From the scuffle of hundreds of video websites in the PC era, to bat reshaping the video industry, to the sudden rise of short videos, new and old players come and go like a wave. While the industry is moving toward compliance, the film and television copyrights that have been intentionally or unintentionally ignored by websites have become a weapon for platforms to attack each other.
However, what needs to be faced squarely is that what prevents the profitability of domestic long video platforms is not only the massive "two creations" of short video platforms, nor is it not only the pirated version that cannot be killed, but the market environment that has been cultivated by video platforms themselves for a long time.
Video site chaos just opened
In 2006, Google acquired the overseas video site YouTube for $1.65 billion. The seemingly unrelated merger with China, like a butterfly fluttering in the Atlantic, has brought a far-reaching tsunami to distant regions.
Prior to this, leTV, Tudou, 56, excitement and other video websites were launched not long ago, and the average daily visitors of the most beautiful Tudou and 56 networks just exceeded 40,000 people.
When the news of YouTube's heavy acquisition came, domestic capital also boiled. According to incomplete statistics, a number of venture capital institutions such as Sequoia, Kaidian, and SIG have invariably entered the field of online video, with a total investment of more than 100 million US dollars.
That year, 16 online video companies in China received venture capital, and private video websites increased from the initial 30 to 40 to more than 300.
The influx of capital is naturally due to the potential of the domestic market – as of the end of last year, the data of China's netizens had approached 1 billion people, and in 2005 this figure had just exceeded 100 million.
Before 2006, the experience of online video was not good, it was still the size of tofu blocks, blurry, and the internet speed was slow, the cost of internet access was high, and it took a long time to load a 4MB movie trailer, and it was not a tv station opponent at all.
But as technological advances have reduced the cost of accessing the Internet, video sites have begun to exert efforts. In 2005, there were only 32 million users of online video in China; a year later, this number doubled to 64.39 million, accounting for 47% of Chinese internet users, and the total scale of China's online video revenue reached 500 million yuan.
In this way, driven by the combined efforts of broadband networks, technology iterations and capital investment, the network video market has entered a critical period of frenzy.
The development of Internet broadband access users and the proportion of high-speed users from 2006 to 2015
This period is also regarded as a "chaotic period" in the online video industry. Video websites that lack supervision and copyright awareness do not realize that it is the right thing to establish a content-centric profit path, and the website burns money for huge bandwidth costs but does not have the confidence to develop for a long time, which also lays the groundwork for the subsequent industry reshuffle period.
At that time, in addition to PPLive (the predecessor of PPTV, now PP video), PPS network TV (that is, the later PPS video) is through P2P, streaming media and other technical means, in the form of network TV to provide online live viewing services for network video, most of the video websites such as Cool 6, Six Rooms, Popcorn, etc. are similar to Youtube video sharing UGC mode.
Video sites with UGC content as the main attraction point only assumed the role of manager at that time, and almost all video content was uploaded by users themselves, and after review, they could be online for other users to watch. Tudou also mimics YouTube's slogan, "Broadcast Yourself," using "Everyone is the director of life" as the site's tagline.
Tudou founder Wang Wei
"Xidan Girl", "Rising Sun Masculinity", and "Coat Brother" Shandong farmer Zhu Zhiwen have all won wide attention through video sharing platforms such as Youku, Tudou, 56.com, and Ku6.com.
However, due to the high price of photographic equipment such as DV home cameras at that time, the video editing requirements for the computer's processing and computing power are very high, coupled with the requirements for the comprehensive quality of scripts, storyboards, performances, etc., most of the video types uploaded by users are various, the length of time is different, and the quality content is one of the best.
And only relying on a rare number of shooters, can not meet the user's online video consumption needs, so many people have become porters, the film, TV series and other film and television series privately uploaded to the video website. And because the network video at that time was still an emerging way of online entertainment, it was in urgent need of acceptance and recognition by users, and in order to attract users, video websites also adopted a blind eye attitude towards this behavior, although it was not advocated, but it would not take the initiative to delete unauthorized film and television content.
In the face of this emerging phenomenon, the regulatory level is also ambiguous. The Copyright Law of 2001 only stipulates the concept of the right of dissemination on information networks, and it was not until 2006 that the State Council promulgated the Regulations on the Protection of the Right of Dissemination on Information Networks, proposing the method of protection of the right of dissemination on information networks. However, the boundaries between genuine and pirated online videos are blurred, and there are many opinions on the form and division of online videos, and there is no clear and unified division standard. This also gives video sites room to grow savagely.
After the first few years of stocking, video sites have accumulated a large number of users, capital has become more and more favored, and a series of problems caused by relying on infringing piracy to attract users have also begun to be exposed.
As mentioned above, video site revenue was unstable and bandwidth costs were extremely high; and advertisers were more inclined to TV channels at that time, and there were too few users willing to pay, and there was no other way but to rely on venture capital for blood transfusions.
