Chinese Internet portal Sohu.com Inc yesterday linked with the online arm of the giant Walt Disney entertainment conglomerate for the development of mobile value-added services.

According to the agreement signed in Beijing, the first phase co-operation between the two companies includes mutual development of mobile messaging services and the construction and operation of Walt Disney's Chinese website.

"This is the most important co-operation we have had in Internet content and a great step towards the development of the content on our websites," said Charles Zhang, chairman and chief executive officer of Sohu, which is listed on the NASDAQ stock market in New York.

Sohu will act as Walt Disney's only online partner in China and build and operate the latter's Chinese website.

Victor Koo, chief operating officer of Sohu, said the two companies will share revenues from online advertising, mobile message downloading and game downloading on Disney's Chinese website, but he declined to reveal the exact portioning of those revenues.

Disney's Chinese website had been operated by Shenzhen-listed Sea Rainbow Holding Co Ltd since August 2001, but due to operational differences and lack of solid profit models the deal ended early this year.

Walt Disney will also authorize Sohu to provide 400 black and white photographs and more than 4,500 colour images of Disney cartoon characters like Mickey Mouse and Donald Duck on Sohu's mobile message channel.

"By the end of next year the multimedia messaging service (MMS) market in China will be spectacular and we must do it now to meet the tide. The co-operation with Disney will be a big help to our development in MMS," said Koo.

Koo said the partnership was only the beginning, and in the future Sohu will expand it to all areas of targetting individual consumers businesses.

(China Daily November 1, 2003)