Take two boats: Xiaomi shares Iqiyi and Youku, where is the mystery?

According to sources close to the investment circle, Xiaomi’s upcoming investment is the Youku and Iqiyi of the first tier of the video website. Which will take out hundreds of millions of dollars to share in iQiyi, become its second shareholder, the proportion of shares is unknown, in addition to buy Youku stocks in the secondary market, the specific amount is also believed to be tens of millions. At the same time, Xiaomi, Baidu and Youku will also have deeper cooperation in their content, and the specific form is still unknown.

But the news that has been revealed is enough to be eye-catching: When Xiaomi announced Chen Hao was responsible for Xiaomi's content strategy, most people would probably not think of or believe that Xiaomi’s first investment object was Iqiyi and Youku. The outsiders who have been outside the video circle for a long time and the aggressive careerists who have been trying to dominate the video circle have finally come together. In addition, Xiaomi took two boats and took Youku and showed his great desire for quality content.

The domestic video circle that has been strongly suppressed by the SARFT for half a year will probably be bustling again for a while.

Aiming at video sites: Xiaomi exchanges time for money

Let's look at the big move: what is Xiaomi's share of love in Qiyi? What is the purpose? Talking about the cooperation between the two companies in the video business, it is necessary to reverse the clock and return to October 9: At that time, China’s largest private film and television company, Huace Film and Television announced the latest set-up plan with a total value of RMB 2 billion. Among them, two of them will be targeted at the Dinglu Central Plains (Baidu Department, to subscribe for 1 billion yuan for this largest buyer), and Beijing Wali (millet line to subscribe for 50 million to be the smallest subscriber). Today, they begin to shake hands across the river.

Judging from the quarterly earnings report, Baidu’s revenue continues to improve, and it’s hard to imagine that Baidu will allow Xiaomi to plug in. However, looking at the domestic video circle shopping and fierce competition, more and more money in Baidu seems not a good thing, and hand-heavy but eager to resource the millet can hit it off. Judging from the current flow of information, the benefits of the transaction to the three parties outweigh the disadvantages.

1. Targeting content, license multiple insurance: Xiaomi exchanges time for money

Undoubtedly, Xiaomi has not only started late in family entertainment, but also has developed slowly. Lei Jun’s use of Chen Hao and the US$1 billion to make Internet TV content is also the weakest link in the “millet ecosystem”, with all parties involved. The decent amount comes to the most rapid compression of time costs.

1 Joining iQIYI and Youku is the quickest way to achieve massive content. In 2014, iQIYI was madly amassed in the field of self-control and copyright content. According to the 2015 year plan of iQIYI, there were 30 episodes of 500 episodes and 15000 minutes, and there were also various variety shows and copyright programs. These content advantages are the biggest shortcoming of Xiaomi's Internet TV and become the second largest shareholder of iQIYI. Not only do they have access to a considerable amount of genuine content on iQIYI's website, but they also gain access to iQiyi's film industry and even China IT's film and television content. On the other hand, Xiaomi may have priority. Similarly, Xiaomi can also apply this method to Youku. However, because of the different investment quotas, there may be some differences in depth.

2 The policy threshold. Doing Internet TV cannot bypass the SARFT and Internet TV broadcasting control licenses. As early as July 2012, iQiyi established Galaxy Connect with the broadcast and television platform platform of the Internet TV broadcasting platform Fang Guangguang New Media and other broadcasting departments, laying the foundation for the Internet box and Internet TV. And because of this, iQiyi was less damaged in this year's SARFT control and control storms (later you could even follow the iQIYI to curve into the living room, spending 50 million yuan to buy shares in the Guangdong side of the country). After investing in iQIQI, the licensees that cooperated with Xiaomi were iCNTV and Galaxy, and they obtained double insurance on policy access. If you counted Guangdong's national broadcast control license, then it was three insurance.

2. Bi-directional betting intended to avoid confrontation with giants

Hundreds of millions of dollars have made iQIYI Youku a bloody capital. Different from the announcement that Youku is announcing that profits are expected or even profitable, Ichiyi CEO Gong Yu has repeatedly stated that video sites have no hope of profitability in the short term, and iQiyi has no profitable timetable. This time, it will make this video boss a battle for competition and create new variables in various fields such as content production, copyright scramble and infrastructure construction.

