The battle for set-top boxes: a historic test for the State Administration of Radio, Film and Television

The Internet is impacting more and more traditional industries like a flood. Some have been completely defeated, while others are still resisting tenaciously, such as the State Administration of Radio, Film and Television. The ban on Internet set-top boxes does not show how powerful the State Administration of Radio, Film and Television is. Instead, it exposes that under the impact of the Internet economy, the deep-rooted chronic diseases of the radio and television system have become a serious disease. The external market continues to exert pressure, and the internal transformation is progressing slowly. The embarrassing situation of internal and external troubles has made the State Administration of Radio, Film and Television attacked from all sides. Whether it can turn danger into safety will be a historic test.

Why did the State Administration of Radio, Film and Television ban Internet set-top boxes?

What is the real reason why the State Administration of Radio, Film and Television banned the Internet set-top box? From the current explanation, the most influential reason is to control the TV side with strong credibility and guard against extreme or foreign forces taking the opportunity to brainwash the domestic people. In a sense, monitoring live TV is in line with the current national conditions. Western powers have been eyeing China and constantly making small moves. Reasonable supervision is indeed necessary. However, apart from this reason, did the radio and television have no selfish motives when banning the set-top box?

In fact, video websites know what they can and cannot do. Even if they are allowed to provide OTT live broadcast services, they dare not broadcast prohibited content, and will honestly obey the arrangements of the General Administration of Press, Publication, Radio, Film and Television on content broadcast control. The radical ban on network set-top boxes by the State Administration of Press, Publication, Radio, Film and Television is more worried about further losing control of TV screens. Internet videos have diverted a large part of users. If video websites enter the field of TV live broadcast, the possibility of radio and television losing in the competition is very high.

In addition, if OTT live broadcast services are opened, the revenue of radio and television will inevitably be greatly diverted. The first thing to be affected is that the service fee of digital TV will be greatly discounted. Internet set-top boxes are free, and they have many channels and more content. Digital set-top boxes are charged, and they have few channels and limited content. If the two boxes are put in the same market, the digital set-top boxes will lose without a comparison, and radio and television cannot afford to lose at present. On the other hand, in addition to diverting users, Internet video has also robbed a large number of advertisers of advertising budgets. If video websites are given the right to provide OTT live broadcast services, the advertising revenue of radio and television will be further divided.

Moreover, on the surface, this battle is an open and covert struggle between the State Administration of Radio, Film and Television and video websites, but in essence it is a game between radio, film and television and operators. Although video websites should be subject to the management of radio, film and television in name, they represent operators who provide the basis for Internet services. If radio, film and television lose in the competition with video websites, it indirectly means that radio, film and television are suppressed by operators, and the resulting impact will be a setback in administrative status.

However, the above is just speculation. Please decide for yourself what you believe.

Video sites and box manufacturers will not give up

Every policy has its countermeasure. Although under the tyranny of the State Administration of Radio, Film and Television, video websites have succumbed and removed their respective TV version APPs, it does not mean that video websites will obey. Various means of inducing users to download and use them spontaneously have emerged in an endless stream. Even smart TVs are no longer called TVs but are called living room computers.

The video websites have not done anything illegal, and the SARFT has no right to suspend anyone's Internet audio-visual license. If the name is not right, the words will not flow. Under the condition of complying with the rules, the SARFT's restrictions on video websites can only work temporarily, not indefinitely.

If, under the conditions of complying with relevant regulatory requirements, radio and television can provide users with better services, cheaper service prices, more TV channels, and richer TV content, if radio and television can do these, users will not need Internet set-top boxes at all, and OTT live broadcast services will lack room for growth.

Now it is because the radio and television cannot do better, so users spontaneously give up digital TV and choose Internet set-top boxes. The current situation is caused by the radio and television itself. The semi-open business model only allows local radio and television to compete with each other within the system. When placed in the same market with Internet video companies, the radio and television system can no longer handle it.

Seeing this rare opportunity, the major video websites will certainly not give up. At present, they are only yielding to the radio and television under pressure of license confiscation. However, while yielding, the major video websites will not sit idle. On the one hand, they will put pressure on the radio and television through public opinion, and on the other hand, they will change various methods to continue to promote OTT live broadcast services. The radio and television ban cannot be a one-time solution, unless they find some reasons to completely confiscate the Internet audio-visual licenses of video websites that have made small moves to make an example of them. Otherwise, the radio and television will be busy.

Semi-open competition has caused internal divisions in the radio and television system, resulting in inconsistent will and making it difficult to resist external invasion.

In fact, the SARFT is not completely closed. At least within the SARFT system, there is active competition between local SARFTs. The SARFT allows competition between TV stations because no matter how fierce the competition between TV stations is, they are all under the management of the SARFT and their revenue is their own money. If they allow video websites to develop OTT set-top box business, it will be different. Who would be willing to let outsiders come to share their own pie?

