At the end of 2019, Tencent Video began to plan a grand transition to "Netflix + YouTube". They are all leading video websites in the United States.

According to this plan, Tencent Video will become a comprehensive video platform integrating film and television, variety shows and individual user production content in two years' time, with the number of daily active users rising from less than 100 million at present to 400 million. At the same time, to achieve a revenue scale of nearly 70 billion by 2022, profits will reach 60-7 billion.

In April 2020, this ambitious revitalization plan was sent to Tencent COO Ren Yuxin, but was unexpectedly refuted. "it probably means that it just seems to have changed the skin in terms of function. "said a Tencent person.

Ren Yuxin has repeatedly expressed the spur to the long video business internally. "he always makes the team think more about what to do in the future and what changes can be made. "said a Tencent person. Tencent video, which has been online for nine years, has made Tencent suffer a large loss.

At about the same time, in the BABA Center, 17 kilometers away from Tencent's video office, Youku was also carrying out a reform to transform into a short video and community.

A person close to the senior level of BABA Group told reporters that the group's idea for large-scale entertainment is that it can achieve a revenue scale of 100 billion yuan a year. But until 2019, BABA's digital media and entertainment business had annual revenue of 24.077 billion yuan and a loss of 15.796 billion yuan.

"anxiety visible to the naked eye. A BABA person told LatePost later. "Lao Fan (BABA, president of entertainment) directly asks everyone to go to YouTube and put 100 videos on Youku every month. "" everyone is confused. "

In the killing of the three Kingdoms, iQIYI, Inc. is in the most awkward position. In June 2020, it was reported that BABA and Tencent had approached Baidu, Inc. to acquire iQIYI, Inc., which is controlled by him, while iQIYI, Inc. 's share price soared 40 per cent before the market.

There is no war in the history of the Internet in China that spans more than a decade and spends a lot of money like today's video war, but in the end it is still a chicken feather-there is no expectation of profitability. Boundless investment also restrained them from making great innovations.

Now, they have to face more ferocious new forces. Short videos, led by Douyin and Kuaishou Technology, have overtaken long videos and instant messaging to become the longest-used apps per person in China.

We interviewed dozens of practitioners, investors, partners and users in the industry, and almost no one was able to sum up the significance of the war. The only conclusion we got was that they spent more than 100 billion yuan.

No one expects the end of the war. "the finish line won't change anything. "said Wang ran, founder and CEO of Yikai Capital. Yi Kai used to be a financial adviser to Tudou when Youku Tudou merged.

Looking back on the war, it is more of a warning: in a competition where money is the only barrier, there is no game with a single player. If no one comes after waiting for ten years, it will certainly appear in the eleventh year.

"We used to think TV stations were boring, but now we find ourselves becoming TV stations. "said a senior producer of iQIYI, Inc..

As of press time, Mango supermedia has a market capitalization of 122.2 billion yuan ($18.5 billion), surpassing iQIYI, Inc. 's $16.4 billion. The three giants of China's Internet, which spent 100 billion yuan in ten years to build three major video websites, are as competitive as a state-owned television station.

Lean on the giant

The day most of Youku Tudou's employees learned that the company was to be sold to BABA was around the official announcement in October 2015, and founder gu Yongqiang had been operating China's largest video website for nearly a decade.

The once brave and belligerent coach put "shrinking business" and "controlling costs" in the most important position. In the face of competitors throwing money crazily, Youku turned down the popular copyright and began to do self-made and cheap micro-movies and cultural variety shows.

An old Youku executive recalled to "later LatePost" that Gu rejected several executives' suggestion of using online drama as a member fee, on the grounds that "this has touched the cake of the person in charge of online drama." "

The boldness of Youku in its early years was that the team pulled a circuit directly from Nanjing and Dongguan to Beijing, built its own "cloud" and directly reduced the bandwidth cost to Tudou's 1max 3. "the above-mentioned senior officials said.

