Author| Liu Yuting
Editor| Chen Yanxu
Operation| Chen Xiaoyan
Mirror (ID: DMS-012)
After restricting the clarity of screen casting, iQiyi has once again appeared on the hot search.
On January 16, some netizens reported that iQiyi had restricted the broadcast of the TV terminal in all aspects. In addition to restricting the clarity of mobile phone screen casting, iQIYI limited the HDMI cable connection TV playback function, when using the iPad to connect the HDMI cable to the TV, click on the TV series to play but be prompted by a pop-up window "Due to copyright reasons, this content does not support HDMI connection playback".
iQIYI immediately responded that the restriction of HDMI connection playback function is a restrictive measure taken at the request of copyright owners based on digital copyright protection agreements to prevent screen recording piracy. This feature has been online for many years, which is also common practice in the industry. Other content that is not restricted by the digital rights protection agreement can still be played over an HDMI connection. This restriction is independent of whether or not you are subscribed to a membership.
Previously, iQiyi App's move to restrict the clarity of screen projection attracted attention from the outside world. In the past, iQIYI Gold VIP members supported 4K definition screen projection on the computer, but now they can only choose 480P definition. If viewers want to see high-definition videos on their computers, they need to open a higher-level membership to get high-definition screen projection or TV viewing rights.
In the eyes of the outside world, this is another move by iQiyi to encourage users to recharge high-level members and seek profits, reflecting the dilemma of the entire industry: users peaking, members leaving, slowing growth, and long-form video platforms are difficult to make profits.
Under the cold economic winter, long-form video platforms have chosen to open source and reduce costs. On the one hand, the long-form video platform frequently focuses on members' open source measures, and promotes members' consumption with measures such as advanced on-demand, VIP price increases, restrictions on screen casting, and account sharing; On the other hand, the platform has reduced the output of content such as drama variety shows, and the rise of micro-short dramas with low cost and quick results has become the biggest change in the film and television drama market in 2022.
Platform anxiety, open source tricks
Distinct Mirror
In 2022, long-form video platform members will increase prices one after another. In December last year, iQIYI just announced an increase in the subscription price of iQIYI Gold VIP membership and Star Diamond VIP membership, which is its third price adjustment in the past three years, and the monthly price of gold VIP has risen from the initial 15 yuan / month to 25 yuan / month.
However, the price increase seems to have been unable to meet the needs of iQiyi, and began to try to "force" users to recharge higher-level members by restricting screen casting.
It is reported that iQiyi has three VIP levels: Gold VIP, Platinum VIP and Star Diamond VIP Member. Among them, the new users of gold VIP have an annual subscription of 118 yuan, which can be used on computers, mobile phones, and pads; Platinum VIP new users continue to subscribe 198 yuan per year, increasing the viewing rights of the TV terminal; New users of Star Diamond VIP have an annual subscription of 318 yuan, and support 7 kinds of terminal viewing rights such as mobile phones, TVs, computers, Pads, and VR.
Under the same video platform, it is divided into mobile phone members and TV members, which are not compatible with each other. If you want to watch higher definition or copyrighted movies and series on your computer, you should also add a higher price Platinum or Star Diamond tier membership.
"Screen projection is a normal use scenario for mobile users, consumers have paid for it, and it is the consumer's right to watch it on the mobile phone or cast the screen." Video platforms also have no right to improperly obtain mobile phone permissions, interfere with consumers, and use third-party apps or connections to cast screens. The practice of matryoshka filling the wool of the consumer is not acceptable. In response to iQiyi's move to restrict the clarity of screen projection, the Shanghai Municipal Consumer Protection Commission issued a criticism.
In fact, iQiyi is not the first long-form video platform to limit the screen projection function. Station B users need to install the corresponding TV version of the application to watch screen projection and video barrage with a resolution of 1080p or more. In July 2022, Youku began to prohibit some popular movies from being cast to TV, even if there are mobile Youku members, screen projection is prohibited, and 300+ yuan TV version of Kumeow membership must be opened.
Youku is no less anxious about membership subscriptions than iQiyi. In December last year, Youku revised the user agreement, which stipulates that in the future, a Youku member can only log in to one mobile phone device, and before that, it can log in to three mobile phone devices, which means that a family of three chasing dramas also needs to open multiple members to easily watch on the mobile phone.
Youku said that such a regulation was made "to protect the security of user accounts, crack down on black and gray production, and take into account the usage habits of the vast majority of users."
Youku's approach may also be an effective imitation of the "predecessor" Netflix, which last year began restricting users to use multiple accounts per account. Previously, Netflix could add multiple sub-accounts to a member account for multiple people to use, which was also regarded as a major move to expand its user scale, but now Netflix has begun to require one person and one number in many countries and regions to pursue actual membership subscription profits.
Member price increases, screen casting restrictions, account restrictions, many measures made by streaming media platforms around members reflect the dilemma of the entire industry: the loss of user members, the slowdown in revenue growth, and the difficulty of making profits on long-form video platforms.
Membership stock competition
Distinct Mirror
Before announcing the restriction on screen casting, iQiyi had just received $500 million in financing, which eased its cash flow pressure, but it could not fundamentally solve the growth dilemma faced by iQiyi.
Since the fourth quarter of 2021, iQiyi has seen a number of quarters of revenue regression. On November 22 last year, iQiyi released its third-quarter financial report, with quarterly revenue of 7.5 billion yuan, down 2% year-on-year, and adjusted net profit of 187 million yuan.
Although iQIYI raised its membership price in December 2021 in an attempt to boost membership revenue, its revenue decline has not reversed. At the same time, the membership growth of long-form video platforms has peaked, and "Aiyuteng" has fallen into the competition for user stock.