Ideally, the radio and television departments have a way to deal with the competition from video websites. Refusing to sell the copyrights of popular programs will make it difficult for video websites to cope. The form of live TV service has created popular programs and TV series. To a certain extent, video websites still follow the radio and television department. Some popular programs still need to purchase copyrights from the radio and television department. If the radio and television department can unify its will and would rather sacrifice some interests and refuse to sell the copyrights of popular programs to video websites, the value of video websites will be greatly reduced.

However, this is not very realistic, because the marketization of radio and television brought about by institutional reform has led to some local radio and television businesses becoming listed companies, and listed companies still have to pay attention to profit factors. In addition, the radio and television system has been fragmented for a long time, and the interests among them are complicated, so it is difficult for local governments to unite.

However, judging from the fact that Hunan Satellite TV has consciously begun to refuse to sell the online copyrights of some popular content in the first half of the year and instead promoted its own Mango TV website, this is a positive move for the State Administration of Radio, Film and Television. From the perspective of the State Administration of Radio, Film and Television's response to the impact of video websites, other local radio and television stations should be encouraged to follow suit.

In addition, the State Administration of Radio, Film and Television can try to make some further efforts, that is, to unify the local radio and television under the self-built video website, with the State Administration of Radio, Film and Television as the main website, and the video websites of local channels such as Mango TV and Blue Sky as sub-sites, and the operation rights of each sub-site belong to each of them. Simply put, everyone is just performing on the stage set up by the General Administration, and the performance depends on the ability of the local radio and television. Although this method is not a long-term solution, it can at least make a good start for the future development of online video services by local radio and television.

I checked the relevant information but couldn't find any definite statement. I don't know whether the "China Radio and Television Network Co., Ltd." which was listed not long ago is already doing this. I have to ask insiders for advice.

The radio and television system has just won the first opportunity of the three-network integration and cannot tolerate the disruption of video websites

The listing and establishment of China Radio and Television Network Co., Ltd. means that radio and television have finally suppressed the telecom operators in the long-debated three-network integration. In theory, "State Grid" has the policy conditions to become the fourth largest operator, but in reality, the registered capital of 4.5 billion is just a drop in the bucket for the terribly expensive operator services.

The establishment of State Grid means that radio and television can use State Grid to complete the transformation of its own business and business model, but this takes time. Whether it is the transformation of the original infrastructure and technology upgrades of radio and television, or the redeployment of power to local radio and television, it will take a certain amount of time to do it, and each problem is a big and difficult problem.

Radio and Television needs time now. They cannot tolerate the opportunity of the three-network integration being destroyed by video websites. If they are not careful and are overthrown by video websites, the management rights of the three-network integration will have to be transferred to operators. Therefore, the radio and television use of the 181 document to restrict video websites from providing OTT live broadcast services may be a delaying tactic. When the General Administration is ready, it will naturally open up this field. After all, whether from the market trend or the decentralization intention of the top leaders, the call for video websites to obtain OTT live broadcast services will only get louder and louder.

Can the SARFT compromise when video websites and local radio and television stations are combined?

Faced with the ban by the State Administration of Radio, Film and Television, video websites racked their brains and did their best. LeTV chose to marry Chongqing Radio and Television and jointly apply to the State Administration of Radio, Film and Television for an Internet TV integrated broadcast control service license or an Internet TV content service license. The State Administration should seriously consider this form, which is a signal that video websites are bowing to radio and television. In other words, the marriage between video websites and local radio and television is to obtain a legitimate broadcast qualification, which also means completely obeying the leadership of the State Administration of Radio, Film and Television in content.

If LeTV and Chongqing Radio and Television set a precedent, more video websites will follow suit, and the State Administration of Radio, Film and Television can also use this method to bring more video websites under its control. Now it depends on whether the radio and television are willing to accept this form of surrender.

The Set-Top Box Contest: A Historic Test for the State Administration of Radio, Film and Television

For the radio and television, in addition to fulfilling the responsibilities entrusted by the state, it is also necessary to develop itself in the long run. The dispute over set-top boxes has exposed the dilemma of the radio and television. Whether it can safely survive this incident is a historic test for the State Administration of Radio, Film and Television. Judging from the current situation, this incident is unlikely to be resolved in a short period of time, and it will only intensify. After all, this is a dispute over interests that are of life and death to all parties.

The State Administration of Radio, Film and Television has only suppressed the first wave of impact from video websites, and the counterattack from video websites will not take too long. Now, there are not many options for the State Administration of Radio, Film and Television. Either it completely kills this trend through tough measures; or it quickly completes its own comprehensive transformation; or it guides local radio and television to form a group to compete with video websites; or it agrees to the marriage request from video websites. Among these, some cannot be done, some are impossible, some cannot be done, and some still need to be studied. This is really a historic test for the State Administration of Radio, Film and Television, because the price of failing is to become "history", and radio and television cannot afford it.

The battle for set-top boxes has not yet ended completely. Faced with the aggressive moves of video websites, the State Administration of Radio, Film and Television must adopt a combination of carrot and stick tactics. It will not work if it is too hard or too soft. This really puts the State Administration of Radio, Film and Television in a difficult position.

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.