But now the boss pursues stability and health preservation: he no longer eats after noon every day; he begins to study fengshui. Several tripods are placed at the entrance of Youku, which is located on the North third Ring Road of Beijing, and more and more fengshui utensils appear in the company.

In hindsight, the boss may have decided to sell the company a long time ago. "said a Youku employee in the era of Victor Koo.

Back in 2012, when Youku acquired more than 40% of the market after merging Tudou, most people thought there would be no war in the long-term video industry.

But Baidu, Inc. bought PPS at a critical moment and pushed it to merge with iQIYI, Inc., owned by Baidu, Inc., which broke the balance of power and the new platform quickly moved closer to the first place.

Baidu, Inc. 's original expectation for iQIYI, Inc. was to narrow the gap with Youku as much as possible, but now this has become a minimum requirement. "said a middle-level person formerly known as iQIYI, Inc..

One long-term video industry investor recalled that Youku paid Baidu, Inc. 3 million yuan in cash and a 1 per cent stake in order to become his exclusive partner in video content. But in the end, Cool 6 won the support of Baidu, Inc. with 6 million yuan in cash and 3.4% of the shares.

The entry of the giant has changed the ecology originally established by startups in the long video industry, dragging the industry into an unsustainable war of attrition.

The first thing the popular online drama "Tomb robbing Notes" knocked on was Youku's door. "they charge 100 million yuan, but Youku's upper limit is 2 million yuan. A Youku person said that in the end, the show was won by iQIYI, Inc. at a cost of 5 million yuan per episode.

In early 2013, when Baidu, Inc. was in contact with PPS, the news was exposed in the media. It was started by PPTV, a top-ranked video platform that was trying to sell but didn't go well. Its success or failure depends on this, in order to disrupt the negotiations between PPS and Baidu, Inc., but also to stimulate the nerves of other players.

BABA entered the bureau at this time, and an investor close to the deal told reporters that BABA proposed to buy the company at a valuation of nearly $500m and all-stock. But PPTV hesitated because it was asked to enter the BABA system and reorganize the team, "as if it had changed from a platform to a diversion portal". The above-mentioned person said.

They prefer SUNING's plan. Although the price is lower and only buys 70% of the shares, SUNING promised the team: "you are a banner of SUNING's Internet. We don't understand. We will rely on you in the future." "it directly moved PPTV. In the end, PPTV sold himself to SUNING.

This transaction did not change the pattern of the industry, but prompted BABA to turn his attention to gu Yongqiang, who had already retreated at this time, which indirectly contributed to the establishment of today's top three pattern.

China's Internet for 20 years, the market has formed a tripod trend of BAT giants. In order to maintain their monopoly position, they are constantly expanding their business boundaries.

"it is actually a world war centered on BAT. Wang ran, founder of Yikai Capital, described the game in this way. There are two core battlefields: one is the dispute over O2O-based application scenarios, and the other is the dispute over traffic entry. Long video is the focus of the debate over traffic entry.

BABA directly offered Youku $26.60 a share, which exceeds the price of any previous deal in the video industry, an investor close to the deal told LatePost later. But the investor asked gu Yongqiang not to rush to agree, "you add an extra $1 on this basis and talk to others at the same price of $27.6 per share." "

The "other person" here is Tencent, BABA's old rival. At this time, it is planning to promote its Tencent video and one of the head video site merger, and in exchange for a certain percentage of equity.

Tencent Video, founded in 2011, has been a defensive product for a long time. "We find that users have a need to watch video, so do it first. "said a middle-level employee of the former Tencent video production and research line. Compared with Youku's more than 40 million daily active users at that time, Tencent Video only reached 10 million at the beginning of 2014.

Tencent had been in contact with iQIYI, Inc. before Youku. Gong Yu (iQIYI, Inc. CEO) is willing, he thinks very clearly, as long as he must get a Wechat traffic portal and social function rights. "but Tencent disagreed. A former long video platform executive told LatePost later.

For whether or not to hand over the video business, Tencent is also playing a game internally. When negotiating with Youku, Sun Zhonghuai, general manager of Tencent Video, flew a whole team to Hong Kong to volunteer. A person from the investment department told "later LatePost" that he issued a military writ on the spot, which, in a nutshell, would keep Tencent's market share in the top two positions within the deadline.

