Edited from Oriental Securities:"continue to build a comprehensive media and entertainment group driven by scientific and technological innovation"
Oriental Securities insists that the streaming video industry is a high-growth and prosperous small molecule industry in the media Internet. IQIYI, Inc., as the main provider of video entertainment in China, is accompanied by the expansion of product matrix and business scope. with the improvement of monetization ability, a media entertainment group driven by scientific and technological innovation is under construction. Among them, iQIYI, Inc. 's self-control ability is worth mentioning.
1. IQIYI, Inc. 's financial and operating conditions.
IQIYI, Inc. 's subsidiaries include iQIYI, Inc. Pictures, Shanghai iQIYI, Inc. Culture Media, Beijing Qiyi Century Science and Technology, Shanghai Zhongyuan Network, etc. Its main business includes computer software, distribution of cartoons, advertising and so on.
Financial data
The study of Oriental Securities found that iQIYI, Inc. 's income mainly comes from: 1)Member serviceVIP members can watch paid content, turn off ads, watch higher definition videos, and have more privileges in iQIYI, Inc. Bubble; 2)Online advertisingMost advertising services are in the form of brand advertising, and native information flow advertising (advertising internalization) has been launched since the fourth quarter of 2016; 3)Content distribution; 4)Other: live broadcast, game distribution, IP and so on.
And in terms of costs and expenses,Content cost and bandwidth cost are the most important components.Among them, the increase of content cost mainly comes from the increase of copyright content cost and content sharing cost.
Core operational data
The number of paid members of the company is growing rapidly.
The growth rate of DAU and MAU of mobile phone users has slowed, but the number of daily viewing hours has continued to grow.
2. IQIYI, Inc. 's advantage of self-control.
Oriental Securities believes that from the composition of the content cost increment above, we can see that at presentThe proportion of iQIYI, Inc. 's original content is still small.Copyright content is still mainstream, but the company beganIncrease investment in original homemade contentIt is expected that the net asset value of original content and cash investment in original content will maintain rapid growth in the future.
At the same time, iQIYI, Inc. 's future purchase of copyright content is still huge, with a commitment to pay more than 16.5 billion yuan for copyright content.
In terms of self-made content, Oriental Securities will be divided into two dimensions: variety shows and online dramas according to the production process and content characteristics.
Variety self-control
Oriental Securities believes that in terms of variety content, iQIYI, Inc. mainly has the following advantages: 1) the company continues to introduce excellent variety producers and directors to improve the self-made variety team. 2) the studio system reform further releases the productive forces.
Self-made series
IQIYI, Inc. 's homemade drama is mainly responsible for by two major departments: iQIYI, Inc. self-made drama development center and iQIYI, Inc. Qixing Drama Studio, the former focusing on the cooperation and development of modern dramas, while the latter is biased towards costume dramas.
Oriental Securities believes that in the series, iQIYI, Inc. cooperates with the outside world to ensure the continuous supply of high-quality online dramas. Due to the long production cycle and slow turnover of the series, the self-made drama mainly adopts the outsourcing mode and cooperates with the upstream producers.
Generally speaking, Oriental Securities believes that the advantages of iQIYI, Inc. 's self-control ability are as follows: 1) A self-control team with its own system, skillful running-in and relatively stable self-control team has been formed, and excellent producers and directors have been joined constantly. Its industry resources, contacts and experience make iQIYI, Inc. 's self-control ability improve rapidly. 2) the studio model ensures an effective incentive mechanism, and forms a complete supporting system to improve efficiency, release production capacity, encourage innovation and dare to try and make mistakes; 3) through the advantage of platform resources, the production company at the head of the external cooperation market, form a good partner ecology.
3. Risk hint
Competition in the industry has intensified, industry supervision has become stricter, and the cost of copyright has increased significantly.
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