Shulou(Shulou.com)11/24 Report--

On December 8, 2010, New York, which had been trapped in a snowstorm a few days ago, began to clear up.

On this day, "Big mouth" Francis Chan rang the bell twice on the New York Stock Exchange, meaning "Dangdang", opening the door for Dangdang's listing in the United States. By the close, Dangdang was up 86.94%, and Francis Chan cashed out $20.8 million that day. But even if the data are so eye-catching, Dangdang is not in the middle of the stage of the day.

At 09:30 on the same day, Youku President Victor Koo pressed a button to symbolize the opening bell of the New York Stock Exchange. Youku recorded the largest daily trading volume since Baidu, with a market capitalization of nearly US $3 billion, making it the first video site in the world to go public independently. Eight months before Youku went public, Gong Yu, the former CFO of gu Yongqiang, a former subordinate of Sohu, made a "strange" video in a corner of Beijing. Half a year later, Jia Yueting, who had not yet built a car, took his Letv to ring the bell at the Shenzhen Stock Exchange and became the first A-share online video company.

Unlike gu Yongqiang, who almost ate all the way back from the United States, Wang Wei, founder of Tudou, is a little sad. The initial public offering prospectus was originally submitted six days earlier than Youku, but 38% of the shares were frozen due to a divorce petition from the boss's wife the next day, forcing the listing plan to be shelved. A year later IPO, bleeding listed Tudou, in the face of Youku, which is not the same as Youku, found that this piece of rivers and lakes has already changed. In 2012, Youku bought Tudou and Wang Wei was out.

It was also from the beginning of this merger and acquisition that in order to fight against the leading Youku, various platforms rose together, and in order to suppress the rising iqiyi, Youku chose to cooperate with each other and formally opened the "warring States" era of China's long video website: in October 2013, PPTV sold himself Suning; in June 2014, the video of iqiyi merging PPS; Sohu got up early in the morning, caught up with an evening collection, and gradually died down. After the rise of Letv, he lost Maicheng with the chicken feathers of Jia Yueting.

Gu Yongqiang guessed the beginning, but not the end: in 2016, Youku, which has been losing money for years, was privatized and became an Alibaba subsidiary. Youku delisted and Gu Yongqiang turned and left. Two years later, iqiyi went public in the United States and followed the path Youku took that year. Gong Yu waited for eight years at this moment.

As the only two winners in the field, iqiyi and Tencent Video, who had just turned the traditional TV media into a weak side, thought they had cleaned the battlefield, but they were hit head-on by short videos before they turned around to catch their breath. with the rise of Shake, the industry rules were completely rewritten. As the darlings of the PC era, long videos began to be unaccustomed in the mobile era, still unable to end this unlimited game and gradually become the abandonment of the times.

01. The vanguard of the ebb tide will not even say goodbye when the times abandon you.

Two days ago, Tencent claimed 3200 million yuan of Douyin tort fees, causing an uproar, and the war over the length of the video started a prairie fire.

According to the Statistical report on the Development of the Internet in China, as of December 2021, the number of Internet audio-visual users in China was 975 million, of which 934 million were short video users, and the penetration rate of short videos was as high as 95.79%. It is obvious that the original attention economy is being reconstructed. unlike the previous video "warring States" scuffle, this long video faces unprecedented challenges.

The progress of science and technology has brought higher efficiency of information exchange, and users' requirements for information content per unit time have also increased. On the other hand, the fragmented time, resulting in fragmented entertainment and social needs, changes in user needs, will inevitably affect the industry environment, followed by the iteration of the business model. Short video obviously arises at the historic moment based on the above requirements.

Although the potential is like water and fire, but in essence, the two business models are not the same, long video is a "content" business, short video is a "traffic" business.

On the other hand, the current business model of long video is still a set of games in the era of PC, relying on the traditional way of advertising placement and member subscription. It still pursues the realization logic of advertising charge → time payment → content payment, but there is a general lack of awareness of content payment in China, coupled with rampant piracy, content payment has been an ideal model that has not been formed since the television era.

There is a saying in economics: resources are always scarce. There is no shortage of content in the current era, but good quality content must be scarce resources. As a content platform, the core competitiveness of long video-content, but still not formed a high-quality content scale, to further pry the growth and profitability of the flywheel. On the contrary, the long video platform, which often goes to traffic play, is full of a large number of shoddy content programs, reducing the stickiness of user payments, not to mention the advantage of platform tone and high-quality content scale.