For Tencent, video is the exit. Sun Zhonghuai's team spent the whole evening discussing with the executives of Tencent's general office how Tencent's video could go in the future. In the end, Tencent gave up selling.

For Youku, it doesn't matter whether Tencent is willing or not. It saw BABA's urgency, turned around and said to the giant, "if you add another 1 yuan, it must be stable." "they got what they wanted. Tencent's actual offer is actually 20 per cent lower than BABA's. "said an investor close to the deal.

At this point, iQIYI, Inc., Youku and Tencent video rely on Baidu, Inc., BABA and Tencent respectively.

"you can use this sum of money as much as you want."

In 2015, Tencent's complete awakening ignited the war.

"surpass Youku to become number one in the industry. "at this time, Tencent's video has a clear goal. A middle-level Tencent video recalled that the slogan shouted by Liu Chunning, the first person in charge of Tencent video, was "overtaking around the corner". "how do you exceed it? More than who? It's never been discussed. "

After giving up the sale, Tencent video also developed targeted tactics: 1 polishing products; 2 using multiple copyrights to meet the needs of users in all aspects; 3 taking group traffic resources.

The joining of Huang Hai, then vice president of the company, played a key role. He was in charge of Tencent's mobile products, online media products and advertising platform. Because it was the mobile end of Tencent News, Huang Hai quickly won the support of Tencent News for Tencent's video, which was a super app with more than 100 million daily active users at that time.

With the determination of senior officials further clear, Tencent video gradually get rid of the label of weak business, QQ and Wechat two super App also joined the sequence for its diversion. In the outside, Tencent video also began to buy wantonly.

An era background has accelerated the rise of Tencent video: the average tariff of domestic mobile traffic is continuing to decline, until the tariff reduction reached 40% in 2015, traffic has entered an era of explosion, and broadband network has accelerated its comprehensive penetration into all economic and social fields.

In just over a year, the DAU (number of daily active users) of Tencent's video has been pulled from just 10 million at the beginning of 2014 to 50 million at the beginning of 2015, leaping to the top of the industry. By contrast, Youku's DAU grew by only about 5 million this year.

Tencent is not afraid to spend money. It had previously bought the rights to the TV series Palace 2 at a cost of 800000 yuan per episode. Then, while Youku's copyright manager was on vacation, he grabbed the copyright of the new version of "The Smiling、Proud Wanderer" by raising the price.

Tencent focuses on the introduction of overseas copyright works, including HBO American TV series. In sports content, Tencent won the NBA copyright for five years with 100 million US dollars a year. "at a fairly good price, Tencent earned back the 500 million the following year. "said a middle-level person on the head video platform.

Each home-made monitoring "alarm", as soon as competitors get new content or pre-emptive online certain content, "alarm" will immediately call the police.

"in order not to lag behind others to add new content, the working system of 24-hour shifts was implemented at that time. Tencent, an employee in charge of copyright business, told reporters that for example, for a live party on a satellite TV, the boss's minimum requirement is that each program can be seen on the website for up to five minutes after the show is over.

When Tencent competed with Youku for "Ruyi's Royal Love in the Palace" in 2016, the two sides were calm and friendly. In the face of the costume drama, which cost more than 300 million yuan to produce, they agreed to pay 600 million yuan each to win the rights to broadcast the show on both platforms.

Things soon took a turn. A person involved in the purchase said Tencent felt remorse when he went back because the team was confident that "Ruyi's Royal Love in the Palace" would become the second "Legend of Zhen Huan", which became a national viewing craze after it was broadcast in 2011. Tencent immediately made up his mind, shouting out a sky-high price of 1.3 billion yuan to seize the exclusive right.

According to internal data obtained by reporters, the two dramas "helping the Shake" and "Ruyi's Royal Love in the Palace" brought nearly 20 million members to Tencent's video in 2018.

