Sina is leading the way in a portal transformation.
Yesterday morning, Sina reached a strategic cooperation with the NBA. The rights obtained by Sina include video live streaming of NBA internet games, co-operation and operation of the official online community of NBA China, casual gaming, e-commerce operations, as well as mobile live and on-demand streaming.
The framework for this cooperation will last from 2013 to 2014, covering two consecutive seasons. In fact, as early as 2010, Sina began cooperating with the NBA. The cooperation period was from 2010 to 2013, during which Sina paid $50 million. This cooperation is a continuation of the previous one, including exclusive live broadcasting of games, as well as authorization for mobile platforms. However, Sina has not disclosed the amount of this contract.
Breakthrough
Although Sina did not disclose the cost of this signing with the NBA, it revealed that the signing fee was much higher than Sohu's fee for "The Voice of China" Season 2. According to information from inside Sohu, the copyright cooperation fee for "The Voice of China" Season 2 exceeded RMB 1 billion.
Why sign with the NBA? IT commentator Chengdong Li believes that first, the NBA is the most beloved sports event among young consumers in China, even surpassing football in terms of attention. An editor from Tencent Sports once told this reporter that currently, NBA news generates the highest traffic on portal sports channels.
Secondly, NBA events have high density and strong user stickiness, lasting over 8 months per season. The NBA often aligns with fashion, pop music, and hip-hop culture, stimulating the development of products beyond videos, such as e-commerce and social networking.
Thirdly, Sina has acquired mostly exclusive live broadcasting rights. The main attraction for advertisers in sports events is live broadcasting, while the advertising value of re-broadcasts and edited highlights is greatly devalued. Meanwhile, Sina can also redistribute these copyrights.
Additionally, securing the exclusive rights for the NBA in China will not only further enhance Sina's brand effect but also bring in incremental users.
Composite Transformation Attempt
An insider at Sina revealed that Sina intends to break through the limitations of the old portal model through verticalized operations of some channels.
Since 2010, discussions about portal transformation have been taking place within Sina, but the conditions and timing back then were not yet ripe.
In April this year, Sina made a comprehensive adjustment to its homepage, which had remained unchanged for 15 years. From the adjustments, Sina has begun to focus on several aspects: user ID-ification, big data, mobility, socialization, and advertising efficiency.
In April this year, Sina's portal underwent a "facelift," and simultaneously, a series of mechanism reforms quietly began within the portal. According to insiders at Sina, after the "facelift," Co-President Hong Du divided Sina's portal channels into three categories. The first category is commercial channels, where sales tasks are the sole performance metric, such as automotive and travel. The second category is comprehensive channels, which must handle a portion of sales tasks while also being evaluated on content and traffic, like sports, finance, entertainment, and technology. The third category is media channels, such as the news center, which do not bear sales responsibilities.
IT commentator Chengdong Li believes that categorizing different channel types is essentially an incubation strategy, laying the groundwork for future verticalized operations. First, a mechanism is cultivated, along with appropriately relaxed soil under that mechanism, then observing which channels can develop rapidly under this setup and are suitable for independence.
The aforementioned Sina insider revealed that Sina is implementing new model explorations on its advantageous channels first, such as the sports channel. Sina's sports channel generates nearly RMB 300 million in annual advertising revenue and stands out in all portal sports channels in terms of traffic and resources. Introducing exclusive NBA video content will help promote other internet products and services of Sina.
This seems like a strategy of single-point entry and matrix-style penetration promotion. Under this strategy, Weibo, video, as well as game and e-commerce services, all benefit.
For example, Sina can provide value-added services such as social commerce and membership points. Purchasing officially authorized NBA merchandise via the NBA social e-commerce platform will earn corresponding experience points, which can be used to exchange for officially licensed NBA goods, including clothing, sneakers, peripheral products, and personalized accessories.
What connects all this, apart from the ID system, is also Weibo's membership system and service. Thus, a good developmental model of "media + social + e-commerce (products)" has been constructed.
This is also what Sina has been discussing since the advent of Weibo - the "big Sina" service of "media + Weibo community." After Alibaba's investment in Weibo, the integration of user data at the shopping end and the media end will provide data support for the "big Sina" ecological closed loop.