In the ebb of the Internet tide, advertising, e-commerce and games are the three ways to make a profit, and only the platforms that rely on backward models to achieve profits are eliminated. Youai Teng may be the first batch. First of all, take a look at the long video depends on the financial pillar-advertising, because of its content form, whether it is the frequency of advertising, or accurate distribution of recommendations based on algorithms, can not be compared with short videos.

On the other hand, the long video itself is very difficult to carry social behavior, although the major platforms have launched the function of on-screen comment, but similar to bilibili's strong community cultural attributes, Youai Teng obviously does not have. The lack of social community genes also leads to the troika where user traffic is most easily realized commercially: e-commerce, games, advertising, e-commerce and games are difficult to get the right business soil in the field of long video.

For example, when it comes to content e-commerce, we often shake fast, Little Red Book, Weibo and other short videos or community content platforms, while long videos are one step behind in terms of entry time and volume. When the fast live video has gone deep into the hinterland of traditional e-commerce, long video is still pacing around derivatives selling content IP, or variety belt goods that are still being tried, such as bilibili's member purchase, iQiyi station selling "iqiyi Mall" around Film and Television, Hunan Satellite TV Variety, brother "100Daoguang" and so on.

Looking overseas, even when global streaming giant Netflix tried to launch online e-commerce platform Netflix.shop in June last year, it started with selling IP peripheral products. Obviously, the conversion efficiency of long video as an e-commerce business is really unflattering.

In terms of games, first, it requires a lot of capital investment, which means a lot of financial pressure for the long video that has lost money for years, and whether it can make a good game is still open to question. In addition, even if you make a game, lack of social attributes and traffic, how to break the circle of the game is another problem, and finally fall into the dilemma of buying games.

The essence of the Internet is link, while the essence of computer is efficiency. It is true that the dividend of the Internet industry is fading, but it is still too early to say that it will die out. The industry track in an industry always dies in sequence, and the industry that is the first to be eliminated must be the industry that does not adapt to the changes in the industry. This also confirms Darwin's view of evolution: natural selection, survival of the fittest.

Long video platform to do e-commerce has not been transformed, there is no scene for games, no frequency of advertising, no advantage in doing content, if the Internet wave is receding, then long video must be in the vanguard. Just like the TV programs at that time, those who go against the trend of the times will eventually come to the brink of extinction. This is the choice of the times, will not be transferred by the will of people, today's long video has obviously drifted away on this road.

02, the upper and lower dilemma "you Aiteng" upward is a series of losses and burning money, sitting in vain, behind the BAT complaining bitterness, sprouting withdrawal; down is the flow star in charge, the content is crude, the platform audience from love to hate, curses repeatedly; you Aiteng people are sandwiched between the dilemma.

Business is a long run, Youku is the first to start, but also the first to fall behind. In terms of market share, when Youku Tudou merged in 2012, they had a market share of 25 per cent and 24 per cent respectively; by 2016, when Alibaba bought Youku Tudou, Youku Tudou was still second in the industry with 47 per cent penetration.

According to the 2021 China Network Audiovisual Development Research report, as of December 2021, the number of monthly active users of iqiyi, Tencent, Mango TV, bilibili and Youku were 500 million, 490 million, 190 million, 180 million and 170 million respectively. Youku slipped to the fifth place in the long video platform, with a market share of only 20%, performing the miracle of No. 1 / 2 = 5 in the industry.

In terms of the size of paying users, by the end of 2021, Tencent had 124 million paying users and iqiyi 97 million, while Youku has chosen not to publish specific data on a regular basis since 2017. In terms of product content, among the TOP20 series broadcast on the whole network in 2021, iqiyi has 12 and 6 alone; Tencent Video has 14 and 8 alone, while Youku has only 5, all of which are spelling broadcasts.

Loss-making Youku is unpopular, but iqiyi, who is not necessarily profitable, has no worries. As of Q2 in 2022, iqiyi has made operating profits for two consecutive quarters: Q1 of 169.1 million yuan and Q2 of 78.3 million yuan.

According to the financial report, iqiyi's operating costs have been negative for three consecutive quarters, while the cost of Q2 content is only 3.9 billion yuan, down 24% from the same period last year. On the other hand, iqiyi abandoned the marginal business in non-core departments such as games, novels, and short videos, and made a small profit by reducing costs by laying off staff many times.

