An In-Depth Analysis Of The Chinese Short Video Market
摘要： What are the major players in the Chinese short video market? What strategies do they adopt in order to survive? What’s the secret to their success? What problems are they facing right now?
While Twitter “killed” its short video app Vine last year, 12-year-old YouTube embraced a second spring in the era of short videos. While Insatgram and Snapchat firmly hold the short video community and social networking market, no other similar service providers can see any opportunity. Drawn by the popularity of Vine, the Chinese short video market finally ushered in an outbreak of development for the past two years after reaching a nadir.
Although Tencent is the dominant player in the short video social networking sector, both veteran service players and late entrants in the short video sector are leading the trend in their respective aspects, from social networking to algorithm distribution. That’s also why Kuaishou, Toutiao and Miaopai all claimed that they ranked 1st in the market. In fact, they are competing with each other in various aspects, from the number of users who post new videos constantly, view times to platform fee.
Drawn by the rise of super IPs and investors’ blind investment, the golden development period for the Chinese short video market is coming at a speed faster than that in the era of we media. However, major Chinese short video service providers still find it hard to cover the cost and make ends meet, though they benefit most. In this case, the large number of copycats chose to survive by copying or stealing and cutting contents from other platforms when they see no opportunity for returns in a short period.
As the Chinese mobile internet world is increasingly penetrating third, fourth, fifth and sixth-tier cities under the logic that traffic is the king, copycats that appeal to grassroots users, instead of those targeting middle class and vigorously pursued by capital investors, have become the unstoppable force in this wave.
At this point, it’s time TMTpost conducted a comprehensive evaluation of all major Chinese short video platforms, summarized their strengths and weaknesses, sorted out the content production and distribution mechanism and analyzed the composition of content producers on different platforms.
Above all, let’s figure out why did the overseas short video social networking is still in full swing, while the Chinese short video content market is in the ascendant.
The Chinese short video social networking market
When YouTube and Instagram failed to pay proper attention to the mobile end and short video, respectively, Vine seized the opportunity and rose to popularity; however, when YouTube and Instagram realized the problem, they soon caught up. While YouTube grabbed grassroots celebrity, Instagram grabbed stars and internet celebrity. This may help explain why Vine failed to maintain its dominance.
More importantly, Vine failed to create and nurture an environment as diversified and talented as that on YouTube, as artsy and fashionable as that on Instagram. Besides, Vine stuck to six second videos, which seems quite easy but is actually quite demanding on users. Therefore, many stars and celebrities prefer to share their life via sixty-second short videos on Instagram. After all, it’s unlikely to win over a large number of fans through simply six-second videos. To a degree, six-second videos are closer to GIF images.
In this case, it seems that users will prefer to use Vine in high frequency and in long term in social networking scenarios. However, after Twitter acquired the “social media” Vine, it emphasizes more on the “media” function than the “social” function. That’s why Vine failed to become a social networking tool as popular as Snapchat.
Snapchat managed to stand out regardless of the competition from Facebook and Instagram because both Facebook’s Whatsapp and Instagram’s short video community were no rival to Snapchat. It was not until last year that they, driven by Snapchat’s huge success, paid back Snapchat in its own coin, copied Snapchat and added similar functions on their platforms.
Compared to the fierce competition in the American short video market, there’s no much suspense here in China. Both WeChat and QQ belong to Tencent, while Weishi also ends up being acquired by Tencent.
In a previous article titled “Snapchat’s Counterpart Isn’t Likely To Succeed In China”, I’ve mentioned that: “QQ is more ambitious and pioneering than WeChat in terms of trying out new things such as short video social networking. In comparison, WeChat is rather too timid and meticulous as to short videos, since it has to take care of the vast variety of users, from grandparents, parents to young people, from first to seventh-tier cities.”
The reason why the Chinese short video market finally boomed is that after traditional video platforms that rose along with YouTube in the US such as Youku, Tudou and 6Rooms failed in their short video attempt, these platforms all shifted to long video platform (film, TV series and entertainment). Since there’s no platform in China as dominant as YouTube in the US, other late entrants have the opportunity to play a role and embark on a long-term fight.
The suddenly-changed Meipai & the regulated Kuaishou
Although Vine ended up in sigh and failure, its counterparts survived here in China, though they’ve been through rounds of transformation. Some relies on social media platforms, others target a specific group of users, while the rest manage to develop stealthily in less-known corners. In a word, they’ve all managed to find their own living spaces by targeting their own users.
After Miaopai was recognized as the official short video tool on Sina Weibo, it became a popular tool for stars and internet celebrity to share their lives (I shall dive into more details later in this article).
After many celebrities moved to Miaopai (similar things happened to Vine), Meipai had no choice but to focus on its photo editing and beautifying function (It is said that the ratio of female and male users on Meipai once reached 19:1). However, after live streaming service was added to Meipai, male users poured in drawn by the large number of female streamers.