Iqiyi mobile or profit. Unlike the purchase of Youku stocks from the secondary market, the direct stake in Yiqiyi in Xiaomi means that from the content to the app distribution, iQiyi will be included in the Xiaomi ecological chain: the download bonus that Xiaomi Store can bring to iqiyi is obvious. of.

Xiaomi avoids direct confrontation with the multi-gold Ali. Although some media believe that Xiaomi’s valuation has exceeded US$50 billion, there is still a qualitative gap compared to Alibaba’s exceeding US$200 billion in market value, which is still rising, and thus, at the same time that several hundred million US dollars are invested in Iqiyi, Buying Youku shares again shows a clear mentality: Xiaomi is just for premium content and will not be able to get involved in the BAT capital war.

Second, still fine-tuning video, do not change the general trend

When Chen Hao received the $1 billion that Lei Jun gave, there were two roads before him. One was to take the video website again: buy copyright, do self-control, and cooperate with the licensee; one is to invest in shares. Video sites get a lot of quality resources in the quickest way.

In the end, Lao Chen still cleverly chose the latter option of spending less time and money.

This is a sign that Xiaomi’s attitude toward video content has changed dramatically. But for mature video circles, hundreds of millions of dollars is not a big figure for video sites: if you use the 2013 Youku financial report as a benchmark, hundreds of millions of dollars may not be able to support the scale of the iQIYI. The annual expenditure of a video site. Therefore, the direct intention of Xiaomi’s entry is nothing more than that, so that Youku and Iqiyi continue to compete for content, and they are further away from other opponents. Xiaomi himself profits from it.

1. Xiaomi needs to soothe Youku potatoes

Any turmoil in the first echelon of the video circle will make Youku nervous. After iQiyi’s capital increase, it may cause the two sides to escalate the content resource grab. Gong Yu's phrase “Lost in a mess, but also has to buy a hand” may cause Youku to have to pay higher costs for premium content, which is followed by more ugly financial data. The advantages of Xiaomi on the mobile side will also give Iqiyi a bonus, and the mobile users of both parties will fight for the battle. The outcome is no suspense.

Xiaomi's cooperation with Youku in terms of content is nothing more than two ways: one is to purchase copyright, and the other is to cooperate with Heyi Cinema. Although Xiaomi also purchased Youku’s shares, the information revealed is that the amount is small and there are obvious signs of comfort. As for how to do it without stirring the emotions of Baidu and Ali, it depends on how Xiaomi's balance technique is.

2. Let's be careful

In the field of Internet TV, Xiaomi and LeTV’s talent war has never stopped. It is no surprise that the entire department jumped from one side to the other, and the iQiyi’s TV+ free-to-play model is obviously aimed at LeTV’s charging model.

Although LeTV’s current Internet TV sales have already surpassed rivals, “enemy's enemies are friends”, complementing the content-defective Xiaomi Internet TV, with double (3) licenses, suggesting that it may launch multiple products to compete in the future. . Opponents catch up with radio and television squeeze Le Le as quite embarrassing. As an old friend of Lao Chen, Leo’s COO Liu Hong did not know what to think.

3. Will Tencent and Sohu Video Lose?

In the home Internet domain, Tencent and Sohu Video have never had any major moves. After SARFT tightened supervision, Tencent and Sohu can only stay at the PC and mobile terminals. Tencent and Sohu, who have no hardware and can't implant apps into TVs, may have once again distanced themselves from their peers for the actions of Xiaomi. If coveting family entertainment, the best option left is to cooperate with LeTV. The premise, of course, is that LeTV should come out of the whirlpool of public opinion and policy.

All in all, Xiaomi’s mentality in developing Internet TV business is obviously urgent, but it is difficult to win without direct, continuous, and stable content input. The millet, who does not want to be deeply involved in the competition between video and capital content, intends to use four or two ways to make profits. However, hundreds of millions of dollars are spent in video circles, such as throwing a pebble into the pond. Notice Even if you share in iQIYI, you should understand that the latter and TCL are still cooperating to produce internet TV. Therefore, how to deal with the iQIYI's existing internet TV business is another challenge for Xiaomi.

I hope millet has left behind before entering the pit.