Among the three major sources of income (advertising, membership, content distribution), only one member service showed positive growth, but this is not due to the increase in the number of paying subscribers. On the contrary, iqiyi's average daily subscription membership decreased by 3.1 million month-on-month in 2022. The total number of members has fallen below 100 million again since Q4 in 2021, to only 98.3 million.

Iqiyi raised the ARPU by raising the price of its members. In fact, the charging standard of the platform is not low, because whether it is expensive or not is a relative concept, which depends on the selection of the frame of reference.

Take Netflix as an example, the price of Netflix membership is 8.99 to 17.99 US dollars per month, accounting for only 0.55 percent according to the US per capita disposable income of 3200 US dollars in 2021. Iqiyi's membership price is 15,30 yuan per month, which is about 1.3 percent based on China's per capita disposable income of 2930 yuan in 2021, which is almost 2.5 times that of Netflix.

Therefore, in the case of the ceiling of user growth, only relying on the price increase of members is tantamount to drinking poison to quench thirst, and it is not sustainable. "to increase revenue and reduce expenditure", iqiyi actually only achieved "cutting expenditure". Investors voted with their feet, and iqiyi's share price has fallen 47.9 per cent so far since it reported its first profit in May.

In June 2022, there were rumors that Baidu planned to sell its 53% stake in iqiyi, valued at 47 billion yuan. Although iqiyi immediately refuted the rumor, there were such rumors about the first profit after 12 consecutive years of losses. it's hard not to doubt whether Baidu is waiting for sale.

First, money was burned for growth, and the market was pessimistic, so it was not easy to reduce costs and increase efficiency to achieve profits, and they had to make the choice of "choosing one of the two" for growth and profits.They also faced the pressure of being sold at any time, and iqiyi became even more anxious after making profits.

At present, Tencent Video's situation in Youaiteng is not so embarrassing. Although long video has been losing money, and unlike social networking and games, it is the basic disk of Tencent, but Tencent wants to build a whole ecosystem of "IP (novel)-content (anime game)-communication (announcing and discussing two creations)" as an important carrier of "content" in the ecosystem. Tencent Video will not be given up for a while.

However, the fact that the company is willing to accept it does not mean that users will buy it. In 2022, the number of paid members of Q2 Tencent Video was 122 million, down 2.4% from the same period last year and 1.6% from the previous year. This is the second consecutive quarter of Tencent Video's decline in the number of paid members compared with the same period last year. Iqiyi's total number of paid members has also been hovering around 100 million.

Again, the point above: no one will reject really high-quality content. It is obvious that the existing content of the domestic long video platform has gradually failed to support users' demand for high-quality content. Is it because they are poor to give up male audiences in domestic dramas in the new weekly? In this article, there is such an interesting argument: domestic dramas are resolutely shutting out male audiences.

Judging from the fact that American TV series such as Game of Thrones, Breaking Bad and House of Cards have so many fans in China, it is not difficult to see that male users do not like watching TV shows is a kind of prejudice at all. However, the home page recommendation of domestic video platform is often very serious homogenization of ancient costume CP, or flow star Baping water injection drama, "Daming 1566" and other in-depth works are almost extinct.

The video platform deliberately caters to the practice of traffic stars, and the result is that male users who also have good spending power are gradually being persuaded to quit, while female users will gradually reduce their desire to pay due to long-term aesthetic fatigue.

When the president of Ali Culture and Entertainment in 2017 openly said: "We big data analyzed, the audience does not care about what plot, what special effects, we just like to watch traffic stars!" Now that the long video platform is gradually being abandoned by consumers, such professional managers are to blame.

03, destroyed by professional managers: China is not short of rich people, but lack of professional managers. I am a professional manager, this is my self-confidence. This sentence has always been Wang Shi's creed before he was kicked out of Vanke.

When the enterprise develops to a certain extent, it is undoubtedly a wise choice to introduce professional managers. However, the formation of management team and corporate culture must be based on the mutual trust between shareholders and professional managers, which determines the success or failure of corporate governance and the scale and speed of enterprise development.

The author has discussed with Vanke managers about professional managers, and in his opinion, the advantages and disadvantages of Vanke's professional manager system are very obvious: "the advantage is that the work efficiency is very high, and there is basically no phenomenon of prevarication and bickering. Because Vanke does not allow brothers and husband and wife to take office at the same time, the professional manager system can save a lot of the human skills of the original family business, but the disadvantage is that sometimes decision-making is too short-sighted. There are very few long-term decisions.