When good-looking users all turn to live streaming platforms, only grassroots talents (those who can eat lobsters with bare hands, knitting instant noodles with needles and play website-based games) would continue to post videos in short video communities.
As Meipai’s homepage becomes similar to that of Kuaishou, its product ideology is also moving towards Kuaishou’s. Last June, I wrote an article titled “Why Can’t Kuaishou Rise Into China’s YouTube?” and compared the homepage of Meipai and Kuaishou. At that time, while Meipai’s mature product ideology can be easily recognized from buttons such as Channel, Ranking and Recommended Topics on the homepage, Kuaishou’s homepage is in a mess, with simply three functions: Followed, Explore and Local.
While Kuaishou Instagram learned from Instagram, don't allow users to “repost” others’ videos and encourage them to post their own videos instead of mainly focusing on stars and internet celebrities, Meipai encourages users to repost videos their live to their friends.
However, when I opened Meipai, I even doubt if Meipai has poached product manager from Kuaishou: all the channels are folded on the homepage, while all the videos can only be “liked” and can’t be “reposted”. After Sina Weibo grabbed lots of stars and internet celebrities from Meipai, it realized that it could no longer imitate Sina Weibo. Therefore, it had no choice but to learn from Instagram and Kuaishou.
It turns out that Meipai’s transformation was quite successful. According to the Top Fifteen Chinese short video apps in 2016 list issued by Cheetah Global Lab, Meipai followed Kuaishou and TouTiao closely and ranked the fourth. No idea why Snow Camera and selfie tool Faceu were also included in the list.
For sure, Meipai still lagged far behind Kuaishou in terms of penetration rate and MAU. With a DAU of 40 million and MAU of 150 million, Kuaishou has every confidence to say that it is the number one short video app in China.
It’s obvious that the image scandal in 2016 not only didn’t affect Kuaishou, but instead boost its development in first, second and third tier cities. Drawn by the novelty, many people wound download the app. At the same time, CCTV and other media’s criticism didn’t affect Kuaishou’s popularity among its loyal users.
Although Kuaishou poached Zeng Guangming, former vice editor-in-chief of NetEase, to ease public criticism and media curiosity, it didn’t explain why Kuaishou was so popular among grassroots young people. As Sina Weibo, Meipai and Toutiao began to seek users among this group of people, Kuaishou posed a huge challenge.
In my previous article titled “Why Can’t Kuaishou Rise Into China’s YouTube?”, I’ve provided a tentative explanation. However, when Su Hua, CEO of Kuaishou, revealed the algorithm beneath Kuaishou’s over-simple homepage, I am amazed that Kuaishou don’t have any editor, and the entire recommendation function is run by the algorithm. In other words, Kuaishou might be even more reliable on algorithm than TouTiao, which often boasts “algorithm first”. After a month’s experiment, a friend of mine told me that Kuaishou’s algorithm was so accurate that it could predict that if a use prefer billiard techniques or poker and domino.
Therefore, if you only watch billiard and magic shows on Kuaishou, you won’t be recommended short videos featuring someone eating flesh intestine or burying him/herself. Still, short videos featuring someone ghost dancing, screaming and singing against microphones and doing other weird things are never too popular on Kuaishou.
Although Su told journalists that “magical countryside” doesn’t equal to Kuaishou, he can’t deny that the popularity of such short videos on Kuaishou reflects the “entertainment preference” of some grassroots Chinese.
Behaviors that challenge moral or even legal limit are encouraged and imitated since short videos featuring similar behaviors are so popular on Kuaishou. Such behaviors have found their way in the subculture of grassroots Chinese until they annoyed the mainstream. Although Kuaishou is innocent to some degree (since it’s only a platform), it is still to be blame. By adopting “non-interference and non-management” strategy, it is actually adding fuel to the flame.
Althoguh Zeng might help Kuaishou better deal with legal and moral risks, it is still too tricky a problem. Whether Kuaishou can set a proper limit is testing the wisdom of Kuaishou’s developers.
Still, Kuaishou is smart enough by not adding live streaming service. On the one hand, accidents might happen live streaming, which are things Kuaishou will do everything to avoid (a streamer might bury himself with a tractor but go too far and end up killing himself); on the other hand, live streaming relies more on constant interaction between streamers and audience, while short videos draw attention through sensation and insanity. While workers’ association may regulate streamers’ behavior, similar organization may become a “Incantation of the Golden Hoop” for grassroots who posted sensational short video.
Still, Kuaishou enjoys a solid grassroots user base, so there’s large room for growth and development. After all, nearly half of grassroots internet users aren’t short video users. When they learn the idea and look for a short video app, Kuaishou might be their top choice.
