国内两家电子商务网站巨头开始“正面交锋”。继阿里巴巴高调宣布进军行业网站领域后，A股市场“纯网”第一股网盛科技8日宣布：正式推出基于行业网站联盟的大型商业门户与搜索平台－－“生意宝”（www.NetSun.com）。业内人士表示，“生意宝”的亮相，是网盛科技董事长孙德良迎战这场“交锋”的接招亮剑，一场可能影响整个国内B2B市场格局的颠峰对决已然登场。 据透露，网盛科技已于近日在国内约1000家网站上打出了“中国互联网第一股，携手专业网站共赢天下”的大幅广告，为“生意宝”登场造势。网盛科技孙德良表示：“生意宝”（www.NetSun.com）是建立在行业网站联盟基础上的平台，同各行业网站是平行共赢的合作关系。据悉，目前已有数百个行业网站表示对加盟“生意宝”兴趣浓厚。
今年2月6日，网盛科技宣布将在中国专业网站中精选100家合作伙伴，共同打造100个类似“中国化工网”的行业龙头网站。仅仅一个多月后，阿里巴巴于3月21日透出消息称：将在未来几个月内，与优秀的行业网站展开“全面深入的合作”。至此，总部同在杭州，原本井水不犯河水的网盛科技与阿里巴巴两大电子商务巨头，终于在行业网站领域交上了手。分析人士指出，此次随着“生意宝”的登台亮相，表明行业网站巨头网盛科技与综合电子商务网站巨头阿里巴巴的角逐，终于由“暗战”走向“交火”，双方的主战场正是在行业网站领域。
根据资料，国内行业网站大多是在2000年前后发展起来，但过去由于其专业性强，除了行业内人士外，公众对此知之甚少。而据最新的数据统计，中国行业商务网站已经超过2000家，2006年总体的服务收入超过了100亿元，就业人数超过12万人。巨大的行业网站商机，已然成为兵家必争之地。
从双方公布的信息看，虽然同是寻求与行业网站的全面合作，网盛科技与阿里巴巴在理念与方式上迥然不同。“生意宝”（www.NetSun.com）作为行业网站联盟的电子商务门户及生意搜索平台，对参与合作的行业网站不设有盈利要求的门槛，而主要看团队实力；网盛以参股方式与相中的伙伴进行合作，并为其提供技术、内容、品牌推广等的帮助，目的是将网盛的成功经验推广到其它行业网站，达到共赢。而“阿里巴巴”则主要通过整合商业资讯，让各合作网站共享其商业流量，进而达成合作。
对于两种不同的合作模式，网盛科技董事长孙德良表示双方“各有优势”，并强调“生意宝”（www.NetSun.com）的基础是行业网站联盟，通过优势互补共同做大市场。
专家分析，仅就目前双方已披露的信息看，网盛科技显然更占优势，其方案的成熟度、可操作性均较高。由于网盛科技本身就是行业网站从小做大的范例，过去10年先后成功打造出中国化工网、中国纺织网、医药网等多个国内知名的行业网站，在行业网站领域的经验、技术与资源等优势明显，显得成竹在胸。比较而言，阿里巴巴在综合电子商务领域明显具有强势，而在行业网站领域相对是个“新手”，因此其涉足的步伐也有些小心翼翼。
Ninetowns Internet Technology Group Company Limited
(NasdaqGM: NINE) provides enterprise software designed to streamline
the import/export process in China. Ninetowns’
software allows its customers to complete import/export documentation
over the internet. The company first introduced this software in 1995
and it gained a first mover advantage enabling the company to steadily
grow revenues and profits until 2005.Ninetowns has a market cap of $140 million, cash of $116 million and
no significant long term debt. The trailing P/E is about 24 and the one
analyst that follows Ninetowns predicts a loss of $0.02 per share in
fiscal year 2007.
In August of 2005 the business outlook for Ninetowns changed dramatically when the State Administration for Quality Supervision and Inspection of the People’s Republic of China (PRC Inspections Administration) decided to create a free e-filing software package to facilitate the import/export process in China. Although the PRC Inspection Administration hired Ninetowns to provide the new software, the PRC Inspection Administration paid Ninetowns a paltry 400K for their services and Ninetowns was forced to offer a scaled down version of their core software product for free.