Professional managers need to be accountable to the board of directors in order to ensure that their work in the coming year is secure, so they tend to think only in their own interests, regardless of the flood behind them, which seems to be confirmed by the long video website.

Wang Wei, founder of Tudou, has a famous prophecy: "UGC is all industrial waste water." However, the other arsenic, my honey, Youku, which has changed management after the merger of Tudou, has always focused on UGC, when the trend of the industry has quietly shifted to the dual-track model of member payment and PGC. Later, when Youku turned back to platform homemade content, it was found that it had been left behind for a long time. In 2014, Youku had no choice but to find allies. In addition to Ali, Tencent also offered an olive branch.

Another thing that has been circulating in the outside world is that Ma Huateng actually agreed to sell Tencent Video and hopes to buy a stake in Youku Tudou using a similar model as JD.com and Sogou, and hand Tencent Video over to Youku to ensure that he does not lose his video business.

According to a report by Leifeng net, Sun Zhonghuai, then the CEO of Tencent Video, because he was worried that after selling his body to Youku, the first place belonged to Gu Yongqiang, so he and several senior executives, such as Liu Shengyi and Wang Juan, flew to Hong Kong overnight and issued a military writ to take Tencent Video to the second position in the industry. Later, Li Hao, the former president of 56 net, said with regret that if Tencent had formed an alliance with Youku at that time, the end of China's long video war would have been over.

And Youku life is not easy after selling Ali. Since Yu Yongfu succeeded Koo Yongqiang and became the president of Ali's entertainment plate, Youku changed coach three times in four years, and experienced three stages of integration of Yu Yongfu, radical Yang Weidong and Fan Luyuan.

Among them, as the founder of Amoy ticket, Fan Luyuan was born as a product. As soon as he took office in 2019, Youku overturned Yang Weidong's policy of opening and closing, and put forward the content strategy of "three wants, three don't", that is, "No extravagance, no efficiency, no idols, no actors, no flow, no value." Three terms in charge, three styles, Youku is also declining year by year in this change, no longer the glory of that year.

On May 28, 2020, Wang Xing blasted on whether to eat or not: "Ali giving up big entertainment is already a thing that can start the countdown." Although at that time, Ali Entertainment quickly said, "it is a pity that Meituan does not open a teahouse." Go back to the past. However, judging from the recent performance of Ali Entertainment, it is possible that Wang Xing's words will really come true in the future. Although Jack Ma has repeatedly stressed the need to give Ali Entertainment 11 years, nine years have passed since 2013. For Fan Luyuan and Ali Cultural Entertainment, the time left for them may be running out.

Although Gong Yu has also become a professional manager, he is after all the founder of iqiyi and has a special affection for the product. In 2016, because of the privatization of iqiyi, the team also made several appointments with Ma Dongmin, the wife of Baidu boss, and repeatedly ran around the streets of Beijing. In 2020, it also resumed negotiations with Tencent, although the results still came to nothing. It is worth mentioning that for the failure of this merger, external rumors are the same as last time Youku, also because of Sun Zhonghuai's strong opposition and finally had no choice but to give up.

Even if bilibili's Chen Rui is still unwilling to take out the killer mace of patch advertising, bilibili may have changed if he were a professional manager, and China's long video industry would have had a chance to put an end to this chaotic situation. but it was destroyed by these professional managers after all.

Writing a long video at the end is like an aging passer-by, watching the social, e-commerce and games of the same era still shine, and enviing the "waves" such as live streaming and short videos to catch up, like a fish in the water, left alone in the corner of the times.

Some of them fell off the throne and lost their glory; some were in a high position, but they had a new melancholy; some lost their way in the midst of applause, and some watched hard to stick to a little style.

Taking into account the shift of users to short videos, the growing positioning of BAT by long video business, and the inaction of professional managers, Youai Teng has fallen into a situation where "no one cares" and may eventually become the first footnotes for the Internet tide to recede.

For devout believers who witness at dusk, perhaps the long videos can no longer keep up with the pace of the times, but no matter what happens to you Aiteng, the high-quality content is always worth our quiet and careful taste.

* the problem pictures and the pictures in the article come from the network.

This article comes from the official account of Wechat: new position NewPosition (ID:xinlichangNP), author: VV, Editor: Li Fan

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