Sina.com today released news that The9 (NCTY) has secretly signed an agreement with Shanghai Alliance Investment to take over 50% of the stake of MSN China for half of msn’s estimated value (200million). According to report:

“不太可能”，不少分析人士对该消息皆称“惊讶”。不过，据消息人士透露，上述交易可能牵涉微软与九城间更深层次的资本合作，“其模式或类同当年雅虎与阿里巴巴的‘雅巴组合’”。如此来看，接盘背后九城与微软可能皆有更庞大的战略阳谋。

there is a likelyhood of a similar cooperation as that of Yahoo and Alibaba. Microsoft previously released news about potential sell of back at the beginning of September due to lack of progress in recent years (since 2005) in its search and wireless strategy.

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In a continuing series of personnel losses, including Li Kaifu (to eBay) and Kai-Fu Lee (to Google), Microsoft today lost another member: Timothy Chen. Microsoft’s China Corporate Vice President (uh…) is said to leave for NBA where he will lead the further development of infrastructure and operations (as if that’s the reason they needed to grab one of the top international exec.)

Microsoft had, of course, stuggled with building important goverment relations ever since they ignored mainland China and instead opened a center in Taiwan - Chinese government never forgot

Mr. Chen, a Taiwan born, certainly comes with a taste for pedigree – previous roles included: VP of Motorola (China), CEO of 21CN Cybernet Corp, and U.S. based Lucent Technologies (then AT&T Inc.). Not to mention his MBA from University of Chicago – a typical story of successful Chinese American returnee.

What about NBA? To make it short, NBA in China is huge. Over 300 million people play basketball - and nearly all of them have high awareness of NBA brand. Of course, in a country where television is not much of a show, NBA Chinese web site plays a key gateway to basketball footage.

Once again, a company that put tremendous resources in building its human capital is falling apart and losing its key leaders in the meantime.

more from reuters

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A short-lived two-year partnership between MSN and Shanghai Alliance Investment today has come to and end. The Chinese partner apparently cites discomfort with Microsoft’s revenue model, and bashes the company’s reliance on mobile operators.

Alliance Investment has been actively looking for a buyer of its share since mid-2007, according to the 21st Century Business Herald. A source close to the situation told the paper that Alliance Investment wanted to make the sale due to its worries that MSN China had failed to find a clear revenue model, though Alliance Investment may give up on its exit plan if it fails to get a good price for its stake.

All may sound reasonable but let’s not forget the user base that Microsoft owns in China. Sure, MS might not have the most popular mobile IM service (QQ is leading the pack), but they definetely have the majority registered on their msn spaces, windows messenger, email, etc… Besides, which international company is making money in China on advertisement right now? Yahoo? Google? All of them have yet to develop an appealing case for businesses. Alimam might be one but by the time they go mainstream, there just might be already plenty of competition from Sohu, Baidu and Sina.

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