Liu Yan, the founder of six rooms who became popular with the spoof "Wuji", once revealed that when the most exaggerated time, it is necessary to pay $4 million in bandwidth costs a month.
In this way, the websites have raised funds like crazy, and the money they get has been burned to the operators, but they have never found a reliable business model. The video industry, which looks bustling on the outside, is actually full of lice. When the financial crisis hit in 2008, the online video industry naturally had to be washed away.
In order to seek long-term and healthy development, video websites have defected to the UGC camp.
In the same year, Tudou, a video website with UGC as an important content, decided to temporarily abandon this field, and Wang Wei, then CEO of Tudou, also threw out the theory that "garbage traffic is like industrial wastewater", because low-quality UGC content consumes a lot of bandwidth costs but cannot bring advertising revenue, and even cause copyright trouble.
In September 2009, the China Online Video Anti-Piracy Alliance, jointly initiated by Sohu Video, Agitation.com and Youpen pule, was established in Beijing. The sword refers to Youku, Xunlei and a number of websites suspected of piracy, claiming more than 100 million yuan; Youku immediately took countermeasures and sued Sohu on the grounds of infringing the right to reputation and copyright. Soon, other domestic video websites also carried the banner of rights protection and sued their peers.
The China Online Video Anti-Piracy Alliance was established in 2009
The industry is in turmoil, and the attitude towards regulation is gradually becoming clear. In 2008, the State Administration of Radio, Film and Television established a video website business license system, 247 institutions were awarded video licenses, and 57 video websites were punished and shut down, accelerating the compliance of the industry.
The surviving video websites urgently need to stabilize the method of increasing revenue, and secondly, in the face of legal proceedings and stricter supervision from upstream film and television parties, they must also change the previous barbaric growth model to avoid possible infringements and losses caused by litigation. Therefore, the route of increasing click-through rates and advertising revenue by virtue of the genuineness of film and television dramas has been selected by platforms.
In this context, the focus of competition for video websites has changed from bandwidth competition to copyright competition, which has led to the enhancement of copyright awareness and copyright cost.
"More monks and less porridge, coupled with the speculation of copyright parties, the copyright price around 2010 crazy premium." According to industry insiders, in 2011, a TV series that was still 100,000 to 150,000 yuan an episode could be hyped up to 1.8 million to 2 million yuan an episode a year later, "In 2006, the new media copyright price of the 80 episodes of "Wulin Waichuan" was only 100,000 yuan, and by 2014, the new media copyright price of 1.6 million / episode of "The Legend of Wu Meiniang" was already acceptable. ”
There are also platforms that grab the wind outlet and jump and take off. The scale of the domestic copyright market expanded, copyright costs continued to rise, but at that time, domestic video websites and film and television copyright owners did not have an effective cooperation mechanism, the platform signed authorization contracts with the rights holders one by one is too cumbersome, time-consuming and laborious, so it has bred a large number of copyright operation companies, and now has the largest domestic film and television library Copyright Operation Leader Huashi Wangju is a member.
The little-known LeTV was able to suddenly declare a profit in 2010 and became the first listed company in the field of online video, successfully raising 730 million yuan, which is also inseparable from the bet on copyright.
LeEco bets on copyright in advance
Li Ming, a former senior director of LeTV Cloud, once mentioned leTV's layout in copyright, "Before 2010, almost no video websites would spend a lot of money to purchase copyright, but Lao Jia took the lead in investing heavily in digital copyright, resulting in 59% of LeTV's revenue in 2011 being copyright distribution transaction income, not advertising." ”
But for video websites, this kind of large purchase of exclusive popular film and television drama network copyright, and then distribute the network copyright to other websites, from which to earn the difference in price model is only a stopgap measure to share costs and increase revenue, not a sustainable profit model.
LeTV has invested a lot of money to buy copyrights from upstream, making it difficult for many independent video websites, but also bringing great pressure to its own cash flow. By the end of 2011, about 80% of LeTV's 420 million yuan of super-raised funds had purchased copyrights, and the company's prepaid accounts also surged by 456.03% year-on-year, laying hidden worries for the subsequent thunderstorm.
In any case, this copyright war has given domestic Internet giants the opportunity to use capital to accelerate the reshuffle of the industry.
In 2011, Tencent Video merged with QQlive to officially launch; in 2012, Youku acquired Tudou for $1.04 billion in stock exchange; in May 2013, Baidu acquired PPS for $370 million and merged with iQIYI, helping iQIYI enter the first echelon of the video industry; in November 2015, Alibaba acquired Youku Tudou for $3.67 billion in cash.
At this point, under the fierce market competition and the merger and reorganization of giants, China's online video industry has ended the big wave and entered the era of BAT Three Kingdoms Killing, and Baidu iQiyi, Tencent Video, and Alibaba Youku have become the head of the industry. But the problems of the entire industry are still not solved, and how to find more profit breakthroughs is a top priority.
