Chinese online video website Ku6 Media Co., Ltd. (NASDAQ: KUTV) will continue a user generated content (UGC) strategy.
It said in the evening on June 3 that Du Fang, the former deputy director with Zhejiang Stellite TV, would take the place of Shi Yu to serve as its CEO.
It always carried out a UGC strategy in the term of Shi and recently, Shi said in a letter to staff that his step-down would not deliver an impact on the strategy.
Prior to this, it just released financial results for the first quarter of this year and according to the results, the operating revenue hit USD 3.07 million, or about CNY 19.06 million, down 34.4 percent from a year ago and 8.4 percent from a quarter earlier and compared to USD 83.1 million of Youku Tudou Inc., the biggest online video website in the Chinese mainland. And the net loss reached USD 1.67 million, or about CNY 10.38 million, down 6.5 percent from a year ago.
Due to the poor performance, it always saw share price fluctuate at about USD 1. In line with industry observers, in order to make a breakthrough in operating revenue, it named Du as CEO and it has been unknown whether the move will work.
Shi said in an interview in January this year that it did not want to depend much on Shanda Interactive Entertainment Ltd. and would open the financing door for external investors. And in line with industry observers, a major reason for it to reduce dependence on Shanda Interactive is that the latter has changed its strategy since it delisted from the US stock market in early 2012.
Shi was named CEO of Ku6 Media in August 2011 and the nomination was regarded as a new start of the firm. It was a fact that it had got listed through a back-door listing. However, it was still laid behind by archrivals including Youku Tudou. Notably, its capital-driven copyright mode had delivered a strong impact on other innovative businesses of Shanda Interactive. In addition, Shanda Games Ltd. (NASDAQ: GAME), the online game unit of Shanda Interactive, suffered a slowdown. Under such an environment, Chen Tianqiao, chairman of Shanda Interactive, said that Ku6 Media should shift into a mode based on communities and UGCs from the capital-driven one.
Shanda Interactive, a leading online game developer and operator in the market, has invested about USD 200 million in Ku6 Media since it put the Nasdaq-listed firm into pocket in 2011.
