SINA and NCsoft Enter Definitive Agreement to Form Online Game Joint Venture in China

Joint Venture to Operate and Market Lineage, One of the Most Successful Online Games in the World With Over Four Million Subscribers

Online games, which generate revenue from the subscription fees paid by players, is one of the fastest growing sectors of the interactive entertainment industry in the world. In particular, Massively Multi-Player Online Role Playing Game (or "MMORPG") is the "stickiest" form of online games in which hundreds of thousands of players interact with one another concurrently online. This type of game focuses less on eye-hand dexterity and more on interaction with real human players in real time. The games create loyal followings with significant network effects as more and more gamers form communities and relationships with one another. According to Forrester Research, the market for online games constituted about 5% of the total game software market in 2001. However, it is expected to grow at a much faster pace than the rest of the game industry and to reach $5.3 billion in market size by 2005.

In Asia, the total online game market was estimated to be $450 million in 2001 with most subscribers concentrated in Korea, Taiwan and Japan. However, in recent months, China, with its fast growing Internet population (already at 45.8 million users according to CNNIC's July survey) is expected to become the largest market in the region in a relatively short period of time. According to CCID, a consultancy under China's Ministry of Information Industry, the number of online game players will reach 9.7 million by the end of 2002 and 14.3 million by the end of 2003.

"Online games have already become one of the fastest growing sectors of the Internet economy in China. As the leading Internet portal, we are honored to partner with the number one online game company in the world to bring the best online games to China," said, Daniel Mao, CEO of SINA. "With this joint venture, SINA has further transformed from a leading Internet portal into a truly diversified leading online media, entertainment and value added service company with multiple revenue sources from advertising, subscription and fees."

"SINA is a progressive company," said Tack Jin Kim, CEO of NCsoft. "It is listed on the NASDAQ exchange and has the experience and determination to become the number one player in the online game business in China. We believe SINA is the best partner for us to enter the Chinese market. We look forward to a relationship which will introduce a new and exciting era of online gaming to China."

Introduced in September 1998, Lineage quickly became a blockbuster hit in Korea and has won multiple awards in Korea and the world. After its successful introduction in Korea, Lineage has been introduced into other Asian markets including Japan, Taiwan, Hong Kong and the U.S. In Korea and Taiwan, two of the most mature online game markets in Asia, Lineage controls close to half of the total markets. In 2001, Lineage grossed nearly $200 million in revenue.

"We are very excited to introduce Lineage to China. The online game enthusiasts here have been eagerly awaiting the launch of this game for a long time," said, Yan Wang, President of SINA. "SINA has long been recognized for operating the leading game channel in China. With our unsurpassed strength in online game marketing and NCsoft's superior game operations and development capabilities, we are bringing the leading online game in Asia to China, and are providing the best service with qualities that will exceed all of our competitors."

About NCsoft

About SINA