Youku has always thought that video sites are about technology business, and it has reached the peak with this. "but Gong Yu was aware of the entertainment business very early. "said a former middle-level person of iQIYI, Inc.. In order to make up lessons, Gong Yu read nearly 400 novels and plays in three years.

A Youku source told later LatePost that iQIYI had offered tens of millions of dollars in 2014 to steal Youku's number one IP, Gao Xiaosong, and his self-made crew of the show Xiao Shuo. Just the year before, Youku and Gao Xiaosong negotiated an appearance fee of only 5 million yuan.

The giants have a large number of the best talent in the siphon industry. CCTV alone has well-known producers and directors such as Ma Dong, Zheng Wei, GE Ya, Wang Xianfeng, Jiang Bin and Wang Xiaohui, now chief content officer of iQIYI, Inc.. Later, Mou Yan, the youngest general director of CCTV, joined in, bringing her own team and a new program concept, which was later named "Qifa Shuo".

"the broadcast volume of a large number of iQIYI, Inc. 's dramas is bleak, in fact, the costs are all at the level of 100 million, but the senior management does not feel that there is much problem. "in their eyes, as long as the quality of the play is up to standard," said iQIYI, Inc., an employee in charge of copyright business. "

IQIYI, Inc. is the first platform of the three platforms to focus on self-made variety shows and self-made dramas, and the earliest strategy is to buy variety copyright model, and then carry out localization transformation. A former iQIYI, Inc. executive producer told reporters that advertisers did not buy the Internet platform at all.

One example is Darwin's first show, King of Pop, in which there are no advertisements after all the recording sessions are ready. "the program has identified six artists, and the total cost is close to 80 million. "

IQIYI, Inc. 's self-control team was in a state of shutdown for a long time. "people have been researching and developing, looking for new models, and transforming them locally. To put it bluntly, they have been painting PPT, but the films just can't be sold. "

Gong Yu did not set up any KPI for the homemade team. He promised the self-made team at that time that the first year was the research and development period, and that the first two projects did not have to be published, and it did not matter if they lost money. From the third project, the money earned from all the costs will be used as a pro rata incentive for the studio.

"A lot of decisions and budgets don't have to go through Gong Yu. The studio can basically do it if it is approved. IQIYI, Inc., a senior producer, said that unless he needs the company to advance money and Gong Yu to make decisions, he basically won't interfere with the content at other times.

"however, Gong Yu likes to participate in the R & D meetings of the program team, acting like a quiet spectator every time. "he said.

The founder of a company that worked with iQIYI, Inc. told later LatePost that iQIYI, Inc. could hand over all the processes to the production company, including marketing, production costs, actor pay and the cost of late special effects, and then give it to the production company with a budget of, say, 150 million yuan for a play.

"you can use this sum of money as much as you want. "these are the instructions he received.

In 2018, Youku left its greatest enthusiasm to fight for the right to broadcast the World Cup online. In an unprecedented three days, BABA passed a budget of nearly 1.6 billion yuan, "secretly attacked" Tencent, who asked for 1 billion, and quickly signed a framework agreement with CCTV to lock in cooperation.

After a month of hustle and bustle at the World Cup, a former Youku middle-level person told LatePost that the World Cup brought more than 30 million pure content users to Youku, and this wave of users quickly sold out after the World Cup.

"it turns out that money is almost the only barrier in this war. Under the vicious competition of BAT, Aiyou Teng has become increasingly "pipelined"-- user loyalty has become extremely low, the platform must constantly spend money on high-quality content to maintain users' stay, and the giants think they can end the war quickly.

Will

On March 29, 2018, iQIYI, Inc. landed in the US capital market. The headquarters building of major shareholder Baidu, Inc. spelled out the shape of "AI ♡ QIYI" with lights that night. Li Yanhong, founder of Baidu, Inc., chose a greenish tie to appear on the NASDAQ Stock Exchange, which is iQIYI, Inc. 's iconic color and the color of "rising" in US stocks.

