Sohu.com (SOHU)

Recent Developments and Strategic Partnerships

On the product side, Sohu has been focused on not only the development and rollout of innovative and interactive Web 2.0/ community-based products, but also successfully integrating them with traditional text and picture into a uniform platform. For example, Sohu Blog Plus was successfully launched with “Fun and Personalization” features, allowing users to customize their blog front page and incorporate their favorite Sohu products.

In addition, Sohu continues to expand its online video content portfolio with new channels and exclusive content. We recently launched two new online TV-like channels specifically geared to delivering online video content, V Channel for entertainment and S Channel for sports. Both offer pre-set programming similar to traditional TV broadcast timetables, but also allow users to access select programming on-demand.

As an integral part of Sohu’s strategy to provide China’s online users a comprehensive platform with premier, differentiated and exclusive content, Sohu has continued to secure key partnerships for exclusive sports-related content. In addition to video highlights from China Football, China Basketball Competition, select European soccer matches and Eurosports, on September 2^nd, we announced a multi-year partnership agreement with the NBA to provide basketball fans in China 24 live NBA regular season webcasts (not available on TV in China) for the first time, along with nightly game recaps.

Another important initiative for Sohu is a strategic cooperation with China Interactive Sports (or “CISports”). CISports owns substantial and significant resources relating to athletes and is backed by the China General Administration of Sports, which in turn manages all sports associations as well as Team China. We recently entered into a multi-year agreement with CISports to jointly manage and operate all its underlying websites, including www.sports.cn, www.sport.org.cn, the official website of China Olympics Committee www.olympic.cn and other official websites for various sports associations, as well as the official websites and blogs for famous athletes such as Liu Xiang. We will also produce and deliver online video content surrounding such athletes. Together with our Olympics sponsorship, this represents the final yet key strategic milestone in our Olympics/ sports strategy.

“Our ability to remain a leader in China’s growing online community has come from two areas – product innovation and premier content. Combined, Sohu’s brand name has increasingly gained recognition and traction with online users and advertisers. We have also been able to secure key strategic partnerships in order to build on the sports momentum that will continue to thrive in China from now through the 2008 Olympics, which has allowed us to cultivate a strong following for our sports offering. Our vision to build Sohu to be an international portal for Chinese users everywhere is rooted in our deep understanding and knowledge of what online users want not only now, but in the years to come,” concluded Dr. Zhang.