> 1.      Indefinitely delayed launch of WoW a disaster?
> (1)     Expectation of WoW was high as evidenced in the hike in NTES share
> price.
> (2)     Financial contribution of WoW to NTES probably marginal even
> without delay in launch given
> -       Winner’s curse in competitive bidding.  Another gaming co besides
> The9 and NTES was believed to be in the bid until final round.
> -       WoW a proven game in China and worldwide.
> (3)     WLK launch could be delayed significantly
> The approval for Burning Crusade, which is what NTES is apply for,
> could take 80 business days (20 for transfer plus 60 for content), not
> including time required for content change, or even longer if The9’s
> lawsuits are relevant.  Precedent is against NTES.  EA was sued in
> 2007 and approval of EA games were delayed for almost 2 years.  The9
> probably knows how to play this lawsuit game better than NTES/Blizzard
> as EA is a 15% owner of The9.  Furthermore, The9 might have a
> legitimate claim in WLK as, according to reports on the internet, The9
> localized WLK.  If that is the case, The9 might have localized Burning
> Crusade too.
> (4)     WoW gamers are flocking to Taiwan servers (to play WLK) and other
> games; WoW gamer unions crumbling.
> -       Granted, some WoW gamers are hardcore and they will return when NTES
> launches it.
> -       However, some of the gamers are playing WLK off of Taiwan servers.
> Discussions in internet forums suggest they are not interested in
> playing Burning Crusade, NTES’ initial launch, and by the time NTES
> launches WLK, they might be tired of WLK already.
> -       WoW gamers have been actively pursued by competitors.  Many WoW
> gamer unions dissembled as different gamers are already playing
> different games.

> 2.      FWJ (~70% of its gaming revenue) suffering, so is TX2
> (1)     FWJ merged servers dozens of times in 2nd quarter, not a good
> sign.
> (2)     On 6/9, FWJ experienced major bug that might have impacted the
> balance of the game.http://game.zol.com.cn/137/1371797.html
> (3)     FWJ servers and gamers were harassed by WoW gamers.http://www.yxnpc.com/2009-06-25/5JGP/05010279.html
> (4)     Launched in Jan, 2004, FWJ is aging.  LineKong hired 3000 people
> to promote its widely anticipated game, Hero, targeting FWJ gamers.
> Perfect World’s Fantasy Zhu Xian seems to be following suit as well.
> (5)     On 6/22, TX2 also suffered a major bug, causing servers down 9-30
> hours.http://games.qq.com/a/20090623/000371.htm
> (6)     Problems of FWJ and TX2 suggest NTES might be stretching its
> resources for WoW in sacrifice of existing games.

> 3.      Pipeline dependent on licensed games; disappointing self-developed
> games
> After FWJ in 2004, NTES is yet to develop an okay game.

> 4.      Insider sale, no share repurchase this year
> CEO sold a 1.6% stake (2M ADS) on 6/12/09.
> According to its annual report dated 6/30/09, NTES has not repurchased
> a single share this year even though it has a $100M share repurchase
> program in place 9/12/2008-9/11/2009.  NTES was as low as $17 in Jan
> 09.

> 5.      Valuation one of the highest in the industry, share price almost
> all-time high

> Am I missing anything?