Sohu's Zhang is stupid. Selling Sogou to 360, they will have 30% market share combined together. It will make a real threat to Bidu.
Selling to Tecent, Sogou will still be the 3rd market player, having 10% share. 360 will remain as the second with 18% market share. Do you think any big advertisers will put real money into either Sogou or 360? Stupid!!!
Sell Sohu, buy Bidu for long term investment.
Sell qihu in short teram, and buy them back when it bottom out.
I agree with Stephen, Qihu might have wanted to compete for this deal. I can understand however that the price would have gone way up if Qihu/Tencent got into a bidding war, and mergers tend to be messy.
Then the other side of the equation is, Qihu has alot of dough to proceed further in the direction that they're going, for instance, purchases directly from their integrated security product.
in the next 2 years, qihu's biggest hope is not search. It's mobile gaming and app distribution. this thing could be bigger than search in near future. that's why bidu rushed to buy 91 with 1.9 billion.
today is not the first time we know that qihu wouldn't be able to get sogou deal done. last time the news was broken out about a month ago qihu instantly fell to 62 from 70 and then rebounded back to 68 within a single day in huge volume.
i think "no 360&sogou deal" has already been priced in. However, 'sogou deal with tencent" might have not been fully priced in. this 3 dog race becomes tougher for qihu because sogou gets help from tencent.
You should blame QIHU's CEO for letting this deal slip through. Tencent's huge user base will bring more search traffic to sogou. Now BIDU can get a relieved breathe that QIHU didn't get SOGOU.
Tencent's soso doesn't do well although it gets aid from Tencent's QQ. Search quality is the eventual driver that shapes the search traffic share.
my personal experience regarding search quality: Bidu is no doubt the best. QIHU is the second being fairly close to BIDU. Sogou is the distant 3rd. Never used soso, so can't comment on it.
BIDU could care less about the measley 2% share that Tencent bought from SOGU. BIDU should worry about losing the rest of their 68%, down 17% from last year..QIHU was negociating with Tencent but didn't want to pay that absurd price!
Sentiment: Strong Buy
please read the pr's correctly. sohu sold 33-36% of sogou to tencent. another 4% might be sold if tencent so choose to buy it. the partnership will eventually be sohu 60 tencent 40. sogou market share is 9-13% depending on where the info is coming from. qihoo's market share is 13-18% of market share depending on where the info is coming from. tencent's own search "soso" has 2% market share. soso will be folded into sogou to be combined for 11-15%. the deal puts qihu in a bad position. if qihu have bought sogou, they would've instantly propelled themselves to 30% market share and be a very viable competitor to baidu. now it's back to a 3 ponies race with sogou and qihoo eventually fighting for 2nd place. the partnership between tencent and sohu is big. tencent has lots of eyeballs worldwide with their chat software...