LeEco announcement interpretation: the license issue will be completely resolved

From the closure letter in June to the talks with licensees in July, and then to the legendary Order No. 292, the State Administration of Radio, Film and Television's recent series of rectification measures targeting Internet TV can be described as urgent.

Some industry insiders believe that this series of regulatory measures is just an in-depth implementation of the previous Document No. 181, and the fluctuations in LeTV's stock price caused by rumors that "LeTV was named by the General Administration as 'seriously violating regulations' and its cooperation with integrated service license holders was terminated" is just an adverse reaction to a market that has not yet established regulations.

Last night, LeTV officially released an announcement to clarify the false reports and related rumors.

1. LeTV and CCTV still maintain cooperation;

2. LeEco has only suspended cooperation with other licensees, and will continue cooperation after rectification is completed;

3. LeEco will completely resolve the licensing issue and actively apply for content licenses under the guidance of regulatory policies;

4. This regulatory incident will not affect LeTV’s business model.

As for the content of the announcement, LeEco has admitted that some content on the LeEco Box did violate regulations, and the process of being regulated is just to rectify the content of the box. Currently, LeEco's official website has taken the initiative to remove the sales of the LeEco Box, and will resume online sales after the rectification is completed.

In fact, the rectification work of the radio and television on the Internet TV market is not aimed at the policies and regulations implemented by LeTV alone. As early as in the "closure letter" distributed in mid-June, the radio and television had criticized Alibaba's "Tmall Magic Box" and BesTV's "Little Red Internet TV Set-Top Box" by name. In yesterday's stock price fluctuations, the stock prices of local radio and television companies such as Gehua Cable and China Media Group also fell.

LeTV, which started out as a video website, has been actively improving every link in the industry chain since it decided to build the LeTV ecosystem of "platform + content + terminal + application", including LeTV.com, LeTV Zhixin, LeTV Pictures, LeTV Holdings and other companies. LeTV Box is just another link in LeTV's terminal, which is not enough to affect LeTV's entire ecosystem and LeTV's inherent business model.

At present, the tightening of monitoring in the field of Internet TV is mainly to clean up non-standard operators, while video websites such as LeTV have outstanding content advantages and have long adhered to the principle of genuine products. It can be said that this industry cleanup and compliance will be more conducive to the long-term development of video websites with outstanding copyright advantages.

The reason behind the successive policies issued by the State Administration of Radio, Film and Television is not to curb the development of the Internet TV market, but to purify Internet content, eliminate homogeneity and combat piracy. Judging from the fluctuations in LeTV's stock price yesterday, it was obviously a bit excessive.

On the other hand, LeTV has actively cooperated with the rectification work and stated that it will cooperate with the content service license holders, either jointly apply for new content service licenses, or operate with existing content service licensed institutions to completely resolve the key issues related to the license. The radio and television will also accept LeTV's rectification work with due attitude and use it to establish the norms of the Internet TV market.

At the same time, according to the response from LeTV, LeTV will focus on applying for content service licenses in the future as a response to the strict supervision of radio and television. Although pressure from multiple parties has led LeTV to embark on the road of rectification, it has also led LeTV to make early arrangements in the development of the Internet TV industry. Compared with the companies that escaped the naming storm this time, the "disaster" has actually put LeTV ahead of its competitors.

Some industry insiders also believe that although the current rectification of the Internet TV industry seems to be mainly aimed at the impact of unlicensed Internet video business on radio and television control, it actually also reflects the radio and television's concerns about being marginalized in the "three-network integration" of telecommunications network, radio and television network and Internet. Radio and television hopes to find a path to the three-network integration through rectification.

From the perspective of the entire Internet TV industry, the current rectification of Internet TV licensees by the Radio and Television Administration is actually aimed at restoring a manageable and controllable Internet TV market. As a particularly prominent enterprise manufacturer, LeTV may lead the entire industry to start healthy market competition after successful rectification, and make the Internet TV market, which is disorderly in copyright and rampant with counterfeiting, develop in a standardized and sustainable direction.

In summary, this rectification storm will bring changes to the interests of licensees, content operators, local cable TV, and TV manufacturers in the Internet TV industry chain. In the long run, industry norms will be beneficial to licensees and TV manufacturers, while non-standard Internet video content operators and copycat box manufacturers will be restricted.

As the only purely domestically-owned Internet listed company among China's large Internet companies and having accumulated a large number of users in recent years, LeTV was the first to be pushed to the forefront of the current rectification by the Radio, Film and Television Administration. However, as a large Internet video company with a loud voice and rich content, if LeTV can cooperate with the official rectification this time, it will surely become a model for the entire market and attract attention and emulation within the industry.

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.