Walt Disney is leading a group effort to buy into China’s largest bus-based digital media and advertising company, Bus Online. The investment would be peanuts for Disney, but the headache could wind up being jumbo sized because one of their investors in the bus deal, sources tell us, is Google.
Google threatened to quit China only a few weeks ago and the internet search giant is finalizing a deal that will let the U.S. National Security Agency (NSA) help it investigate the corporate espionage attack it thinks originated in the People’s Republic. China has warned the U.S. not to make politics out of the Google issue, but it may be too far into the saber-jangling season for that, with Barack Obama having announced fresh U.S. weapons sales to Taiwan in his State of the Union address.
Though Google’s stake in the Bus Online deal is said to be small, even smaller than the tiny investment this will be for media giant Disney, it could just be big enough to cause headaches for Mickey and Co.
Bus Online is leading China’s media and advertising charge into this busy area of mass transit. It had revenue of only about 314.5 million yuan ($46.07 million) in 2009, but is the exclusive partner of state broadcaster CCTV and the official Xinhua news agency media content in advertising on buses. Sources tell us that senior Disney executives are set to fly to Beijing to meet media regulators to discuss Mickey’s long-term development plan in China, including the Bus Online deal.
The consortium planned to buy a stake of between 30 and 40 percent in Bus Online for more than $100 million via a purchase of old and new shares to be issued by the company in private placements. In November, Disney made a breakthrough deal to build one of its signature theme parks in Shanghai, marking a major advance for Western media and entertainment companies seeking to crack the tough Chinese market. With Google aboard, though, will the wheels of that bus come to a political stop?