The “carrier ” TouTiao
TouTiao is also eyeing on the increasing number of grassroots Chinese smartphone users. For sure, there’s going to be a battle between Kuaishou and TouTiao in terms of target users, distribution mechanism and growth speed.
In nature, they aren’t the same. While Kuaishou is a UGC-based original video platform, with a couple million original videos being uploaded every day, TouTiao is a UPGC-based short video platform, with over one million videos being uploaded every month. According to TouTiao’s statistics, among 990,000 videos uploaded to TouTiao last October, merely 59,000 are original videos. Still, since their user base overlaps a lot, both of them attach high importance to algorithm.
On platforms such as Tianya.com, PostBar, Douban and Sina Weibo, which all went through the transformation by social networking, users often live in first and second-tier cities and know which stars or talents to follow in areas they are interested in. However, mobile users in fourth and fifth-tier cities don’t know who and what to follow. Therefore, several channels and interest tags on the top of homepage mean nothing to them.
Therefore, Kuaishou and TouTiao, which both feature over-simple homepage, better appeal to this group of users. Although TouTiao divides short videos through various tags such as Fun, Society, Entertainment, Film, Cute, etc., they actually all belong to quasi-entertainment and fall into a narrow specturm.
As to TouTiao Official Account, algorithm is more effective than social networking in expanding its user base. As a matter of fact, the number of registered TouTiao OA grew from 35,000 to 300,000 within one year after it was launched. Since original videos only account for 6 per cent of all the short videos uploaded every month, it is fair to compare TouTiao to “carrier” or ”scissor” of original videos.
Three most popular short videos on TouTiao Video in October 2016
Among the ten most popular videos on TouTiao, only ErGeng’s video is original. Other videos are all adaptation from overseas videos, film & TV series, internet videos.
Except for the video “Secrets Behind New Portrait of Chairman Mao on Tianan’men Square” posted by New Beijing Daily (the most popular video in September), other TouTiao accounts all hide the source of their videos.
For sure, there are even easier ways to “carry” or “copy” videos. For example, a short video intercepted from news report by Guangdong Economic and Scientific Education Station but titled “A 650-Kilogram Pig Could Understand Human Language” could enjoy over one million view times. As a matter of fact, if you search the news on TouTiao, you would find over twenty TouTiao OAs have posted the same video. Among them, the highest view times reaches 10.25 million. How is it that TouTiao’s de-replication mechanism is still not working?
Although the annual new media TouTiao awarded in 2016 are all original video producers, their videos seldom hit the Top Ten list. Take “TouTiao Annual New Media Award” winner Vice China for an example, only two videos’ view times posted this January and February reaches over 100,000, while view times of over half of its videos is less than 10,000. However, view times of a short video titled “A 650-Kilogram Pig Could Understand Human Language” often reaches ten million. This may also help explain why TouTiao stops issuing big data report over TouTiao Video since last November.
In a previous TMTpost article, the author pointed out that owing to the questionable algorithm, TouTiao finds it hard to establish loyalty among its users and sensational contents are more popular on TouTiao. To win as much audience as possible and appeal to TouTiao’s algorithm, it’s natural that most TouTiao OAs would turn to sensational videos. After all, it’s no easy thing to build up new brands and IPs on TouTiao.
Moreover, since it’s a lot easier to be a “carrier” and “scissor” of original videos and there is an inexhaustible source of such videos, these TouTiao OAs can upload a massive number of videos in a short time. That’s why the total view times of such videos could reach over one billion every day. To a degree, TouTiao and these “carriers” as well as “scissors” are mutually complementary and contributed to each other’s success.
Although TouTiao never made it clear, we can easily imagine the huge traffic it gained through these videos. By the way, high-quality original video producers such as ErGeng could only earn less than 100,000 yuan every month.
Since advertisers begin to hesitate when advertising on TouTiao, while most TouTiao OAs can’t share the ads fee, TouTiao is also facing great challenges and has to opt for change. After all, when nobody would be willing to constantly produce new original contents when they are not properly paid.
The other days, TouTiao just added a new function: Fans See. TouTiao OAs with over 10,000 fans can apply for the function, so that their videos won’t be deleted by TouTiao’s algorithm and will appear on fans’ homepage. In this case, fans number finally becomes important on TouTiao. Still, TouTiao is firmly based on algorithm, and such function won’t change this fact.
Sina Weibo walks on two legs: social networking and algorithm
While algorithm-based TouTiao can be compared as “carrier” of contents, Sina Weibo is not just a carrier. With an increase of 713 per cent as to short video view times, Sina Weibo is also an incubator of internet celebrities and a gathering platform for people interested in the same thing,
While the number of “carriers” increased rapidly on TouTiao, that increased even more rapidly on Sina Weibo. Text carriers such as “We Love Lame Jokes” and “Happy Zhang Jiang” become video carriers in the video era, let alone a large number of popular individual accounts and Blue V accounts (media).
