Piper Jaffray held an investment conference in Beijing last week. Here are some key points from this week's Piper report:
- Advertising, gaming, and travel showing solid growth.
- Online gaming companies continue to show greatest potential.
- Wireless - The industry is still unstable. The hope is that China Mobile's
(ticker: CHL) upcoming decisions on the format and overall framework of
relationships with service providers may bring some stability.
- Piper believes that expectations for advertising growth are modest.
- Industry likely to grow at a rate of 40%,
despite cautious guidance of 30% by the three portals.
some sectors like autos and real estate were slightly overheated last
year, new segments are starting to replenish growth in the
- Prices are expected to increase 10-20% a year, given the strong
- The front pages of most portals are usually sold out well in
advance. The smaller web sites are gaining market share
as advertisers start to use a wider range of online destinations.
- Dominated by Baidu.com and Google.com (ticker: GOOG).
- Other online destinations
have yet to establish a strong brand.
- No clear winner yet.
- Online transactions remain minimal.
- But listing services and auction sites (which do
the vast majority of their transactions offline) are growing.
eBay (ticker: EBAY) and Alibaba:
- Increasing competition between the two.
- eBay's strong global power cannot be
underestimated and the company's focus on China makes it even clearer
that they intend to win.
- Here too, a clear winner has yet to be determined.
- Sector remains unstable.
- China Mobile has yet to
finalize its framework for using service providers.
- China Unicom (ticker: CHU) had positive comments about its relationship with service providers. It does not
intend to increase its revenue shares.
- Growth in 2.5G and IVR looks promising.
Quick thought: If any readers attended the Piper conference, we would appreciate your thoughts.