Who will be the leader in the video website industry in the next five years?

On the evening of April 21, after the conclusion of iQiyi’s fifth anniversary party, I planned to use iQiyi as a starting point to once again sort out my analysis of the future trends in the video website industry.

Prior to this, Gong Yu, CEO of iQiyi, also expressed his own views. He believed that "it is difficult for the video website industry to form an oligopoly in the short term. In the next three to five years, the video website industry will continue to see mergers and acquisitions and bankruptcies. The two or three companies that survive in the competition will eventually compete for the 40 billion video market, and form a differentiated trend in original content and platforms in the constant competition."

Obviously, iQiyi classified itself into the remaining "two or three companies".

Officially launched in April 2014, iQiyi is backed by Baidu, the leader of the BAT internet giants. It survived the online video copyright war that broke out in 2011 and has long been at the forefront of the video website industry with its young age and large size.

In fact, iQiyi, which encountered a copyright dispute just after entering the market, can be said to have turned a disaster into a blessing. First, its short history has determined that it has not been tainted with the genes of pirated resources; second, it has won a certain amount of content resources and user market in the copyright dispute. Especially with the support of Baidu's funds and resources, iQiyi has completed the continuous integration and mergers and acquisitions in the video website industry.

With the entire video website industry still in a "burning money" mode, Baidu chose to invest US$370 million to acquire the PPS video business and merge it with iQiyi. Obviously, it is not just to take advantage of the complementarity of users and resources of both parties to expand the overall scale of iQiyi's platform, users and time in the industry, but to further strengthen iQiyi's leading role and integration power in the video website industry.

Especially after Youku and Tudou, two US-listed video websites, had a "flash marriage" and merged their 100% equity in 2012, the trend of mergers and acquisitions in the video website industry has become increasingly clear. If no action is taken, the goal of competing for "China's largest online video platform" will only become more distant.

So far, the video website industry has Tudou, which has merged with Youku, PPS, which has been acquired by iQiyi, and 56.com, which has been acquired by Sohu Video. As the five giants in the current video website industry, only LeTV and Tencent Video have not taken the step of merger and integration. Obviously, this does not conform to the statement of industry insiders that "before the emergence of industry oligarchs, investment, mergers and acquisitions and bankruptcies in the video website industry will continue."

It remains to be seen whether iQiyi, Youku and Sohu Video can escape the fate of being integrated after the completion of the integration.

Behind this spending and integration, there is actually consideration and screening of the content resources of video website companies.

If the copyright dispute is the first round of survival test for the video website market, then the creation of original content is another development stage to change this survival logic. After all, in the copyright competition, no video website company has the real strength to monopolize the entire copyright content market, and professional operation with self-made and original content as the direct form of expression is the important outlet for the long tail effect.

More importantly, as capital's demand for profitability increases and the market matures, the video website industry can no longer simply burn money. The direct input-output ratio of copyrighted content has clearly stimulated the future development of video website companies.

The understanding of original and self-made content can ultimately be attributed to copyright and content differentiation.

Regarding the investment in original content, Gong Yu said, "A broadcasting platform must have its own characteristics and be clearly differentiated from other platforms; and the best and almost only way to achieve this differentiation is through self-made content. Self-made content has many types, including dramas, programs, animation, movies, etc. Therefore, as online video has developed to the current stage, iQiyi must start to invest in self-made content on a large scale from a medium- to long-term perspective."

It is obvious that quantitative original self-made content can not only more accurately and deeply understand the characteristics and needs of the target audience, but more importantly, video website companies themselves can also enhance the attributes and characteristics of their own brands in self-made content.

Of course, iQiyi is only a member of the video website industry and cannot determine the future mainstream of the entire video website industry. However, looking at the quantitative changes from the qualitative changes, it is not difficult for us to predict something from it.

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.