In the era of we media, every organization has its own Sina Weibo account and Official Account and would post updates every day. However, the majority of organizations aren’t capable of producing new contents, so they end up reposting and copying others.
Moreover, Sina Weibo, similar to Instagram, has grown into a “factory of internet celebrity”. As a matter of fact, there has already emerged a product line of nurturing and promoting internet celebrities and then making profit. A well-established internet celebrity economy and ecosystem enables them to attract fans, keep them with various forms of contents, from short videos, live streaming to photos and texts. This is also why most internet celebrities on Meipai have a Sina Weibo account.
Owing to Sina Weibo’s capability in different segments, short video producers don’t need to focus on public topics like Papi Jiang. Instead, they can just focus on areas they are good at. This is something Meipai, Kuaishou and TouTiao can’t imagine.
As to the video distribution mechanism, nearly half a million Sina Weibo accounts not only serve as content carriers, but also distributors. As a matter of fact, professional short video brands such as YiTiao and ErGeng and Pear Video owe much of their success to video distributors.
Among 3 billion view times during the beta testing period of Pear Video, 1.8 billion comes from Miaopai. However, Pear Video didn’t have many fans at that time. It is content distributors such as People’s Daily and Global Times that contributed to such astronomical view times.
In another article about Zhihu and Zaihang, I explained that it was the large number of “carriers” and “copycats” that spread Zhihu’s influence from 20 million to over 100 million. In the era of short videos, “carriers” are also “distributors”, since short video producers often include their logos and ads in their videos.
Therefore, Sina Weibo has become the most mature platform for short video brand to rise into popularity.
Besides nurturing we media and helping them making profit and interact with fans, Sina Weibo is also trying to penetrate third and fourth-tier users through algorithm. Since this group of users don’t have specific interests, it’s more convenient to recommend contents to them based on the algorithm, which not only lowers the thresholds for new users, but also makes it more efficient to distribute videos.
Bilibili is steadily moving from ACG world to the mainstream
Bilibili is another platform that enters the short video market in recent years. With over 100 million active users, over 1 million UPs (users who constantly upload new videos to Bilibili), over 10,000 new videos being uploaded every day (90 per cent are original), Bilibili has gradually grown from an ACG community into a multi-culture cultural community with over 7,000 hot cultural circles. Through a wide range of encouragement mechanisms, such as Subscribe, Bullet Comments, Comments, Coin and Charge, the sharing environment on Bilibili is no less active than that on YouTube.
The channels and sub-channels Bilibili are the most nuanced compared with other Chinese short video community
However, while most YouTube videos are original, videos uploaded by most UPs are ghost videos, adapted videos or copied from other sources. Imagine the huge copyright risk out there. For example, Gu'amo, known for introducing films within a few minutes, is leading the trend on Bilibili. However, his account on YouTube has been suspended several times due to copyright infringement complaints.
Although YouTube has over 1 billion MAU, it is still not profitable. Although it learned from Netflix and Hulu and launched YouTube Red last year, it only attracted 1.5 million paid users. In other words, paid users only account for 1.5 per cent of its all registered users. Likewise, Bilibili’s attempt to attract VIP Members last October also ended up in failure. It seems that users are still not accustomed to paid service on UGC short video platforms.
In comparison, the number of paid users on Youku, Tencent, iQiyi paid users reached 30 million, 20 million and 20 million respectively in 2016. Although it’s increasingly expensive to purchase broadcasting rights of hot film and TV series, they’ve gradually received their award after all the sufferings by giving up on YouTube’s UGC model. At the same time, this means that they are destined to become supporting roles in the battle of the Chinese short video market.
Aware of YouTube’s lesson, these major Chinese video platforms all focus their attention on hot films, TV series, internet TV series, internet entertainment shows and we media channels, not short videos. By the way, Luogic Show and Rage Comic News Events’ videos don’t count as short videos.
However, rumor spread recently that Oneness Group is to turn Tudou into a UGC short video platform. Some insider explained that we could understand the move from the larger picture, Alibaba’s ambition in the entertainment sector. After all, Alibaba doesn’t expect to make profit through short video. It’s more like building up a defense line against other platforms.
At the same time, Alibaba can attract short video IPs through its mature film and TV series ecosystem. After all, it’s only a matter of time before popular short video brands such as ErGeng and Everyday Food Diary turns to films and TV series. For them, it would be a great cornerstone to produce internet TV series, or internet big films and even hit the big screen.
[The article is published and edited with authorization from the author @Zhang Yuan, please note source and hyperlink when reproduce.]
Translated by Levin Feng (Senior Translator at PAGE TO PAGE), working for TMTpost.