Sohu Weibo will promote the large-scale promotion of Charles Zhang from Sina to pull people

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Bianews October 26 (Wen/Tony) Sohu released its third-quarter financial results for fiscal year 2010 yesterday. Sohu Board Chairman and CEO Charles Zhang in the subsequent conference call talked about Sohu Weibo strategy.

Zhang admitted that Sohu is a bit behind in the field of Weibo, "because we started a year late, and encountered some setbacks." Zhang said Weibo and the media are very closely related to the media portal is very important.

For the microblogging promotion strategy, Zhang said Sohu Weibo will be in the next quarter and the first quarter of 2011 to carry out large-scale marketing and publicity, but also to take the celebrity route. "Because our portal traffic is huge, each channel also has its own opinion leaders, contributors and celebrity resources, we will strive to let these people contribute content for Sina at the same time for the content of Sohu." ”

Zhang has said in the previous period that he will personally grasp the microblog, and put the microblog in the highest strategic position, while the investment in micro-blogging will not be capped.

Related information: Zhang Chaoyang: Internet World War II Sohu Weibo declaration of war Sina

The following are the main elements of the analyst question and answer session:

Citigroup analyst Elisia Jappe (Alicia Yap): What is the main reason for the increase in gross profit margin of advertising brand advertising revenue in the three quarter? Was it due to a reduction in World Cup-related content spending this quarter or was it controlled by the purchase cost of video content?

Yuchuyan: This is mainly because our income continues to grow faster than spending increases. Gross margin will remain at that level in the next few quarters.

Elisia Jappe (Alicia Yap): In the three quarter, which area of advertising revenue growth fastest? What is the trend of online game advertising revenue?

Wang: Advertising revenue is growing faster in the automotive and FMCG sectors. Online game advertising revenue will continue to grow steadily in the fourth quarter.

Dick Wei, analyst at JPMorgan, Wei: What is the revenue from video advertising?

Yuchuyan: We don't publish this data, but the video advertising business is growing pretty fast.

Wang: The growth of video advertising revenue exceeds the average of revenue growth in advertising business.

Wei: What's the growth in the three-quarter search area?

Charles Zhang: Because Sogou Pinyin's dominant position and Sogou browser's unceasing promotion, the search request obtains up to 100% growth. We have also introduced better advertising-matching business technologies, which have further contributed to this growth. This is why we achieved such a big increase in the second quarter.

Wei: What is the number of customers in the search business?

Yuchuyan: The size of the search business is now small, but we are still achieving a 20% to 30% increase in the number of customers. But ARPU (per-user average income) grew faster to 70% to 80%, the main reason for this quarter's revenue growth.

Jenny Wu, analyst at Morgan Stanley: What's your strategy on Weibo, Gianni Wu? How does Sohu become the second leader in the microblogging field?

Zhang Chaoyang: Sohu in the field of Weibo some lag behind, because we started a year late, and encountered some setbacks. Weibo has a very close relationship with the media and is important to our media portals, so we will work hard to win back market share. Because of our portal traffic is huge, each channel also has its own opinion leaders, contributors and celebrity resources, we will strive to let these people contribute to SINA content at the same time for Sohu contribution content. We will also be in the next quarter and the first quarter of 2011 to carry out large-scale marketing and promotion. Weibo is of strategic importance to our portal.

Gianni Wu: You talked about the marketing and marketing of Weibo, what is the trend of future marketing expenditure?

Yuchuyan: Weibo's marketing spending will be long-lasting and long-term, so there will be no pressure on future gross margins.

Overall, sales growth in the next quarter is about the same as the two quarter and the three quarter.

Gianni Wu: How many advertisers have you had this quarter?

Wang: We have 975 advertisers this quarter, compared to 870 customers in the last quarter.

Gianni Wu: In the last conference call, you mentioned that real estate advertising revenue has not been affected by the adjustment of government real estate policy, please introduce the latest situation. May I ask Sohu next quarter and next year in the real estate sector income forecast how?