When Baidu, Inc. founded iQIYI, Inc. eight years ago, he hoped it could become an independent startup: renting an office, setting up a business team, and an independent domain name for the website. Even in the early days, few employees came from Baidu, Inc.. When Ren Xuyang, then vice president of Baidu, Inc., was looking for a founder for iQIYI, Inc., the standard was also "entrepreneurial" CEO.

This does not mean that Baidu, Inc. let go completely. Baidu, Inc. 's model is that all the spin-off businesses own more than 40 per cent of the shares, while the team accounts for only 10 per cent and 20 per cent. "said a person close to Baidu, Inc..

Mr Li is in line with Mr Gong in most cases, but Mr Gong has only a 5.4 per cent stake in iQIYI, Inc..

BABA hopes to transform the online video industry in a more efficient way, but at the same time he can't avoid threats from competitors, which lead Youku to a twisting road. "A former Youku middle-level person said.

After Youku was acquired by BABA, the turnover caused by strong pressure was understood by some people as BABA's change of blood. Soon, a group of Alians from e-commerce business were arranged into Youku's technical team, data team, member team.

The old Youku pays more attention to the length of stay of the users, while the new Youku emphasizes the GMV sold by its members. "people are taught to think about how to increase the number of payers and increase the unit price of each member. "he said. But even the assessment of traffic has become more stringent than in the past. Such as variety show! In "hip-hop", the team was asked to measure whether it met the standard according to the amount of traffic reached per hour in a show.

Zhuang Zhuoran (Nantian), vice president of BABA Group, was transferred to Youku COO and BABA Grand Entertainment CTO in 2017.

"Nantian was the first to cut all the business and actions of Youku and even big entertainment. A BABA source revealed to LatePost later.

In addition to Yang Weidong, Nantian also reports directly to Zhang Yong and Zhang Jianfeng (then BABA CTO). "if you run on both sides of Hangzhou and Beijing, there will be three weekly meetings a week. "

His first fire focused on Youku's technology, which dominated the forced integration of Youku's technical architecture and BABA. The long and complex underlying technology upgrade has seriously affected Youku's user experience, the most prominent performance is the slow broadcasting speed and the stutter that drags the progress bar.

A member of Youku's product line recalled "later LatePost" that the team strongly applied for additional servers to solve these problems, otherwise the user experience would be greatly affected. The proposals were rejected one by one because it would lead to a sharp rise in costs.

Yang Weidong, then president of Youku, was a very small number of senior executives who entered the BABA system and held important positions after Youku was acquired by BABA. "BABA's will is not to spend much money, and to transform great entertainment with the mode of the Internet. A BABA entertainer said that the word "transformation" is very vague, and the implementation of "do not burn money" is much clearer.

Since then, Yang Weidong will concentrate more power-all content and procurement business needs his personal approval; content procurement needs to be submitted to the finance department in advance for review to analyze whether advertising revenue can recover the cost; all the publicity budgets in the hands of content producers are handed over to the marketing department for unified management, approval and release.

'in a content company, people who make content suddenly have no money or power, 'said an industry insider. "centralized people don't understand the content at all. "

"for a long time, the Youku team spent more energy on helping the group do the annual Singles Day party. A person from Youku P8 told Ji later LatePost.

Since 2016, Youku's high-quality content has continued to shrink, with original producers and content people leaving in large numbers, as well as a large number of director and screenwriter resources from the film and television industry. Youku's own production team has been reduced from six to three.

At the end of 2019, Youku had fewer than 30 million members, when the membership of the other two companies had leapt over 80 million.

After Tencent's 930th reform at the end of 2018, Tencent Video was included in the platform and content Enterprise Group (PCG) headed by Ren Yuxin.

What he is facing is, when the platform is losing money for a long time and Douyin Bilibili Inc. is rising, "Why don't the employees of Tencent Video have a sense of crisis?" "said a middle-level employee of Tencent video.

In Tencent video, most employees are still full of confidence. Tencent video once from lagging behind to the first experience told them, "now just need to do some small transformation, even if it is a little longer, but will eventually win." "

"you don't know what the idea of the top management is, and the OKR and target data set above will hardly be transmitted to the director. "said a Tencent employee.

