The one who laughs last laughs the best. BAT finally came out to copy the bottom line of the smart TV industry

Words written in front:

Time flies, and 2016 has passed shamelessly. I miss it very much.

If the keyword of the smart TV industry in 2015 was "entry", then 2016 was "exit". Many new players who entered the smart TV industry with great fanfare in 2015 made their presence felt in front of the public, but after 2016, they put their weapons into storage and disappeared without a trace. The TV industry, which originally had a very high threshold, was crossed by a group of Internet barbarians with the added capital halo as if they were in an unmanned territory. In this industry that seems to be vibrant to outsiders, many people have drowned before they can find out how deep the water is. In fact, the giants with large chips are the ones who have the best chance to play to the end: the smart TV screen, like the previous PCs, mobile phones and tablets, has not been able to escape the traditional business routine dominated by BAT. Even more unfortunately, this routine seems to be maturing more and more rapidly in 2016. However, this does not mean that small players under heavy pressure have no chance of survival. LeTV, Xiaomi, Weijing and PPTV, Internet TV manufacturers with different development ideas, have also shown their magical powers and walked their own paths, gradually forming a unique symbiotic ecology with BAT...

If it weren't for the crazy pursuit of Internet manufacturers, the traditional players in the TV industry would never have dared to imagine that there would be a day when they would stand at the forefront of the storm; of course, objectively speaking, it is not entirely their own intention to stand at the forefront of the storm today, but a considerable part of the reason is due to the strong driving force from Internet capital.

Recall that in 2011, when the concept of "smart TV" had just emerged, store salespeople employed by home appliance giants had just learned how to use their eloquent tongues to sell users on the necessity of "TV Internet access." Of course, the ultimate effect was to make those confused potential salespeople mutter "Oh, this is really high-tech" while taking out their wallets. But who cared how many users actually connected the TV to the Internet after it was delivered to their homes?

Compared with those TV manufacturers who still follow the old routine and only use smart functions as strategic deception weapons in sales, it is the video websites that have nothing to do with the TV industry before that can truly explore the value of TV intelligence. Among them, the first to take action is of course the familiar LeTV, which has woven a large network of home large-screen interactive entertainment ecosystem covering the entire screen, entire product line and all content.

Today, when PCs, tablets and smartphones have been monopolized by BAT in terms of traffic and monetization methods, the TV screen is just like the order-deficient American West 200 years ago, where there is still an opportunity to "grab land" and complete primitive accumulation. This provides the grassroots heroes who are dissatisfied with the status quo with the possibility of "getting rich overnight", so we see the jaw-dropping sales figures given by LeTV.

However, the loudest voice in the smart TV industry in 2016 came from BAT, which was once considered to be "lagging behind" in this industry. Whether it was mergers and acquisitions or investments, one after another, big moves announced that giants with more powerful funds are re-entering the market - yes, this is very BAT: the giants with large families and businesses will give up a certain market share in the early stages of industry development to some brave people to try and error first and educate the market so as to sort out a mature business model, and then quickly enter at the appropriate time to grab the fruits of victory. "Letting water flow to raise fish" actually means this. This little water is not valuable. What is valuable is the fish. As for who raises these fish... haha.

[Ali Digital Entertainment: Acquisition of Youku to solve content problems and rely on YunOS to promote the ecosystem]

After forbearance for three years, BAT began to concentrate its efforts in the second half of 2015 to prepare for overtaking. The first to move up was of course Alibaba. After the rumor that Youku Tudou was seeking a buyer had been circulating for more than half a year, Alibaba successfully became a shareholder at a price of more than 4.5 billion US dollars, and transformed Youku from an independent company to the main department of its own Alibaba Digital Entertainment Group. This move also officially marked that BAT can continue to play Landlord happily in the field of living room entertainment as in other battlefields. Objectively speaking, before the acquisition of Youku, Alibaba had the operating basis of the Internet TV broadcast control license by virtue of its investment in Hangzhou Wasu, and Alibaba Pictures solved the copyright problem of the top content in the film field, but it was somewhat unable to rely solely on Wasu's copyright reserves for TV series, variety shows and children's content that the people loved to watch. The addition of Youku content made up for this shortcoming in the OTT field for Alibaba and enriched the self-content that the Internet crowd paid attention to.

Content and channels have always been a two-pronged approach. After solving the content problem through purchases, the channel also needs to use the big killer of money policy. So YunOS, with high subsidies and a full set of Alibaba ecosystem, crossed the Jialing River and rushed to Shenzhen, almost catching all the Chinese copycat box manufacturers in one fell swoop, so that for a period of time, there were almost only two software platforms in the set-top box market: Alibaba's YunOS and Xiaomi's MIUI. The subsidy strategy quickly expanded the number of Alibaba's living room entertainment platforms, but the relatively strong cooperation strategy also caused dissatisfaction among some partners. After all, except for the pre-installed application position, the manufacturers cooperating with YunOS (mainly set-top box manufacturers) no longer have the opportunity to obtain revenue from subsequent operations, which is obviously not what the manufacturers expect to see.

[Baidu/iQiyi: Join hands with CNR to solve license issues and deepen the development of Internet brand smart TV]

Baidu's recent development momentum in the Internet industry is not very good, but iQiyi, as its own son, is thriving with its accumulation of content. Unlike Youku, which is close to the people, iQiyi has been targeting young people who have already fully embraced the Internet, a group with strong consumption power, since its very beginning. The content organization is also centered around this group. Kim Soo-hyun, Song Joong-ki, Wang Kai, Li Yifeng, Zhang Yixing and many other idols who are deeply loved by young (young) (young) user groups frequently appear in the film and television works purchased or produced by iQiyi, so every day you will see various husbands taking turns to dominate the screen...

