Wang Xin, CEO of Kingsoft Security: Vendors cannot be both the referee and the athlete.

CEO of Kingsoft Security, Wang Xin On the afternoon of March 29th, news came out that Wang Xin, CEO of Kingsoft Security which had just split from Kingsoft Corporation, was a guest in Sina's interview room. He exchanged online with netizens regarding Kingsoft Security’s future development strategy, the current state of the security industry, and user privacy. CEO of Kingsoft Security Wang Xin was a guest on Sina. Media source: Sina Technology.

Wang Xin stated that Kingsoft Security does not rule out the idea of capital operations or going public in the future. Because security is an especially large market, and domestically there is a lack of independent, self-innovating companies in this field, we particularly hope that this business can be packaged for domestic listing.

Regarding how to view competition among security companies, Wang Xin believes that within the industry, first there should be fewer verbal disputes, secondly there should be no unfair competition under the guise of users. For example, telling users that another company's tool is unsafe; because as security companies, we are somewhat like police and referees, but ultimately the decision-making power should still be returned to the users, allowing them to choose whether a product is usable or not. Being both a referee and an athlete might violate unfair competition regulations.

This morning, Qihoo 360 publicly announced its "User Privacy Protection Commitment" and also announced that it would hand over its source code to China Information Security Evaluation Center for custody and inspection so that users could supervise at any time. Regarding this, Wang Xin believed that in the Internet era, source code basically updates automatically every day, much like daily update versions, so custodial source code is not the key to solving privacy issues. Personally, I think that industry supervision is particularly important. Our previous supervisory units were the Ministry of Public Security and the MIIT, and their annual reviews for green standard certification are very important.

Key Insights:

Within two years, our focus will still be on providing better services to users, especially internet users regarding security services. Of course, we do not rule out the possibility of capital operations or going public. Because security itself is a particularly large market, and domestically there is a lack of independent, self-innovating companies, we particularly hope that this business can be packaged for domestic listing.

Everyone knows that early antivirus vendors mainly handled operating system viruses, such as when virus authors were primarily focused on technical boasting. With the vigorous development of the Internet, more and more hackers have shifted their technical focus to profit, because more and more of our virtual assets and actual assets are placed on the Internet, such as online banking, shopping on Taobao, playing games online, and having many personal accounts online. So hackers have shifted their focus to online virtual assets.

We often discuss this topic internally with our employees. In the same细分market, giving users more choices benefits the development of the industry. For example, in the security guard industry, there is Qihoo 360 Security Guard and Kingsoft Security Guard. Having one more option for users is better than having one dominant player in the long term. We encourage fair and direct competition, which is beneficial to users.

Kingsoft still faces cultural and value transformations. People who understand Kingsoft know that Kingsoft has been engaged in the development of self-innovating software since early days. However, the purely technology-oriented development model and values may pose obstacles to the long-term development of the company. I believe that the CEO must accomplish cultural or value self-transformation to lead the company to better steps. I firmly believe that the greater your ability to negate yourself, the more opportunities and innovations will come.

Below is the full dialogue transcript:

Future Domestic Listing

Sina Technology: Hello everyone, welcome to Sina Technology's video live broadcast room. I am the host Jing Quan. Today, we have Mr. Wang Xin, CEO of Kingsoft Security Software, joining us in the live broadcast room. Welcome Mr. Wang.

Wang Xin: Hello, Sina netizens and host.

Sina Technology: Recently, friends who follow the industry know that we have heard rumors that Kingsoft Security has established its own entity company, and the security product strategy has also started to be re-deployed. Today, it can be said that it is the first formal media statement by Kingsoft on this matter.

Wang Xin: Yes.

Sina Technology: Mr. Wang, please tell us what exactly happened?

Wang Xin: This is the first time I am exchanging with the audience friends. Our Kingsoft security software has officially separated from Kingsoft Corporation, establishing a separate company named Kingsoft Security Software Co., Ltd. Kingsoft's business is officially divided into office software, security software, and gaming. The security company operates as an independent subsidiary, with all financial, human resources, and administrative rights completed independently by the subsidiary. On one hand, this is the result of the growth of security software, which accounts for about one-third of the entire group's profits and sales. On the other hand, it is also to be more focused, making this business more independent and better developed.

Sina Technology: Mr. Wang Xin is currently the helmsman of Kingsoft Security Software and will specifically be responsible for this business. Now that it is independent and formally established as a security subsidiary, what are the plans? For example, is there a plan to go public in the next one or two years?

Wang Xin: Separating this business is not solely for the purpose of going public. On one hand, it is for more focused business and better service to users. In the next two to three years, we will focus on the internet transformation of the business. Within two years, our main goal is to provide better services to users, especially internet users in terms of security. Of course, we do not exclude the possibility of capital operations or going public. Because security itself is a particularly large market, and domestically there is a lack of independent, self-innovating companies, we particularly hope that this business can be packaged for domestic listing.

Sina Technology: I noticed you mentioned domestic packaging for listing. If you have to choose, which part of the capital market might you select, such as the Growth Enterprise Market (GEM)?

Wang Xin: Kingsoft is a very local brand with significant influence domestically. The last time it went public was in Hong Kong. Considering the intellectual property rights and domestic recognition of the security business, this time we aim for the domestic market. As for which specific sector to list in, we will decide based on the business development situation.

Internet, Mobile Phones, and Cloud Security

Sina Technology: We will continue to follow this closely. Next, let's talk about products. Earlier, Mr. Wang Xin mentioned that the reason for separating the product line is to make it more focused and professional. We noticed that recently Kingsoft has successively released a series of new products including Kingsoft Guard, the Professional Edition of Kingsoft Antivirus, the new version of Kingsoft Web Shield, and Kingsoft Mobile Guard. Regarding these new products, Mr. Wang, could you share what new dynamics Kingsoft will have in security technology and products in 2010 after the establishment of the new subsidiary?

Wang Xin: Talking about new dynamics in security, let me mention three keywords. One is the Internet. Everyone knows that early antivirus vendors mainly handled operating system viruses, such as when virus authors were primarily focused on technical boasting. With the vigorous development of the Internet, more and more hackers have shifted their technical focus to profit because more and more of our virtual and actual assets are placed on the Internet, such as online banking, shopping on Taobao, playing games online, and having many personal accounts online. So hackers have shifted their focus to online virtual assets. How to better ensure the safety of Internet users is the first point of attention after our business transformation. We should pay more attention to the security needs of Internet users. Everyone knows that Kingsoft Antivirus has mainly completed the transition of sales channels and payment channels to the Internet in the past three years. Now everyone can conveniently download software online and pay conveniently through mobile phones and bank cards, which is ahead of other security vendors. In the coming time, we will focus more on Internet security needs, which is the first keyword.

Sina Technology: Network.

Wang Xin: Second, mobile phones are increasingly integrated into our daily lives, and the protection of mobile phone security and privacy has become particularly important. Just a few days ago, everyone saw the news about the mobile skull virus, indicating that hackers have shifted their focus to mobile phones and wireless networks. We predict that the wireless Internet market will have explosive growth in the next three years, so our second business focus is also aimed at mobile phones. We have just released Mobile Guard.

Sina Technology: Kingsoft Mobile Guard.