The Development Strategy Of China Portal Website

Along with the development of Internet industry,Portal,one of the Internet business model,has gone through from formation,rapid growth to searching profit oriented business model under the pressure of market economy.The business model of Portal was defined as capital injection from venture capital plus Internet advertising. Yahoo is the leading example in the global basis. SINA,SOHU,and NETEASE are leading examples of domestic Portals. They have experienced exponential growth in the areas of registered users,page impressions,and advertising revenue. All SINA,SHOU,NETEASE went public in the United States and got listed on the NASDAQ exchange.Under the "VC + Internet advertising" business model,Portals objectives were set to gain users and grow its traffic by all means. Therefore,on one hand,portals allocate lots of budget on marketing campaigns in order to build brand awareness among Internet users. On the other hand,in order to better serve its users as well as attract more users,Portals have invested lots of capital to get more content,services,and most updated infrastructure. AH the efforts were to secure higher advertising revenue through delivering higher "banner-click-through" to advertisers. However,this single source of income is not sufficient to cover expenses. In other words,Portals were experiencing net loss under this single revenue stream model.This situation has last till April 2000 when the Internet bubble burst. When Nasdaq index fell to around 2000,it represent the capital market has seriously challenged portal's "single revenue source" business model. Under the tough market condition,Yahoo as the leading Internet portal has started to adjust its strategy in order to build a new revenue model.In order to tackle this issue,Portals,both international and domestic ones,have taken various strategies and approaches in accordance with its own strengths and competitive advantages. However,they all followed the common trend,diversified operation and adopted a subscription model to reach one goal:decrease the dependency on online advertising revenue as the single income source.This thesis will first compare and analyze various developing stages and current development of leading international and domestic Portals. This thesis will also summarize and conclude Portals development strategies,and will discuss its future strategies.