In the era led by BAT, video websites have a seemingly more stable business model, that is, charging advertising fees to the B-side, and then selling paid content and membership value-added services to the C-end, thereby continuously transfusing blood into the content investment.
Even so, in the orderly environment of online video copyright, it is still common for various platforms to spend thousands of dollars to purchase video copyrights, resulting in high platform content costs and delays in making profits.
Since 2016, iQiyi's content expenditure has exceeded 100 billion yuan; Tencent Video has not spared more, and last year, Sun Zhonghuai, vice president of Tencent and CEO of Penguin Pictures, said that the platform will invest nearly 100 billion yuan in content in the next three years.
Taking iQiyi as an example, its third quarter report this year shows that due to the simultaneous increase in content costs by 13% to 5.3 billion yuan, the cost of revenue increased to 7.028 billion yuan. The loss during the reporting period also expanded by 47.03% year-on-year, with a net loss of 1.707 billion yuan.
For the expansion of net loss, iQiyi CEO Gong Yu explained that it is because of changes in the internal and external environment. "The biggest problem facing long videos at present is the contradiction between supply and demand: under the influence of the epidemic, the number of movies launched is less than half of the same period in 2019, and the NUMBER of TV dramas is only about one-third of that of previous years; new online dramas have been delayed due to the epidemic and censorship reasons, and the quality has also been discounted, so the platform lacks high-quality content."
In addition to the old rivals fighting each other, the challenges encountered by video websites today are more from the upstarts of short and medium videos represented by "B Jitter".
In the field of mobile Internet, the competition for the length of time used by users in the video industry is a "zero-sum game". Since 2019, the volume of users of short video platforms represented by Douyin and Kuaishou has expanded rapidly, and long video platforms such as Aiyouteng have watched users who have been pulled with real money and silver to brush short videos to become addictive. According to QuestMobile, from 2019 to 2020, the average monthly use time of online video per user decreased from 14.19 hours to 13.81 hours, and the length of short video usage increased from 30.5 hours to 42.61 hours, which is nearly 3 times the length of long video users.
Short videos take up most of a user's time
The rapidly developing short video platforms have also extended their hands to the film and television copyright content that has invested heavily in long videos, which has touched the sensitive nerves of Aiyouteng. According to a publicist in the film and television industry, "short video drainage and long video monetization" is already a complete industrial chain, but now drainage has affected the monetization of long video platforms, because "everyone will not read the complete content after watching the drainage".
From April this year, "Aiyouteng" united 70 film and television production companies and 500 film and television workers to jointly denounce the short video platform film and television cutting, secondary creation of content infringement, to the June audiovisual industry association of the war of words, all in order to circle the content traffic, compete for a large number of users who are migrating from long videos to short videos.
The industry appeal was quickly responded to by the regulatory authorities. On April 25, Yu Cike, director of the Copyright Administration Bureau of the Central Propaganda Department, responded to the issue of short video infringement, "The National Copyright Administration will continue to intensify the crackdown on infringement in the field of short videos." The Copyright Law, which was revised for the third time last year, improved the relevant provisions on copyright protection in the Internet field and was officially implemented in June this year.
iQiyi is trying to launch high-quality dramas through "Mist Theater"
However, to solve the problem of infringement by short video platforms, the dilemma of long video user growth peaking and difficult to fill losses can be resolved? The deep reason for the long-term video profitability dilemma is the long-term market environment. China's film and television industry lacks a mature industrialized content production system, and the long video platform is still in the initial stage of exploration in terms of platform innovation capabilities such as IP development and self-made content, and it is difficult to form a positive and sustainable profit model.
More importantly, the free and even price war culture of the Chinese Internet makes users have limited willingness and ability to pay for long video content, as long as the demand still exists, the piracy industry will continue to "resurrect", and even have more forms of communication.
How to jump out of the vicious circle of copyright war and find more ways to monetize is the primary issue of Aiyouteng. Based on this, long video platforms not only need to work long video content creation, but also more actively embrace short videos.
Taking advantage of the wave of Internet antitrust, Tencent began to try to enter Douyin as a "regular army". On November 11, Douyin said that it received an application from Tencent's creation service platform and hoped to access the Douyin open platform. Tencent proposed, "Tencent's creation service platform has a large number of exclusive copyright works of popular films and televisions on the whole network that can be sent to Douyin to supplement the douyin content ecology." "But considering the long-standing open and secret struggle between Tencent and Byte, the open hinterland is still a long road."
Tencent also wants to get a piece of the pie in Douyin
In addition, judging from the development of long video for more than a decade, the growth anxiety of the platform will eventually still lead to content. Although short videos are more likely to refresh the freshness of users, from a continuous point of view, long videos, regardless of the amount of information or the degree of sophistication, should still be the focus of the platform.
Perhaps, video platforms can no longer usher in a soaring profit, but it is not necessarily a good thing to shift from "large investment" and "high risk" to "cost-effective" benign development.