Video and audio streaming services are important platforms that studios, record labels, independent creatives and influencers use to reach as many viewers and listeners as possible. They also serve social networking features to keep you and your friends in the loop. Naturally, China has its own ecosystem of streaming services and we will guide you through the major players and how several survived fierce competition and innovated their way to global domination, surpassing their Western counterparts.
VIDEO STREAMING SERVICES
Chinese video streaming platforms offer options for both live and prerecorded content. These services are mostly owned by China’s internet giants and follow subscription and/or monetization models.
Launched in 2006, Youku began as a video hosting website with a focus on user-generated content (which later shifted to a focus on licensed professional videos). Youku then merged with Tudou in 2012 to form China’s largest video hosting platform with 30% of market share. Youku Tudou now operates as a subsidiary of Alibaba, which had acquired the service in 2015.
The service hosts 580 million users, 150 million daily active users, 1.18 billion daily video views and 400 million mobile daily video views. Youku is already known as Chinese YouTube but has lagged behind rivals Tencent and Youku more recently. Alibaba has been investing heavily in original content in line with Netflix’s high-content-spend growth strategy amidst fierce competition.
Youku offers an online viewing analytics tool, providing user information and enabling brands to identify their audience based on demographics, location, browsing technology and language. Youku relies heavily on ads including banners, both static and animated, text links, buttons, in-stream advertisements, branded viral videos, and pause ads.
iQiyi was founded in 2010 by Baidu, China’s largest online search engine, and Providence Equity Partners. Baidu later acquired PEP’s stake in iQiyi in 2012. iQiyi then merged with PPS.tv (PPStream) when Baidu acquired PPS, another leading online video provider, in 2013.
iQiyi’s platform boasts an array of original content, other professionally-produced content, partner-generated content and user-generated content. In 2014, iQiyi Motion Pictures was launched as the site’s division for film production. Its subsequent partnerships with the Venice Film Festival and Busan Film Festival, and a recent licensing deal for Netflix originals, cements iQiyi’s status on the international motion picture stage. The service follows a monetization
model that includes membership services, online advertising services, content distribution, live broadcasting, online games, IP licensing, online literature and e-commerce etc.
iQiyi recently recorded 100 million paid subscribers with 454.5 million mobile monthly active users and 135.4 million mobile daily active users. The video streaming site was the first in China to file for an IPO in the US, naturally winning the title of ‘China’s Netflix’. Its CEO, however, has likened iQiyi ecosystem to an ‘online Disney’.
LIVE STREAMING SERVICES
Live streams are popular in China. There is something special about being able to follow the activities of your friends and other influencers in real time, imagining yourself there with them and never missing out on the latest buzz. Live stream is a popular tool for video gamers as well, allowing their fans to immerse themselves in the action in real time. Streaming platforms have also revolutionised the e-commerce and education industries.
Here is an article with extensive insight and commentary about five major entertainment live-streaming apps: Momo, Huajiao, YY, Yizhibo, and Inke.
Briefly, Momo is marketed as a social networking and dating platform; Huajiao offers contests, shows and a larger revenue share than other services; YY is one of the original services so although not as trendy as the newer services, it is still nice to reminder that it paved the way for China’s streaming boom; Yizhibo’s partnership with Weibo for content creation and circulation naturally makes it a top choice for celebrities and brands to reach Millennials; and finally, though generic, Inke’s IPO in 2018 suggests that it is still a force to be reckoned with.
Douyu and Huya
Douyu become the largest Chinese IPO in the US in 2019 after raising US$775 million. Modelled on Twitch, the Tencent-backed company has now surpassed the monthly active users of its Western counterpart, with 160 million MAUs. With a literal translation of “fighting fish”, the streamer boasts 6 million registered streamers with over 5,200 having signed exclusive contracts. It’s closest rival is Huya, which although having beaten Douyu to an IPO in May 2018, remains behind in terms of funding and MAUs. This article neatly explains the history of China’s ‘Thousand Live Stream War’ and how Douyu and Huya managed to survive the war along with a third rival, Panda TV, that has since been cancelled by a cash crunch. But the feud continued as matters reached court. Of interest is that Tencent is one of the biggest investors in both companies, owning 40% of Douyu and 31.5% of Huya.
AUDIO STREAMING SERVICES
Along the likes of Amazon, named after the great South American river, and Alibaba, a character in a Middle Eastern folk tale, came the aptly named Ximalaya FM, a nod to the great Asian mountain range and home to the highest peak in the world. The service hosts around 500 million users, offering podcasters a platform to share their know-how and establish a following. CEO Yu Jianjun has ambitions plans to expand Ximalaya into an online audio ecosystem in the way that the Himalayas are composed of mountains that stretch across five countries.
As one of the major music video streamers in China, YinYueTai is the Chinese counterpart to the American Billboard and the South Korean Gaon Chart. Perhaps its most welcomed feature in this era of information overload is that the platform bypasses advertising and only provides one copy of each music video to streamline its interface and experience, allowing the user to immerse fully in the art of music videos.
Tencent Music Entertainment Group (TME) – QQ Music, Kugou, Kuwo
Just like its domination in the live streaming arena, TME now operates three major music streaming services in China, controlling over 75% of the market, after its merger with China Music Corporation in 2016. Their mission is to elevate the role of music in people’s lives by enabling them to create, enjoy, share and socialize through innovative technologies around online music, karaoke and live streams. TME hosts over 800 million monthly active users, owns rights to over 20 million songs and has agreements with over 200 music labels including Sony, Universal and Warner across its three services—QQ Music, KuGou and KuWo. Each follow a freemium model where basic services are free while a subscription will allow access to premium features or certain albums. And if three streaming services weren’t enough, Tencent also owns WeSing, a social-based karaoke app that rides on the popularity of KTV—karaoke television—in China.
Born out of a joint venture between Tencent and Spotify, QQ Music made the headlines in 2016 for turning over a profit unlike many global providers including Spotify. Its success comes from its exclusive distribution deals with Sony, Warner and South Korea’s YG Entertainment, guaranteeing it a steam of loyal listeners. And being part of the same family as the WeChat and QQ social networks allowed it to infiltrate an existing ecommerce system and user base.
The rise of KuGou—whose name translates to ‘cool dog’—to become the world’s largest streaming service rests in its cunning decision to target the towns and small-cities of China where local Chinese songs are favored over Western imports by its yet-to-be Westernized communities. A feature that allows users to record themselves singing over popular tracks appeals to the KTV lovers, whose entertainment options are limited in small cities. Among the niche audiences that the service targets are the Cantonese opera loyalists in Guangdong province and the middle-aged female square-dancers scattered across the country.
NetEase Music (music.163.com)
The Baidu backed music platform was founded in 2013 and remains a competitor amidst Tencent’s empire, with over 600 million registered users. The NetEase community is perhaps it’s most admirable feature, with users leaving comments, posting jokes and heartbroken stories in ways that attract likes from fellow members of the community. This social characteristic was cemented by the service when it published the most-liked comments in metro stations and trains in Hangzhou. For an analytical study of NetEase’s data, Martin Liu has written a great piece: https://towardsdatascience.com/analyzing-netease-music-part-i-playlist-968f43fc7fc5