Wang: The government's new real estate policies, such as property taxes and restrictions on first-tier city mortgages, do have an impact on advertising in the real estate sector. We are trying to provide more online marketing solutions for real estate advertisers. Real estate advertising revenue in the first tier of cities has not declined, and we plan to increase investment in second-tier urban real estate advertising, so we expect ad revenue to increase in the four quarter.

Windy Huang, RBS analyst, Wendy Huang: The search business in the last quarter to achieve a good rebound, ask in Sohu's plan, Sogou in the Chinese search market in the three years to achieve how much market share?

Wang Xiaoquan: In three years, we want to get 10% to 20% of the search market.

Windy Huang: Does this mean that Sogou plans to achieve income growth of 10 times to 20 times times within three years?

Yuchuyan: I think revenue growth is slower than market share growth.

Gary Ngan, analyst at UBS, Gari Legan: What about Sohu's spending in the search area? Sogou and Alibaba reached a search strategy, but Alibaba is also developing its own search, what is the significance of this strategic cooperation?

Zhang Chaoyang: Alibaba is an important force in China's internet industry, especially in the field of electronic commerce. Taobao has millions of users in E-commerce transactions. Alibaba's investment and cooperation will enable Sogou to have more e-commerce data, so as to provide better general search. Taobao search is more like the vertical search of E-commerce, and Sogou is a universal search. Alibaba's E-commerce data will enhance the quality of Sogou search results. Sogou Browser will also provide Alibaba and Taobao users with a safe browsing experience. Therefore, Sogou and Alibaba and Taobao have two intersection, which is also our investment and cooperation with the reasons.

Gari Legan: So when can we see users start using Sogou browsers to trade on Alibaba and Taobao?

Charles Zhang: Our two companies are already in the first round of negotiations on E-commerce data, about Sogou browser and Alibaba cooperation, we are still in discussion.

Goldman Sachs analyst Lisa 袁 Lisa Yuan: I would like to ask Mr. Wang Xiaoquan, whether the dog will speed up the pace of investment, set up their own sales channel team? The second question is, what is Sohu's expectation of 2011 brand marketing?

Charles Zhang: Sogou is currently working with agencies, rather than Baidu as the establishment of their own marketing team. As for Sohu's Sogou, SNS and Weibo strategy, is not yet determined.

Paul Wu, a Samsung Securities analyst Paul Wu, said that revenue growth in the four quarter was slower than in the previous quarter, is this due to seasonal reasons or slowing market growth? What is the proportion of real estate advertising revenue to total income?

Wang: There will indeed be a slowdown in the three quarter and the four quarter, as revenue growth in some sectors of advertising has slowed. However, such areas as automobiles and FMCG will remain relatively high. So overall, advertising revenue growth will remain stable. Three quarters of the real estate sector advertising business compared to last quarter to maintain a stable.

Wendy Huang, RBS analyst Windy Huang: Mr. Zhang, you said in some media interviews that you want to rebuild the entire Sohu, including search, online games and Web 2.0, can you talk about Sohu's video and Web 2.0 strategy?

Zhang Chaoyang: China's younger generation, such as the Chinese and the young people think TV programs are boring, so they turn to the internet to watch videos, movies. We have seen this trend many years ago, so we have launched a crackdown on piracy, and now the video industry has a good situation. People are aware of the problem of piracy, began to spend money to buy content, the entire video industry has also been a new injection. We will continue to purchase more content and optimize technology to provide higher quality video to more low bandwidth users. We will not only increase our investment in TV dramas, but also add more variety shows and reality shows. As our traffic increases, we may be able to create some video content on our own. Advertisers have become accustomed to advertising on television, so it is natural to put ads into the field of video, and our video advertising revenue has also grown rapidly.

On the Web 2.0, our microblog is a bit behind, but we'll catch up. Weibo is closely related to the media and portals, and we are also planning our SNS strategy. These strategies will be clearer in 2011.

Eddy Liang, an analyst at Bank of America Merrill Lynch, Leung: How will the government's Internet TV (triple-net) policy affect Sohu?

Charles Zhang: The topic of triple net fusion has been discussed for a long time, but no real action has been seen yet. Therefore, Internet TV policy on the impact of online video is very small, online video site is still the best video platform, this is because the number of video sites, online video field of competition is very fierce. I believe the future belongs to the online video site.