Since the introduction of the free e-filing software, Ninetowns has struggled financially. Revenues and profits have dropped consistently including in a recently reported loss in the fourth quarter of 2006. Although Ninetowns has been able to increase the number of service contracts and premium services sold, this increase has not offset the revenue lost due to the free software option now available.
With the B2G business at Ninetowns struggling, the company has been looking for other business opportunities. Considering Ninetowns current customer base of over 130,000 businesses involved in import/export transactions in China, a B2B business that leveraged this customer base was the obvious choice. In September of 2006, Ninetowns acquired a 16.25% interest in Global Market Group Limited, a Chinese B2B trade facilitator. Although this was a positive sign, this investment did not show investors that Ninetowns was fully committed to a strategy change to the B2B market place.
In late 2006, Ninetowns launched tootoo.com, its first full featured entry into the B2B marketplace. Although financial results have yet to be reported for tootoo.com, a look at the Alexa ranking shows that tootoo.com is experiencing significant traffic. Tootoo.com has a current Alexa rank of 2,045 compared to a rank of 2,098 for competitor Global Sources, 374 for MadeinChina.com, and 97 for Alibaba.com.
Although a high Alexa rank doesn’t necessarily translate into revenues and profits, the quick jump in traffic at tootoo.com does show that Ninetowns has the ability to leverage their current customer base.
A few weeks ago Ninetowns announced the next step in its B2B strategy. By acquiring Baichuan, a leading Chinese vertical search engine, Ninetowns plans to offer industry specific web search for suppliers and buyers engaged in Chinese international trade. In order to enhance the quality and relevancy of search results, Ninetowns plans to use the supplier verification technology from its existing iDeclare and iProcess service platforms.
The Baichuan acquisition allows Ninetowns to merge tootoo.com with Baichuan’s yaphon.com. Baichuan has entered into alliances with more than 30 Chinese B2B portals with access to 400,000 suppliers and 1.5 million products. Baichuan also introduced the Total Quality Sourcing [TQS] ranking algorithm to improve search result relevancy and quality. By combining TQS and Ninetowns supplier verification system, Ninetowns hopes to gain a competitive advantage over the competition by focusing its search results on companies that have passed multiple quality standards.
Although Ninetowns core software has been hurt significantly by the introduction of the free alternative, the fourth quarter results have finally stopped the downward spiral of revenues. On a year over year basis, the fourth quarter of 2006 had a significant decline compared to fourth quarter 2005 results, but revenues actually increased from the third quarter of 2006. This increase was due in large part to increased sequential sales of iDeclare packages (+300) and iDeclare service contracts (+5,500). The net loss reported for the fourth quarter was largely due to increased spending on R&D for the new B2B platforms (+$779K).
Although there is no guarantee that the new B2B strategy at Ninetowns will be successful, Ninetowns has some unique advantages in this field. By leveraging its current customer base and utilizing the only Chinese developed vertical B2B search platform, Ninetowns can rapidly grow internet traffic while having a better understanding of local business customs than the foreign competition.
On March 22, 2006, SEC from SC 13G was filed for Ninetowns showing that Netease, founder and CEO Lei Ding purchased 3,070,028 shares in Ninetowns representing about 9% of total shares outstanding. This shows that at least one prominent investor, knowledgeable in Chinese on-line businesses, has confidence in Ninetowns.
The core B2G import/export software business at Ninetowns appears to have stabilized and with increased premium services, this business should make a small profit or at least break even going forward, but the real potential in Ninetowns is in B2B. Although revenue projections are impossible at this stage, competitor Global Sources (NasdaqGS: GSOL) has had rapid growth in profits and revenues recently. Although Global Sources relies heavily on sourcing fairs to facilitate transactions, Ninetowns has the potential to succeed without sourcing fairs if its search results can accurately provide quality import/export leads.
At Wall Street Mayhem we think Ninetowns has a compelling valuation at current prices. After backing out the cash, Ninetowns has an enterprise value of only $24 million. Considering the strategic B2B advantages Ninetowns enjoys due to its extensive customer base and its ability to integrate quality measures into B2B search results, Ninetowns has the potential to make a significant impact on the B2B market place in China.
