YouWho? Chinese online video companies merge

Orlando, FL 3/12/12 (StreetBeat) -- Two Chinese online video companies agreed to merge Monday in an all-stock deal that will create a major new player in the rapidly growing market.

Under the terms of the deal, Tudou Holdings Ltd. (Nasdaq: TUDO) shareholders will receive 7.2 Class A shares for each Tudou share. Investors who own U.S.-listed shares of Tudou will be offered 1.6 shares of Youku Inc. (NYSE: YOKU), according to a joint statement.

The combined company will be called Youku Tudou Inc., which Youku CEO Victor Koo says will become "one of the largest Internet properties in China."

Tudou's American Depository Shares, which trade on the Nasdaq, surged 156% in early trading. Youku's U.S. shares jumped 24% on the New York Stock Exchange.

The YouTube of China is more than just cat videos

Often referred to as the YouTube of China, Youku is China's leading Internet television company. Tudou was founded in 2005 as the first user-generated content video sharing website in China.

The news also boosted shares of other Chinese Internet companies.

Shares of Renren (NYSE: RENN), a social networking site known as the Facebook of China, rose 8% in early trading.

SINA Corp., (Nasdaq: SINA) the parent company of Weibo -- China's version of Twitter -- also gained. Shares were up 4%.

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Ku6 Media (Nasdaq: KUTV) Announces Partnership with YouTube; Shares Jump 132%

Orlando, FL 1/17/12 (StreetBeat) -- Chinese online video portal Ku6 Media Co Ltd (Nasdaq: KUTV) said it tied up with Google Inc's (Nasdaq: GOOG) YouTube to showcase its videos on a new channel operated by the Internet giant, sending its U.S.-listed shares up 132 percent on Tuesday.

Ku6 shares rose $1.83 to $3.21 early on Tuesday on the Nasdaq in heavy trading.

The company expects the partnership to expand its content offering into the international market.

Ku6 also plans to recruit a team to operate this channel to help grow its user base and revenue in the international market.

The company competes with Tudou Holdings Inc (Nasdaq: TUDO), Youku.com Inc (NYSE: YOKU) and Qiyi.com, a firm partly owned by Baidu Inc (Nasdaq: BIDU).

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Youku Oh No!

Tallahassee, FL 11/17/11 (StreetBeat) --It isn't easy to turn a profit streaming video in China.

Niche leader Youku.com (NYSE: YOKU) posted mixed quarterly results last night. Net revenue soared 129% to $41.2 million. The site's net loss narrowed to $0.07 a share -- or $0.04 a share if you back out stock-based compensation. Either way, Youku missed Wall Street's bottom-line target calling for a deficit of $0.03 a share, though it did beat analysts' top-line forecast of $39.8 million.

Despite the rough sledding, Youku continues to trade above the $12.80 price it went public at nearly a year ago. However, the profitless speedster that peaked at nearly $70 back in April has now fallen all the way down to the teens. Rival Tudou (Nasdaq: TUDO) -- which went public this summer at $29 -- has shed more than half of its value.

Making money streaming video for free through an ad-supported model is hard. Just ask Google's (Nasdaq: GOOG) YouTube, which continues to make strides in monetizing its website but it will never be the high-margin business that Google's flagship search engine has become. Bandwidth isn't cheap, and there's a limited pool of display advertisers. Youku also pays for a lot of its professionally produced content.

Youku has turned to Tinseltown for a new revenue stream. DreamWorks Animation (Nasdaq: DWA) and Time Warner (NYSE: TWX) have gotten behind the Youku Premium pay-per-stream venture, though Youku will probably be as successful as YouTube has been to get folks to pay up for content. Youku's growth will continue to be tied to the willingness of advertisers to pay more to reach the Internet television website's growing audience.

Youku is targeting 90% to 100% in revenue growth for the current quarter, a slight deceleration from its triple-digit pace of the past. Clearly, this is still an impressive growth rate, though Youku's still lofty valuation begs for profitability to begin entering the picture around here.

Narrower deficits are moving Youku in the right direction, but now it needs to get to the finish line before it becomes the next of the many busted Chinese IPOs.

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