Following the announcement of the gold VIP membership fee increase in November last year, iQiyi announced another increase in the membership fee after a year.
According to iQIYI VIP member official Micro, from 00:00 on December 16 this year, the iQIYI Gold VIP subscription price will be updated. Among them, the price of the gold VIP member annual card remains unchanged, the continuous monthly card rises from 19 yuan to 22 yuan, the price of the continuous package season card rises from 58 yuan to 63 yuan, the non-continuous monthly card rises from 25 yuan to 30 yuan, and the non-continuous package seasonal card price rises from 68 yuan to 78 yuan. Among them, the largest increase was a non-consecutive monthly card, with an increase of 20%.
iQIYI responded: "The subscription price of video platforms has always been low, and this phenomenon has affected the healthy development of the industry. In order to establish a more benign industrial ecology, let excellent content producers have a return, and ultimately provide members with more and better content, we decided to adjust the price of members. ”
As for whether the long-term video industry will raise prices for many years like Netflix's practice in the future, Yang Xianghua, a member of iQiyi and president of the overseas business group, said in an interview with the first financial reporter that it was still inconclusive, "It depends on the quantity and quality of the content we provide, consumer satisfaction with us and consumer acceptance of the price of our services, and comprehensive research to decide." ”
Since the beginning of this year, iQiyi is not the only video website that has announced price increases. From 00:00 on April 10 this year, Tencent Video made unified adjustments to the price of VIP members. After the upgrade, the price of Tencent Video membership is 15 yuan for consecutive monthly subscriptions, 45 yuan for the package season, 178 yuan for the annual package, 20 yuan for non-consecutive monthly cards, 58 yuan for the season card, and 198 yuan for the annual card.
Behind the price increase, membership income has always been the most important source of income for long video websites, followed by advertising. At the same time, Chinese video banks face the harsh reality of being in the red since their inception. As a long video field so far, Youaiteng has fought the copyright war, experienced the transformation to the mobile Internet, and then explored the video membership payment model, and then to some choose losses to list and some delist, and constantly produce "broken circle" network dramas and network synthesis, but until now the industry is still generally in a state of loss.
Especially under the high content investment, revenue is still difficult to cover the cost, and the overall competition in the video field continues to glue, relying on the B station of the second dimension and the subcultural circle layer to accelerate out of the circle, and more and more users spend fragmented time on the rapidly rising short video platforms such as Douyin and Kuaishou.
Under pressure, not long ago, iQiyi employees revealed to First Finance that they are currently laying off employees. Judging from the performance of US stocks, iQiyi's stock price has reached a maximum of $28.97 in the past year, and it is only $4.69 at present.
In fact, the market composition of the online audiovisual industry has changed. According to the "2021 China Online Audiovisual Development Research Report", the proportion of "short video" in the market composition ranked first, with a market size of 205.13 billion, an increase of 57.5% year-on-year; in contrast, the "comprehensive video" represented by "Aiyouteng" ranked second, with a market size of 119.03 billion, an increase of 16.3% year-on-year.
If you look at the situation of youaiteng three, although youku did not disclose specific data after being acquired by Ali, Ali's financial report shows that in fiscal 2021, Ali's big cultural and entertainment operating loss was 10.321 billion yuan, and the adjusted EBITA was a loss of 6.118 billion yuan; Tencent's third quarter financial report this year did not separately disclose the loss of Tencent Video, but said that "Sweeping The Storm" and "You Are My Glory" only brought 4 million new members to Tencent Video.
iQiyi's latest third-quarter financial report showed that total revenue reached 7.6 billion yuan (about $1.2 billion), an increase of 6% year-on-year; but the net profit attributable to the mother was a loss of 1.7 billion yuan, compared with a loss of 1.2 billion yuan in the same period last year, an increase of 41.6% year-on-year. Among them, the company's "content cost" expense, which accounts for most of the cost of revenue, amounted to 5.3 billion yuan (about $824.5 million).
In the third quarter of 2021, iQIYI's cash flow from operating activities was -2.081 billion yuan, once again expanding from the same period last year.
At the same time, as of the end of the third quarter, iQIYI's subscription membership reached 103.6 million, down from 104.8 million in the same period last year, but membership service revenue increased by 8% year-on-year.
The above data also means that after the first wave of price increases last year, users have "voted with their feet": iQiyi's membership has decreased, but because of the increase in membership fees, the business's revenue has generally increased. After rising prices again this year, iQiyi may face a similar situation.
Behind the price increase, some insiders pointed out that the continuous production of high-quality content is the core competitiveness of the video industry. It can be contrasted that Netflix's previous ability to continuously increase prices is to successfully create high-quality content through huge investments to attract paying users, and then use the paid revenue to continue to invest in high-quality content, and then feed back users and the industry.
In fact, in addition to responding to the impact of short videos, the long video industry itself also has problems to be solved, including "content injection" and "traffic theory". For example, the question of the slow pace of online dramas, the procrastination of plots, and too many water injection plays persists, and some users have become accustomed to watching dramas at double speed and no longer pay for water injection works, which have sounded the alarm for the long video industry.
Not long ago, iQIYI CEO Gong Yu also mentioned that the biggest problem encountered in the long video industry is a serious shortage of content supply from the perspective of supply and demand, including the impact of the epidemic on progress, the proportion of traditional TV dramas has become smaller or even almost only one-third of previous years, new online dramas have been delayed due to review reasons, and the quality of online dramas has been discounted... There is a relatively large problem in the supply of content; the objective reason is the competition for the user's time of short videos.
It can be seen that the long video industry is experiencing a transition from merchant payment to user payment, and users gradually grasp the right to directly judge the quality of content.
A long video practitioner told the first financial reporter that from the perspective of business model, in the past, the long video industry was dominated by the advertising model, more to see whether advertisers bought or not; but now under the membership system dominated by revenue, content creators are more directly oriented to consumers and meet the needs of consumers, "whether the audience has the final say", the reason why these business models are changed, the core is to make the entire market large, in the case that consumers can accept, so that all participants in the industry chain can benefit.
However, for the video industry that is still losing money, the price increase is only one part of the solution to the problem of content costs. When the demographic dividend gradually disappears, Internet advertising and traffic growth slows down, and the impact of short videos, the film and television industry that promotes membership growth is facing challenges due to the impact of the epidemic, where is the imagination space for video websites that are still in the loss? It is a place that needs to be constantly explored by the long video industry.