2010-09-14 16:35

China's two leading Internet video sharing sites, Youku and Tudou, are in a race to be the first to make an offshore IPO to raise funds to compete against each other, Bloomberg and Reuters reported Tuesday.

Capital was a huge requirement in the online video industry and the leading players have to raise all kinds of money, Tudou's Gary Wang was cited by Bloomberg as saying. IPO was inevitable and should happen fairly soon, he said.

Reuters said both companies have hired investment banks, and Tudou could launch its initial public offering by the end of the year.

Another source told Reuters that the IPOs were more likely to take place in or after the first quarter of 2011.

But both Tudou Chief Executive Gary Wang and Youku Chief Executive Victor Koo declined to comment, according to Reuters.

Youku's Koo told Bloomberg that China has 420 million Internet users and about 75 percent already watch videos online at a preferred site.The period of most rapid growth in new users is already done, and now websites must expand mainly by winning market share, he said.