At the beginning of 2020, Sun Zhonghuai, vice president of Tencent and head of Tencent video in the United States, was unable to return home because of the blockade of the epidemic. At a meeting, his daughter's playful voice was suddenly heard in the video. "the boss seems quite relaxed. Tencent, a video personage present, described how most people felt about "later LatePost".

In early 2020, Jiang Xirong, a Ph.D. from Uber, parachuted to Tencent Video as deputy general manager, responsible for data science and data decision-making related business.

A middle-level employee of Tencent video said, "in our opinion, she bears one of Ren Yuxin's expectations for Tencent's video technology reform. "

From an internal point of view, Jiang is more like a catfish. She specializes in data decision-making, solving data decision-making and data analysis, but in fact, in the original product line, Shu Jun, general manager of Tencent Video, and Wang Wei, deputy general manager in charge of business and strategic analysis, are all doing similar business.

"she will take the initiative to rob people and ask for business. "said a middle-level employee of Tencent video. "later LatePost" learned that Li Daren, vice president of Zhihu Inc. technology, has also recently joined Tencent video.

Another delicate relationship is that the core resources of Tencent's video are the contacts and content production ability of the film and television circle. 'but at the same time, you will see that Tencent Pictures is also constantly moving, which is a strong competitive relationship for Tencent Video, 'said one person for Tencent video.

Cheng Wu, chairman of Tencent Pictures, is an old subordinate trusted by Ren Yuxin, so in the ridicule of Tencent's internal staff, the film industry is closer to the top. Cheng Wu also served as Tencent animation chairman and China Literature CEO at the same time. In October 2020, Tencent Pictures released plans for the production of a number of films and TV dramas, many of which are in exclusive cooperation with iQIYI, Inc. and Youku.

At a monthly VP joint meeting after the structural reform, the person in charge of the content ecology of the information stream product Tencent Kingpin opened his mouth to Tencent video to obtain the copyright content of Tencent video variety, film and TV series. This proposal was directly rejected by Sun Zhonghuai, on the grounds that "this is the core asset of Tencent video. "

The two sides quarreled all afternoon, but Ren Yuxin did not give a clear attitude.

"who is responsible for doing something wrong?"

In the early years, when Wechat was doing the official account, the team thought about doing video content, and the team found Tencent video at the first time.

Tencent video put forward its own request: if we are to bear the bandwidth fee, we must be allowed to add sticker ads in front of the official account video. A senior product manager at Wechat recalled "later LatePost".

The official account has high-quality creators and fans with high stickiness, but the disadvantage is that the user experience of the video in the official account is poor. "if the two sides join hands to open a special area in Tencent's video and aggregate high-quality self-media video content, they may have the potential to make a Bilibili Inc.. "

"but UGC, PUGC in Tencent video has never been a preference. A former Tencent video manager told LatePost later, "it is not in terms of resource allocation, benefit distribution or team cognition." "

Aiyou Teng struggled for 10 years, and in its heyday, they almost completely squeezed startups out of the game. All these are bought with boundless investment and greatly restrain their innovation.

After 2018, Douyin, Kuaishou Technology and Bilibili Inc. rose rapidly. According to Quest mobile, the total number of short video months used in 2018 increased 1.7 times compared with the same period last year, surpassing online video to become the second largest industry after instant messaging. These new forces not only take away their users, but also gradually go deep into their hinterland.

"the long video platform is so hard that even if you break your teeth and swallow, you have to support the plate of the content on the platform, but the weather changes overnight. "said Wang ran, founder and CEO of Yikai Capital.

Cognitive change is the most difficult.

Until early 2020, a core executive of Tencent Video still questioned, "do our users really like watching the funny content of Douyin and Kuaishou Technology?" Previously, this executive has been in charge of Tencent Video, an independent short video product.