Since it is essentially about the Internet user group, the cooperation strategy with TV manufacturers is basically clear to provide a Turn Key Solution for the content platform of Internet brands' smart TVs, from licenses to content. In fact, the threshold that Internet manufacturers need to face in making smart TVs is higher than that of traditional manufacturers. In addition to supply chain issues, communication with license holders is also a complicated process. iQiyi and China National Radio New Media, which has an Internet TV broadcast control license, jointly established Galaxy Internet TV, integrating content with license holders and then conducting external cooperation. Xiaomi mentioned in the previous article, as well as Baofeng and Damai, TV/set-top box brands originating from the Internet, all mainly use the complete set of services of Galaxy Internet TV.

【Tencent Video: Comprehensive content construction and open ecosystem】

The situation of Tencent Video is quite interesting. Compared with its rapid development in PC and mobile terminals, Tencent Video's actions in the OTT field can be said to be "sometimes fast, sometimes slow". As early as 2011, Tencent invested in Future TV, successfully solving the most important license issue for Tencent Video to provide Internet TV services. However, it should be said that the large-scale efforts were made in 2015. 2016 can be said to be the first year when the OTT industry really began to develop. The comprehensive layout in the past two years can be regarded as Tencent's "best time".

Of course, being a large company has an advantage, that is, it has enough strength to quickly mobilize a large amount of resources in a short period of time without trial and error, and directly enters into a positional war. In 2015, Tencent Video's almost complete coverage of copyrighted content is a very strong proof. Although it was said earlier that Tencent Video's development in the OTT field was "sometimes fast and sometimes slow", in 2016, when the users of the entire industry began to accumulate a certain amount, and the payment habits had been basically formed, and the advertising ecology had become increasingly perfect, Tencent Video, with its keen sense of smell in the OTT field, began to spend a lot of money to purchase copyrights and cultivate content production capabilities at the same time, displaying its skills in the content end and completing a straight-line overtaking. At the Tencent Video V Vision Conference held some time ago, Tencent's leaders announced that the strategy for video in 2017 was to vigorously promote the production of high-quality Internet content on the basis of full coverage of high-quality copyrights, and the proportion of self-made content would be 8 times that of 2016.

If Alibaba (Youku)'s content is more popular, and Baidu (iQiyi)'s content is more Internet-oriented, and their strategies are to first gain an advantage in a certain vertical field and then expand to the surrounding areas, then Tencent Video obviously has a bigger appetite in content organization, and it attacks from all sides in the hope of covering as many user groups as possible. In addition to popular content such as TV series and variety shows that can increase user stickiness for a long time, movies, self-made and sports content are the core means for Tencent to conduct differentiated competition: the Hollywood zone brings together major North American film giants including Warner Bros., Universal, Paramount and 21st Century Fox, thus completing the connection with theater resources, and self-made dramas and variety shows have become important bargaining chips in the competition with iQiyi. In addition, what Tencent really hopes to widen the gap with other companies is the investment in sports content: in addition to signing the NBA's 5-year exclusive broadcasting rights, it has purchased the copyright of the European Champions League in football, and this year cooperated with Future TV on OTT to introduce the European Cup and the Olympic Games, etc., which has basically covered the mainstream sports content needs.

Solving the content problem is only the first step. What is more important is how to acquire a large number of users in a short period of time to promote the content. In this regard, Tencent has chosen the strategy of pre-installation and app store download. The formulation of this strategy also absorbs and draws on the experience and lessons of Alibaba and iQiyi in market promotion (in fact, it is mainly lessons^_^), and finally chose these two more rational and mature strategies:

First, it emphasizes "openness" rather than predatory cooperation. Previously, when Alibaba's YunOS was promoted, it gave its partners the impression that it was too strong because it wanted to fully control the entire ecosystem on the device side. However, when cooperating with Tencent, it only required the pre-installation of Tencent Video TV content, and did not ask for other important commercial monetization opportunities such as application stores and pre-installation, which is conducive to reaching cooperation with partners more quickly.

Second, it affirms the value of traditional TV manufacturers and kills two birds with one stone. If Alibaba's focus on the set-top box market can be seen as a desire for "speed" and iQiyi's focus on Internet brand TVs is because it wants to be "specialized", then Tencent's purpose of cooperating with traditional TV manufacturers is to "cover all". Tencent targeted traditional manufacturers right from the start because it meets the demands of both parties: traditional manufacturers need rich content from the Internet to improve their competitive advantage, while Internet companies such as Tencent can quickly expand their user base by relying on the sales channel advantages of traditional TV manufacturers on the premise of sufficient market education.

Mature solutions bring significant results. According to data provided by Aowei Cloud Network, Tencent Video TV (Penguin TV) has been pre-installed in more than 50% of the shipments of the top 6 TV manufacturers in 2016 (and 5 of the top 6 are traditional TV manufacturers). This result is the return of accurate timing, correct ideas and sufficient resource investment. On the other hand, after so many years of development, the smart TV industry has finally become a game of landlords among the three traditional giants of BAT. Of course, although these BATs are the ones who laugh the most, this does not mean that some other Internet manufacturers have no room to survive around the giant ecosystem of BAT: In addition to LeTV, Xiaomi, Weijing and PPTV are all forces that cannot be underestimated in the smart TV industry. In subsequent articles, there will be more summary and analysis articles on the performance of these manufacturers and products in 2016.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.