Xiaomi TV head Wang Chuan: LeTV model is coming to an end

Introduction

Wang Chuan, co-founder and vice president of Xiaomi and head of Xiaomi TV, believes that LeEco not only produces content, but also invests in LeEco Pictures to produce movies, and also makes video websites and TVs. This is a typical closed model of one company taking over everything. But this closed model of one company taking over everything is about to come to an end.

Recently, we interviewed Wang Chuan, co-founder and vice president of Xiaomi and head of Xiaomi TV, and analyzed several companies in the industry. When talking about LeTV, Wang Chuan believed that LeTV's closed model of one-size-fits-all would sooner or later be proven to be unworkable. The following is his oral summary:

In the entire Internet TV industry chain, the upstream and downstream are divided into three levels. The first level is responsible for the production of film and television content, such as Warner, Huayi, Guangguang, etc.; the second level is video websites, such as Youku Tudou, iQiyi, Sohu Video, Tencent Video, etc.; the third level is TV terminals, such as Xiaomi TV, LeTV TV, and some traditional TV manufacturers.

There are two models in this industry: one is open cooperation, where each company only does one link, focusing on it, doing it well, and doing it thoroughly. But some people are greedy, and they think why don’t I do the entire industry chain? Every penny earned here is mine. So some companies are more closed, that is, I don’t rely on any of you, I do it from beginning to end, and I make all the money.

LeTV not only produces content, it has invested in LeTV Pictures to produce movies, it also runs a video website, and it also makes televisions. It is a typical closed approach where one company takes everything.

Many cases have proven that openness will definitely beat closedness, and cooperation will beat isolation. It is possible to be closed in a small industry, but it is completely impossible in an industry as large as Internet TV.

When Apple was making personal computers, it not only made computers, but also developed operating systems and application software. It was a one-size-fits-all business. At first, it had no rivals and occupied a monopoly market share. But later, IBM launched the IBM computer and cooperated with Microsoft, Intel and a large number of software companies. Soon, this open cooperation model showed great superiority and quickly surpassed Apple in the PC market. In the end, Apple's computer market share shrank to 4%. It was not until Jobs returned and the success of the iPhone that Apple was able to save the situation.

We believe that this situation will also happen in the Internet TV industry. LeTV was relatively successful before, mainly because they seized a loophole, which was that all parties in the industry chain did not cooperate. Think about it, LeTV's content is definitely not better than Warner, Huayi, and Guangguang; LeTV.com, as a video website, is far behind iQiyi and Youku Tudou; LeTV TV is also far behind Xiaomi TV.

However, LeTV's strategy is like Tian Ji's horse racing. It has TV terminals when compared with iQiyi and Youku, and it has content when compared with Xiaomi. If the industry does not cooperate, it will compare what it has with what you do not have, regardless of whether it is good or not. However, once excellent video content and excellent TV terminals cooperate, LeTV will have no advantage at all.

Xiaomi focuses on what it can do, and only makes TV terminals. Last year, Chen Tong joined Xiaomi and invested 1 billion US dollars to cooperate with content companies. We have invested in iQiyi PPS, Youku Tudou, Huace, and Xunlei, and promoted the delivery of these high-quality content to licensees, and provided them to all Xiaomi users through broadcast control.

You will soon see that the content on Xiaomi TV far exceeds that of LeTV TV. Why? Because those excellent content companies are unwilling to cooperate with LeTV, because LeTV.com is a competitor to Youku, iQiyi, Sohu, Tencent, and PPTV, and LeTV Pictures is a competitor to Huayi, Guangguang, Bona, Huace, Hairun and hundreds of other film and television production companies. This competitive relationship will inevitably make LeTV do everything, but it will not do well in everything and will be passive everywhere. LeTV's closed model of "one-size-fits-all" is about to come to an end.

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.