A Tencent video product technical line told "later LatePost". "Thirty (Sun Zhonghuai) said internally,'I don't quite understand this (product technology). Just give me what I need'. "

"in the eyes of long video platforms, short videos are not a matter of life and death. "A Youkulai crazy former middle-level said to the reporter.

Lailian is Youku's live broadcast team, which saw the short video product Musical.ly a long time ago and thought it was a big opportunity. The person in charge at that time was ruthless and decided to stop the live variety show and take the team to devote resources to the development of short videos for half a year. But in the end, after the team handed in the research report, the project was directly rejected by Yu Yongfu and Yang Weidong.

The inherent interest pattern has been formed and difficult to break, which also hinders the birth of innovation.

"how are traffic and resources allocated? Who will make the decision? Who will take the risk? If the current KPI cannot be completed because of new innovation, who is responsible? An employee of Youku's short video business said that the end result is that no one dares to make a decision.

When Tencent's video team handed over the "Netflix+YouTube" transformation plan to COO Ren Yuxin in April 2020, it was immediately refuted. In his view, this plan does not carry out a more thorough reform of Tencent video-the adjustment of the technical mechanism and team coordination mechanism behind it.

In the end, the team can only find a compromise and come up with an independent solution that does not affect the overall situation. "later LatePost" learned that he Yijin, general manager of Tencent's video product technology department, will lead a new "special zone" reform project. In this "special zone", all permissions such as algorithms, products, and technologies are assigned to one person, who wants to explore the possibility of Tencent's video transformation from the mechanism.

Compared with Youku and Tencent, with the decline of Baidu, Inc., iQIYI, Inc. is the most anxious.

IQIYI, Inc. CEO Gong Yu realized a long time ago that investing in high copyright costs is unsustainable, so iQIYI, Inc. is also the most frequent of the three to explore innovation. But this also determines that iQIYI, Inc. tends to do those innovations that can be realized as soon as possible, such as the first to try self-control, membership, and later to do games, animation.

In 2014, iQIYI, Inc. reintegrated the PPS team, a video website he acquired, and founded iQIYI, Inc. Games based on his Shanghai-based game team.

The management attached great importance to it, and once hoped that the game business could reach 20% of iQIYI, Inc. 's 30% income. 'but iQIYI, Inc. ignored that it takes a lot of upfront investment to build game R & D capabilities, 'said iQIYI, Inc., a middle-level manager of the game.

At that time, I heard that Shi Cangjian, former president of BABA Games, said that they would spend NT $1 billion and grasp the entire game system to build up to earn future money in three years, and everyone envied it. The above iQIYI, Inc. game personage told "later LatePost" that iQIYI, Inc. 's financial pressure led to not giving so much patience in the business of non-main waterways.

A middle-level employee of iQIYI, Inc. 's game business said that iQIYI, Inc. 's strategy is "movie and game linkage", which means that the development and launch of each game must be in line with the progress of movies and TV dramas, which obviously violates the normal product logic.

Since 2017, the cold snap has blown more and more onto Aiyouteng. Even with iQIYI, Inc. 's self-made team, it's hard for them to be as relaxed as they used to be. They received an instruction: in the future, no matter how good the project can be started, if the customer and sponsor cannot be identified in advance.

"at that time, there was a studio and there was no project to start for a whole year. "said an executive producer of iQIYI, Inc..

"when you are already in a long video war, your income comes from advertising, from members, and they are all driven by big content, and you can only continue to invest in this story. One observer said that for big companies, the game is hard to stop at the beginning. "

There is no end.

In June 2020, when Tencent was discussing becoming iQIYI, Inc. 's largest shareholder, iQIYI, Inc. 's share price soared 40 per cent before trading, according to Reuters. The market is optimistic that once the deal goes through, China's two largest video websites will achieve absolute control over the industry.

"later LatePost" learned that just before Tencent approached iQIYI, Inc., BABA had already found iQIYI, Inc.. Over the past year, negotiations between several competitors have become frequent.

By 2020, the video war between iQIYI, Inc., Youku and Tencent has entered its tenth year.

