Sina Executive Confirms Wireless Business Restructuring
Tencent Tech, 12/14/12
On December 14, a senior executive at Chinese internet company Sina (Nasdaq: SINA) responded to reports of layoffs at Sina's wireless business. The executive confirmed that Sina was restructuring its wireless business division, but said that restructuring efforts affected the sales division and did not involve layoffs of more than half of Sina wireless employees as had been reported. Sina has not yet issued an official statement on the rumors.
The source said that as the value of wireless value-added service provider services (such as color ringback tones) declines, Sina Wireless will split off some of these services, and will transfer some employees to regional offices. Roughly 20 employees are leaving the company or opting not to be transferred, the source said. "There's a total of more than 30 people in the division being restructured," the source said, "so saying that more than half the employees are being laid off is an exaggeration - Sina Wireless employs more than 200 people in all." The restructuring was brought about mainly by changes in services, rather than any desire to scale back Sina wireless division costs and transfer the savings to the company's Weibo microblog platform, the source said; nor is it related to Sina wireless GM Wang Gaofei taking charge of some of Weibo's services.
"In the area of wireless value-added services," Sina CFO Herman Yu said in a previous investor teleconference, "operators have shut down some of our existing promotional channels in order to cut down on subscriber complaints. The industry is transitioning towards smartphones, and wireless value-added service provider services will not be an area of focus for us in the future, as they contribute relatively little in the way of profits."
Sina's wireless division reportedly is divided into two major services: operations and maintenance for Weibo and other mobile applications, and provision of wireless value-added services including color ringback tones, mobile themes, and mobile games through mobile operators and other channels. The latter is the area affected by the recent restructuring.
Editor's Note: For more background on this topic, please see "Rumor: Sina Microblog Appoints New GM" MD 11/19/12 issue.
Keywords: corporate restructuring Wang Gaofei wireless Sina Herman Yu SP WVAS HR
Sending
