who bought Sina ($SINA) near the lows Friday. I have not traded Sina in over a year and have no stake in the direction of the stock price. I just want to try to make a tiny contribution towards helping investors have as much information as possible, especially when so many professionals have been so off target and so many have investors underestimated the political risks to a product as disruptive as Weibo.

It appears that the government is just getting started in its reassertion of control over the Internet, and Weibo is target number one. I told Bloomberg Friday that:

“The focus right now is Weibo, because it is putting the most pressure on the government,” said Bill Bishop, a Beijing- based independent media consultant. “The ongoing campaign to rein in the Internet is closer to the beginning than the end…”

Given the growing intensity of the government’s Weibo regulation, some amount of tempering of discourse is likely. From the New York Times:

“It’s just a further sign of the way things are going,” said Bill Bishop, an analyst and businessman based in Beijing who writes about the Internet industry on a blog, Digicha. Some Internet users, he added, may now ask themselves, “ ‘Why bother to say something? You never know.’ ”

Sina Weibo is an amazing product that is worth a lot, but as I told the Wall Street Journal on Friday:

Though stricter regulation may reduce the vibrancy of Sina Weibo, Mr. Bishop said, microblogging will still be the best forum to exchange and transmit information in China and will remain “an interesting business.” Still, “you end up with a much less interesting long-term potential business than what people were saying six to eight months ago,” he added.

Depending on how real name registration is implemented, the costs could be significant for Sina. From the Financial Times:

…industry experts said the company will have to use a mechanism offered by the police for ad-hoc online identity checks.

Baidu, China’s largest online search engine, was using the system when it tried to build Shuoba, a real-name social media platform. The company abandoned the service earlier this year after it failed to gain traction with users and the checks, at Rmb4 (63 cents) per query, imposed an additional cost burden on Baidu.

“The question is whether Sina will have to shoulder that cost – that would be disastrous for them,” said Bill Bishop.

 Back to the tweets. Here are several from this morning:

amused by comments that real name registration will be good 4 sina weibo as a biz. they really think that is government’s intention? $sina

— Bill (@niubi) December 18, 2011

 

weibo, esp $sina ‘s, poses greatest threat to Party’s propaganda efforts in decades. The CCP plays to win, Weibo will be tamed, at any cost

— Bill (@niubi) December 18, 2011

 

a tamed weibo can still be a good business, just don’t think it can be a Twitter/Facebook-like one worth high 10 or 11 figures USD $sina

— Bill (@niubi) December 18, 2011

 

and the weibo cost structure will be quite high given all the verification and content management expenditures required by government $sina

— Bill (@niubi) December 18, 2011

Maxim Group reiterated its rating of Sell on $SINA and changed its price target from $75 to $42bit.ly/uWXamf ouch, outlier

— Bill (@niubi) December 18, 2011

 

overexposed. talk is cheap. doing something is hard. 2012 needs to be a year of doing of actually doing something

— Bill (@niubi) December 18, 2011

 

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