"No shareholder will allow a business to lose 10 years or more, but it persists because of the existence of BAT. "Wang ran said.

Video website has two meanings, one is important traffic entrance, the other is content economy and influence economy. A senior BABA official said that entertainment is a slow job, which requires determination and persistence, so only tycoons can play.

No one wants to take a step back, not even BABA, who is farthest from the entertainment industry.

"after all, if there is a big outbreak of entertainment cash one day, and this position has no layout at all, who will be held responsible? A middle-level employee of Youku told LatePost later that Youku is now more in the card, and one day he will become the second when he can't tell iQIYI, Inc. 's money and story.

During BABA's two-year turbulent integration period in 16-17, the usage time of Youku users continued to decline, while DAU remained at around 50 million. "even though I did so badly, I still didn't lose it. It's good from the point of view of ROI. "

Managers of Tencent Video today have to accept inquiries from Tencent COO and platform and content Enterprise Group (PCG) Ren Yuxin every month or even every half month.

"later LatePost" learned that Tencent Video has three key points in the latest transformation reform: Tencent Video will no longer be divided by channel, but will recommend PGC, PUGC and UGC content according to personalization; build an ecosystem of creator accounts with short video user penetration exceeding 80%; and slowly accumulate super IP in the core long video field.

"the focus of Mark (Ren Yuxin) now is, first, to build Tencent's content business into 'Walt Disney Company'; second, to let the Taiwan-based and technological transformation of PCG achieve results. "said a Tencent person.

But reform cannot be achieved overnight.

A Tencent video source told "later LatePost" that the team had previously reported that it would support about 1000 Wanfan accounts. Ren Yuxin directly rejected this quantitative indicator when he saw it. "he thinks Tencent video does not need to pursue KPI now, but want to do basic thing first. "

Starting in 2019, Fan Luyuan also opened a new round of personnel stocktaking at Youku. He came to Youku on the morning of his first day in office and was extremely angry when he found his office empty. The next day, he adjusted the working hours of the whole staff to 09:30.

Managers at and above the P9 level have started their work one after another. With the end of this round of stocktaking in June 2019, more than 30% of staff were laid off in many departments-many of them P6 over 30 and P7 over 35.

"after Lao Fan came, Youku made more overall data indicators a higher level of confidentiality. A Youku product manager said one of his considerations was to prevent Youku's flagging data performance from affecting morale.

IQIYI, Inc. was the first of the three to respond to the change. In 2020, iQIYI, Inc. launched a short video and promoted it as an important current strategy; in the second quarter, iQIYI, Inc. launched the Misty Theater, which is dominated by suspense skits; and launched "Star Diamond members" to further explore ways to increase membership fees.

Gong Yu used to predict internally when he would make a profit, but now he basically doesn't mention it. "said an iQIYI, Inc. person.

In May 2020, the media exposed that iQIYI, Inc. was going to lay off 20% of his staff. VR and Bubbles, which were not on the main track, were the hardest hit areas. Subsequently, iQIYI, Inc. responded that the news was not true. But the company did do more optimization this year than in previous years, these people said.

"Tencent video and iQIYI, Inc. merger, the industry will have fundamental changes, Tencent to achieve a dominant, content costs can also fall rapidly. "one private equity investor said

But competition can never be eliminated by merger. What you can see today is that Station B will continue to grow, the byte beat may also rush into the battlefield with money, and the flames of war will be reignited.

BABA discussed a possible equity deal with Bilibili founder Chen Rui in early 2020. Bilibili Inc. is regarded by the market as the emerging Internet community closest to YouTube in China.

The deal for Bilibili Inc. under discussion was valued at about $10 billion, while Bilibili Inc. 's actual market capitalization was about $6.5 billion, a person familiar with the matter told LatePost later. A year later, Bilibili Inc. 's market capitalization has exceeded 22 billion US dollars, surpassing iQIYI, Inc. 's 16.6 billion US dollars.

"pessimistic point, even if Tencent and iQIYI, Inc. merge, the video war still cannot end. "after all, everyone is too rich," said one investor.