As of September 30, iQIYI had 106 million members. Benefiting from the popularity of the popular "Canglan Tips", iQiyi has achieved a great breakthrough compared with the 98.3 million members in the second quarter of this year. However, before the fourth quarter of 2021, iQIYI had 10 consecutive quarters with more than 100 million members, and in the longer term, the number of iQIYI members is still in the recovery period.
The core factor of member loss is that user loyalty is difficult to guarantee, and it is the drama variety show products on the video platform that attract users, not the platform itself. When blockbusters are missing, members are likely to lose or be attracted to competitors.
Even Netflix, where content is king, faces the same problem. In January 2022, Netflix announced an increase in the price of its membership service in the United States and Canada, which was much higher than that of competitors Disney+, HBO Max and Amazon Prime Video in the region, and then it lost subscribers for two consecutive quarters, and it was not until the third quarter of last year that Netflix subscribers returned to growth.
In order to increase revenue while ensuring the number of subscribers, Netflix, which has always refused advertising, has also had to bow its head and launch a low-cost membership package with ads, which is expected to bring huge advertising revenue to Netflix in addition to potential subscription members; Rival Disney+ also announced an affiliate model in December, with plans to launch globally in 2023.
Unlike Netflix, domestic streaming platforms have chosen the "subscription + advertising" profit model from the beginning. Before users cultivated membership awareness, iQIYI's advertising revenue accounted for more than 60% of the total revenue. With the rapid growth of the number of members from 2016 to 2019, membership business replaced advertising as the most important revenue pillar, and by the first half of this year, advertising revenue accounted for only 20% of revenue, and membership business accounted for 60%.
In the first half of this year, the platform's advertising investment was cold, and under the cold economic winter, the number of brand sponsorships of the N generation decreased sharply compared with the previous quarter, and even the popular variety show 0 brand sponsored broadcast. During the same period, iQIYI's advertising revenue fell by 32% year-on-year.
When advertising is unfavorable, the membership business carries more pressure. Member price increases, account restrictions, and screen casting restrictions are all repeated uses of the current membership stock. With the user ceiling approaching, membership growth peaking, and long-form video platforms are realizing that they can only increase the value of a single user.
Is the skit the hope of the audience?
Distinct Mirror
After iQiyi's topic of restricting screen projection rushed to the hot search, some netizens commented on social media: "The source of the price increase on the platform is the cost, only know that consumers have to pay, why not reduce the actor's salary?"
The core problem that makes long-form video platforms anxious is that stagnant revenue is difficult to cover huge costs, and high content costs have always been a problem for video platforms. In addition to self-made exclusive dramas, in order to ensure competitiveness, domestic video platforms also have a large number of dramas, movie variety shows, etc. purchased from third-party film and television companies, and the rising cost of copyright content makes it more difficult to make profits.
Among them, the high salary of actors is considered by the outside world to be a major reason for the high production cost of dramas. After the salary limit order landed, iQiyi CEO Gong Yu talked about actor remuneration in the first quarter of 2020 earnings call, saying that the current actor's salary has dropped to less than 50 million yuan for a drama, and the dramas broadcast now are in line with the limited price, and the previous first-line actor's salary is as high as more than 150 million.
In the face of huge content costs, long-form video platforms that reduce costs and increase efficiency are more cautious in the selection of episodes. According to public statistics, in 2022, a total of 227 new solo dramas will be launched on online video platforms as a whole, a decrease of 13 from the same period last year; In 2022, the total number of new dramas will be 419, a decrease of 95 compared with last year.
According to the State Administration of Radio, Film and Television, a total of 545 online dramas were filed in the first 8 months of 2022, a decrease of 294 from 839 in the same period of the previous year, a year-on-year decrease of 35%.
As long-form video platforms throttle and reduce content spending, the number of S-grade dramas on platforms has plummeted, replaced by low-cost mini-dramas.
The rise of micro-dramas has become the biggest change in the film and television drama market in 2022. It is reported that in the first half of 2022, the State Administration of Radio, Film and Television systematically planned and filed 2,859 micro-short dramas, while in 2021, the number of micro-short dramas filed for the whole year was only 398. Within a year, the number of micro-drama filings increased nearly tenfold. In the third quarter of this year, the number of new short dramas on Youku doubled from the previous quarter to 75, and Tencent Video increased to 35.
Compared with online dramas and TV copyright dramas, micro-short drama actors have low salaries and short production cycles, which can solve the dilemma of high content costs to a certain extent. Industry insiders revealed that most of the micro-drama actors are not popular, so the salary is low. The production cost of micro-short dramas can be controlled within 500,000 yuan at least, and the production cost of landscaping may exceed 2 million yuan.
At the same time, the plot content of micro-short dramas can enrich the platform ecology, have a new effect, improve user stickiness, and phenomenal micro-short dramas can also effectively promote member subscription.
In 2022, the cumulative number of views of Mango TV's short drama "False Face" exceeded 600 million, and Tencent Video "Please! Don't Pet Me" was launched for three seasons, with a cumulative amount of 32.49 million yuan, in addition, the box office of Youku short dramas "Deadly Housewives" and "Thousand Golden Girls" also exceeded 10 million.
Under the cold winter of film and television, the short drama market with low production cost and fast capital return has been rapidly ripened, micro-short dramas continue to rise, and long video platforms are gradually breaking the advantages of short video platforms in the short drama market.
The prosperity of the short drama market means increased competition for film and television production companies; But for long-form video platforms that lack the funds to create content and need to attract users, it may mean new hope.