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51.com Ramps Up Gaming Business

China Computer World, 8/26/09

Long Zhenwei, spokesperson for 51.com, says the Chinese social-networking site (SNS) has established a gaming business division with the release of two games, 51 Xin Xuan Wu ("51 Flashy Dance") (http://x5.51.com/) and a casual puzzle game, similar to the kind found on Tencent's QQ Game platform.

On July 1, 2008, online game developer and operator Giant Interactive (NYSE: GA) invested USD 51 mln cash for a 25% stake in 51.com. On April 15, 2009, 51.com relaunched its 51 Game platform, reemphasizing its "community + gaming" strategy. Prior to Giant's investment in 51.com, the SNS derived over 50% of its revenues from advertising, with the rest coming from individual value-added services and casual games. After Giant's investment, however, 51.com's revenue model has undergone a major change, with gaming now expected to serve as its main source of income.

Currently SNS sites in the Chinese market depend mainly on advertising and value-added services for revenues, with Kaixin focused predominantly on advertising, and 51.com and Tencent's QQ Space relying more on value-added services. At present, 51.com's revenues from advertising and value-added services break down in a ratio of 1:2.

Keywords: online gaming Long Zhenwei online advertising casual game 51.com Internet SNS 51 Xin Xuan Wu VAS

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