Bloomberg News

Sina, Tencent Microblog Users Resume Commenting After 3-Day Ban

April 03, 2012

Sina Corp. (SINA:US) and Tencent Holdings Ltd. (700) resumed the comment function for their microblog services after the Chinese Internet companies imposed a three-day stoppage amid a crackdown on online service providers.

Sina Chief Executive Officer Charles Chao made a post about the weather at 8:00 a.m. Shanghai time, when the facility was due to resume. That attracted more than 600 comments from users of the Shanghai-based company’s service, similar to that of Twitter Inc.’s. Kai-Fu Lee, former head of China at Google Inc., and the ninth-most-followed subscriber of Tencent’s microblog, attracted more than 400 comments for a post today.

Speculation on the Web on March 20 of a coup attempt prompted a nationwide crackdown on Internet-related crimes, leading to the arrest of 1,065 suspects and deletion of more than 208,000 “harmful” online messages, according to the official Xinhua news agency. Sina and Tencent, each with more than 300 million users for their microblogs, known as Weibo in Chinese, suspended users’ ability to comment March 31, citing the need to clear rumors and illegal information.

“The government certainly doesn’t want to shut Weibo, they don’t want to kill it - they want to control it,” said Bill Bishop, a Beijing-based independent media consultant. “If there is another burst of rumors in the next couple of weeks about particularly sensitive things, I don’t think the government will have any qualms about taking other steps to rein things in.”

Tencent, China’s biggest Internet company by revenue, rose 2.3 percent to HK$221.60 as of 10:07 a.m. in Hong Kong trading today, compared with a 0.6 percent gain in the city’s benchmark Hang Seng Index. Sina fell 2.1 percent in New York trading yesterday, the lowest closing price in more than a month.

The closing of Sina’s comment function is “negative, as we believe that comment functionality is key to Weibo user engagement,” Qi Guo, a San Francisco-based analyst at ThinkEquity Partners LLC, wrote in a research note yesterday.

Speculation on the Internet on March 20 of a coup attempt helped spark the biggest jump in four months in the cost of insuring against a default on Chinese government bonds. That was five days after Bo Xilai, earlier seen as a contender for promotion to China’s top decision-making body, was removed as party secretary of the municipality of Chongqing.

On March 30, Beijing Police announced the detention of six people for “fabricating and spreading rumors” on the Internet and forced 16 websites to close.

Sina and Tencent had been “criticized and punished accordingly” by authorities for a number of rumors, Xinhua said.

Government oversight of microblogging services has tightened as they’ve grown in popularity. In December, China began requiring users in cities including Beijing, Guangzhou and Shenzhen to register their real names. That rule will be expanded to other regions, Wang Chen, minister of the State Council Information Office, said in January.

Sina accounted for 65 percent of China’s microblog market by pageviews in December, compared with 27 percent for Tencent, according to a Jan. 12 report by BOCOM International.

To contact the reporter on this story: Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net


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