Posted by: Bruce Einhorn on April 18, 2006
AOL and the Shanghai Media Group have announced plans for AOL to carry SMG programming on the U.S. company’s Chinese-language site. Government-owned SMG is the biggest fish in China’s media pond. For instance, it’s the only company to have a license from the government to operate IPTV services in China. So AOL seems to have chosen well.
But the bigger news here is this: AOL actually has a Chinese language web site. Who knew? As other American companies have been trying to establish themselves in China’s Internet market, AOL is the one company that has seemed to be on the sidelines. Google, MSN, Yahoo have all been aggressively expanding in China – and in the process generating a lot of controversy because of their willingness to go along with China’s censorship policies. Other U.S. e-commerce giants, like Amazon and eBay, have been busy too. But we haven’t heard much from AOL, not since it was very publicly burned back in 2001 when it first tried to break into China. Back then, AOL tried to team up with China’s biggest PC maker (then known as Legend, now called Lenovo) to launch a Chinese-language portal. (Here’s a link to the People’s Daily report on the JV’s launch.) The deal got a lot of headlines but the partnership was a disaster and the joint venture flopped. Now AOL is making another try, but has been taking things very slowly – go to the home page now and you see that it’s just a beta version. But the deal with SMG shows that AOL might finally be over the trauma of its Legend flop.