Bat merger boom is in full swing

With the pattern of bat oligopoly deepened, the domestic mergers and acquisitions war is also in full swing. From the beginning of the imitation, to today's investment in mergers and acquisitions, China's internet industry is breaking development and international standards.

Whether it's a wholly-owned or strategic investment, for mobile internet giants, it's all about resource consolidation and synergy. At present, Facebook, with 19 billion of dollars in cash and equities, has bought mobile applications WhatsApp, becoming the largest acquisition of the Internet industry since 2001, and Tencent has also invested 400 million of millions of dollars in public comments, accounting for 20%.

Over the past two years, with the rise of the mobile internet boom, internet companies began a large-scale alliances, trying to invest in mergers and acquisitions to occupy more, higher hills, perfect mobile internet layout. After several rounds of investment and mergers and acquisitions, we can see two very different ideas – "wholly-owned acquisitions" and "strategic investments".

Baidu left: wholly-owned acquisitions

Foreign companies like Facebook and Google tend to be big, wholly-owned acquisitions. Prior to the IPO, Facebook had bought a wholly-owned photo-sharing application developer, Instagram, with 1 billion of billions of dollars, and the acquisition of madman Google was dominated by wholly-owned acquisitions, with more than 50 wholly-owned mergers and acquisitions companies, including YouTube and Android operating systems. And the domestic giants, Baidu is also more inclined to a wholly-owned acquisition: Last year, Baidu has bought PPS and 91, the latter is at 1.9 billion U.S. dollars in the sky-high price has become the largest mergers and acquisitions case.

Not long ago, responsible for Baidu investment and mergers and acquisitions business of soup and pine is such a summary of the investment philosophy of Baidu: "Our style is not a simple pursuit of the concept, like a sprinkle of pepper to invest ... Only the concept of beauty is not enough, we have to pay attention to the actual value of the acquisition. ”

However, a wholly-owned acquisition also often implies a full receipt of potential risks, if successful, must be earned pot full, failure is trophies, so if not have a certain wealth to do the support of the Giants, the general enterprise is difficult to play, this is why sitting on a huge cash flow of Facebook, Baidu has become the protagonist of this series of acquisition games.

For Facebook, Google and Baidu, spending some "pennies" on strategic investment can only play a defensive role. Because the original company still retains control, even if the investment, integration is very difficult, want to form a deep synergy and do further expansion is not easy.

This time, many people questioned Facebook, that Zuckerberg bought expensive, and even joked that it is to take the initiative to die to death, but in fact, the controversy is more about the price. It is clear that a wholly-owned takeover should be done when the object of the acquisition emerges, rather than waiting for the passive situation to be expensive.

Google's acquisition of YouTube and Android operating systems did not cost as much as 19 billion, but the two have now propped up half of Google's empire. and domestic Baidu to buy where and the idea of PPS is basically so, wholly-owned acquisitions, and then full integration, the resources to these business tilt, thereby promoting its further independent listing; Baidu's total acquisition of 91 wireless, the first phase of integration effect significantly, as of the end of 2013, Baidu 91 application platform in mobile applications distribution market share of more than 40%, stable first, daily average distribution of up to 90 million, the convergence of high-quality developers over 700,000, the future of Baidu and 91 wireless will certainly further accelerate the integration, play a synergistic effect, and the most obvious embodiment is in Baidu's share price, Rose more than 50% in half a year. So from this point of view, if Facebook is well integrated, the deal may be expensive, but at least it can be harvested.

Tencent to the right: strategic investment

As a simple example, someone asked the public to comment on Zhang, Tencent investment, the future of the public will not give up with the map of the cooperation and the choice of Tencent map, Zhang's answer is: "We all from the user experience point of view, not for the sake of competition or other ideas and unilaterally for users to choose." "The implication is that Tencent map if not easy to use, will not make choices for users-adhere to the independent development of the public comments, and Tencent strategic synergy between how big, to play a big question mark." After all, the public comments to the micro-letter that a feng shui treasure, and Tencent is to be better stock prices and their good prospects to support, and this is the biggest advantage of strategic investment can bring-to small broad.

Strategic investment is the risk of split and equally, for investors, the success of the continued to overweight, according to the whole collection, such as Ali investment in gold. Failed, big can pat butt away, also hurt bones, such cases also since needless to say.

Tencent has a big enough platform to choose more strategic investments, whether the PC end, or mobile end, so the public comments and Sogou's investment case, Tencent has chosen to be 20%-30% of the shares, as a platform, Tencent can not be hands-on, as long as the micro-letter and QQ firmly in their hands, The seductive cakes of the hundreds of millions of user market will naturally tie these investors around. As soon as scroll analysis, the public comment is not Tencent's money, but the position on the micro-letter.

For Tencent, whether it is wholly-owned control, we are tied to the interests of the community, the final result is the whole platform of the ecology to do. Therefore, a wholly-owned acquisition of a single large, but not as strategic investment of each show its ability. Therefore, although Tencent does not have an absolute holding, it has mastered the absolute dominant power.

Ali's hesitation: first vote and then buy

When it comes to storytelling, Ali's acquisition is more so, good at the speech of Ma Yun is better at the investors and the market to tell stories, if Taobao, Alipay is the skeleton of the story, then the High German is to decide whether the story can plump flesh and blood.

Ali strategic investment and a lot of the objects are basically around its Taobao, Alipay, the two core business, including in the popular taxi application-quick taxi.

Although the story is easy to say, the commercial competition can not have a bit of virtual, strategic investment, although the smallest input to seek the greatest benefit, but difficult in the business integration. Ali built the O2O blueprint is very good, but it is not easy to combine the investment objects of the gold and American group with their own business, because the team of investors is obviously not so easy to be around. The lack of a founding team with absolute boldness and influence, such as Gould's, needs to be integrated in a wholly-owned merger, not to mention the Wang of the United States.

This integration of resistance also from Ali himself, Alipay and mobile Taobao platform properties are not strong, compared with the huge flow of Baidu and sitting hundreds of millions of users of Tencent, Ali want to put these investments in the business integration is not easy, even if it is burned heavily the quick taxi, In its and Alipay integration is also far inferior to micro-letter integration drop a taxi to do well. Most of the time, the story is still the story, so you can only constantly seek new stories to stimulate the market.

Maybe it's not hard to see for the Giants who are eager to layout mobile Internet, whether it is a wholly-owned or strategic investment, absolute control has a real integration and synergy, so that they can play both advantages and provide users with disruptive product experience in the mobile Internet era, and realize the company's overall strategic objectives. By contrast, in the absence of an absolute platform centripetal force, strategic investment is obviously slightly inferior, amateurs and test water meaning more.

Whether it's left radical or right conservative, or wandering and hesitating, from the original imitation of piracy, to today's investment mergers and acquisitions, the booming Chinese Internet industry is becoming increasingly international. 13 has Baidu acquisition 91 such a big deal, and with the Chinese Internet bat oligopoly pattern deepened, the future like Facebook to buy WhatsApp such a big drama, perhaps in 2014 also will be in the country again