Phoenix Tech is reporting that “reliable sources” have divulged Tencent and Youku are in late-stage talks to initiate cooperation. Supposedly, the agreement would see Tencent buying a significant share of Youku’s stock and turning over all of its video services to be managed by Youku.
Representatives of Youku would not comment on the rumors when we contacted them Wednesday afternoon.
The timing of this leak, coincidental or not, isn’t great for Youku’s biggest video rival Tudou, which just completed a successful IPO. Tudou’s stock will begin its first day on the Nasdaq in just a few hours, but now that debut may be overshadowed by news that the company’s biggest rival is in talks with Tencent, one of China’s internet giants.
Youku currently enjoys a significant lead over Tudou in market share, and the last quarter saw Tudou’s market share shrink even as its expenditures grew.
We’ll keep an eye on these rumors and update if they are confirmed or the situation changes.
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