Cannes – Since the merger of China’s two biggest video websites in 2012, Youku and Tudou’s consolidation still remains the best search for economics of scale in China’s internet industry as growth eases from its torrid days. The covenant produced an obvious industry frontrunner and also improvements to the web structure and the underlying economics of the online video sector in China.
Yang said, “With Youku and Tudou, we have reached 900 million users in China since the merger. That means more than half of Chinese people visit Youku and Tudou and in terms of time spent, Youku’s habitation now ranks number two in the China market for mobile applications. Meaning, Youku and Tuduo is the top favourite mobile application in China. We are also the number one video site of the nation.
“Our model is based on advertisements but as of Q4, 2014, our paid subscription increased to 1 million members paying nearly 12 Euros per year. People ask me what is the difference between Youtube, Netflix and Hulu globally? Youku and Tudou is actually a mixed model – it’s YouTube plus Netflix plus Hulu. First, Youku and Tudou is the largest platform for user generated content (UGC) and professionals generated content (PGC) in China. In this part of the world, Youku and Tudou equals to Youtube.”
Yang went on to explain the second part of their content endeavour which is buying of copyrights from TV stations, distributors and overseas operators for drama series and variety shows, entertainment and documentaries. The third is based on content produced by his team. Hence, Youku’s contents derive from three resources. The UGC and PGC version is basically the Youtube model, original content production is the Netflix model and the copyrights purchased from various sources globally is the Hulu model.
Since their decision to purchase formats from top production companies and top TV stations, they started to co-produce and cooperate with top production companies globally and co-production with Korean companies such as SBS and CJ E&M. This model injects local culture into the programmes they were developing, which is better than simply buying programmes. “China’s local culture is different from Europe and America. Perhaps, we share similar cultures with Japan and Korea. In China, Korean programmes are most popular in TV stations and the most successful format from America or Europe is The Voice.
The most important factor is the ability to adapt this format into the local market with strong local insights.
“This is the most important factor because when we do something to the ‘global camera’, some ‘cameras’ disagree, as their formats cannot be altered. For example, the Voice of China is different from the original version as it was localised to suit the Chinese market. We have no intention to penetrate into Europe and America so far as China is a huge market.
We have position ourselves in cultural and entertainment content. We wish to purchase IPs and invest in Japanese animations and coproduce with Korea companies for variety shows,” added Yang.
He explained that viewer’s behaviour is towards digital content today on mobiles and tablets as TV content is controlled by the government in China. 70% of Youku and Tudou’s traffic comes from mobile applications and more from android devices – Samsung or Xiaomi. Youku spends as much as 100 million Euros annually to purchase programmes.
Cannes – Since the merger of China’s two biggest video websites in 2012, Youku and Tudou’s consolidation still remains the best search for economics of scale in China’s internet industry as growth eases from its torrid days. The covenant produced an obvious industry frontrunner and also improvements to the web structure and the underlying economics of the online video sector in China.
Yang said, “With Youku and Tudou, we have reached 900 million users in China since the merger. That means more than half of Chinese people visit Youku and Tudou and in terms of time spent, Youku’s habitation now ranks number two in the China market for mobile applications. Meaning, Youku and Tuduo is the top favourite mobile application in China. We are also the number one video site of the nation.
“Our model is based on advertisements but as of Q4, 2014, our paid subscription increased to 1 million members paying nearly 12 Euros per year. People ask me what is the difference between Youtube, Netflix and Hulu globally? Youku and Tudou is actually a mixed model – it’s YouTube plus Netflix plus Hulu. First, Youku and Tudou is the largest platform for user generated content (UGC) and professionals generated content (PGC) in China. In this part of the world, Youku and Tudou equals to Youtube.”
Yang went on to explain the second part of their content endeavour which is buying of copyrights from TV stations, distributors and overseas operators for drama series and variety shows, entertainment and documentaries. The third is based on content produced by his team. Hence, Youku’s contents derive from three resources. The UGC and PGC version is basically the Youtube model, original content production is the Netflix model and the copyrights purchased from various sources globally is the Hulu model.
Since their decision to purchase formats from top production companies and top TV stations, they started to co-produce and cooperate with top production companies globally and co-production with Korean companies such as SBS and CJ E&M. This model injects local culture into the programmes they were developing, which is better than simply buying programmes. “China’s local culture is different from Europe and America. Perhaps, we share similar cultures with Japan and Korea. In China, Korean programmes are most popular in TV stations and the most successful format from America or Europe is The Voice.
The most important factor is the ability to adapt this format into the local market with strong local insights.
“This is the most important factor because when we do something to the ‘global camera’, some ‘cameras’ disagree, as their formats cannot be altered. For example, the Voice of China is different from the original version as it was localised to suit the Chinese market. We have no intention to penetrate into Europe and America so far as China is a huge market.
We have position ourselves in cultural and entertainment content. We wish to purchase IPs and invest in Japanese animations and coproduce with Korea companies for variety shows,” added Yang.
He explained that viewer’s behaviour is towards digital content today on mobiles and tablets as TV content is controlled by the government in China. 70% of Youku and Tudou’s traffic comes from mobile applications and more from android devices – Samsung or Xiaomi. Youku spends as much as 100 million Euros annually to purchase programmes.
