Can the stubborn Netflix break into the 200 billion Chinese video market?

Recently, the news that the American video website Netflix will officially enter the Chinese video market has become the most explosive and talked-about topic in the Chinese video website industry.

It is not uncommon for international Internet giants to enter the Chinese market with a huge number of users. However, when even Google, YouTube, Facebook and Twitter do not provide services in the Chinese market, how can Netflix become the leader among international companies in entering the Chinese video market?

The road to China is full of thorns

Netflix Chief Content Officer Ted Sarandos has made it clear that “we are unlikely to adopt a model of cooperation with local manufacturers because such cooperation is very complex, difficult to manage, and ultimately difficult to succeed.”

Sarandos's implication is that Netflix's entry into China will be a lonely battle, and it will also be full of thorns. Because Netflix, an outsider without a local partner, must not only try its best to cater to the Chinese user market, but also complete the application for the operating license required by the State Administration of Radio, Film and Television and the review work of the regulatory authorities. This is also the key to whether Netflix can truly enter China smoothly.

The current reality is that the State Administration of Radio, Film and Television has stopped issuing Internet TV licenses. Apart from the seven existing licensees, including China Network Television (CNTV), Wasu Media, Southern Media, China Radio International, BesTV, Hunan Radio and Television, and China National Radio, the State Administration of Radio, Film and Television may no longer issue new licenses to private enterprises.

This can also be seen from the license dispute between LeTV and Xiaomi last year. Therefore, if the State Administration of Radio, Film and Television issues new licenses, they will only be issued to local TV stations, not private enterprises, let alone foreign enterprises.

Although Sarandos has learned that Netflix will need to apply for eight different licenses if it is released in China, and that TV content "will need to undergo censorship and supervision that we have never seen before", Netflix will not allow itself to miss out on China, a market with huge potential, after achieving phased victories in other countries and regions such as Europe and the United States.

Competition from local rivals continues

Along with the news of Netflix entering China, there is also news that Alibaba has invested heavily in Enlight Media. Recently, Enlight Media has officially announced that Alibaba has invested 2.4 billion yuan in Enlight Media.

From this we can see that when it comes to content construction in the cultural industry, Alibaba not only has a positive attitude, but also takes frequent actions.

In addition to the media giant Light Media, which has invested this time, Alibaba has previously invested HK$6.244 billion and acquired 59.32% of China Culture Media's shares, becoming China Culture Media's largest shareholder and renamed it Alibaba Pictures.

Among the three major Internet giants BAT, Tencent's main product is Tencent Video, and Baidu has acquired iQiyi. In addition to being a broadcasting platform, the giants have also extended their business to the upstream film and television production and distribution field, such as the Huace iQiyi Film Company established by iQiyi and Huace Film and Television last year.

Compared with the other two competitors, Alibaba is a latecomer in the video industry, whether it is the acquired Alibaba Pictures or the newly acquired Enlight Media. However, this wealthy latecomer has achieved rapid expansion in the video and film industries through equity investment and acquisition.

Zhang Qiang, CEO of Alibaba Pictures, once said that Jack Ma invested in the video industry not to make money, but mainly because he saw the development potential of the Chinese film market and believed that the scale of this market could reach 200 billion yuan in the future.

The 200 billion yuan potential market is not only for the giant Alibaba, but almost all Internet companies are eyeing it. Even the involvement of the international video company Netflix will not discourage domestic companies from following the video industry market.

In fact, Netflix chose to act alone this time, driven by its own interests, and it also clearly recognized the objectivity of the surrounding environment. Under the premise that Netflix was unwilling to cooperate with local companies, perhaps it had predicted that such cooperation would be based on a conflict of interest.

Although industry insiders have said that Netflix's plan to enter China is extremely unlikely, both in terms of policy supervision and user base, foreign investment analysts still believe that "although Netflix's plan is very radical, it is still possible to achieve this goal as Internet-connected devices quickly become popular."

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.