The bubble of Mobile Live Video Broadcasting looms. Capital burns money to rob people and makes it difficult to make profits

the fierce market competition contains huge economic benefits. Investors generally believe that the mobile live broadcast industry will give birth to 10 billion yuan-level companies, with the entry of Internet giants such as Tencent and 360, the "hundred Regiments War" of the live broadcast industry has officially begun.

from 7: 00 to 9: 00 every evening, it is the broadcast time of Shen Man (a pseudonym). Before the broadcast, she would put several plush toys directly opposite the computer to decorate the relatively humble room. Shen is a graduate student at a university in Guangzhou. after finishing his daytime courses, Shen became an online anchor at night, performing in front of fans.

since signing up for a live broadcast platform, Shen Man needs to set aside two hours every night to complete the live broadcast task. As long as she is online for 20 days in a month, she can get a signing fee of 4000 yuan to 5000 yuan for the platform. And she can also share the commission income from the "gifts" given by fans.

the situation of Shen Man is not an isolated case, but the norm in the domestic live broadcast industry. In order to attract more users to enhance stickiness, in addition to signing up entertainment stars or game anchors at sky-high prices, live streaming platforms are increasingly inclined to sign up for online celebrities, including female college students or urban white-collar workers. Compared with the starting price of millions of yuan, the signing fee ranging from 4000 to 5000 yuan is not high, which makes many live platforms compete frantically for anchors' resources in colleges and universities.

through various investigations, the reporter found that the rising value of anchors is due to the continuous flow of blood transfusions for the market by a large number of VC. From the first year of live broadcast in 2015 to the Red Sea in 2016, mobile live broadcast has replaced the chauffeured car and O2O market and become the most high-profile mobile Internet project in just one year. Post-90s users have generally developed the habit of paying for content, which brings certainty to the profit model of mobile live streaming, but only by spending money to grab high-quality IP content, it is difficult for the live broadcast platform to completely win market share and escape from the trap of losses.

in addition to spending money to compete for anchors' resources, the heavy bandwidth cost is also one of the factors that make it difficult for mobile platforms to make profits. For a platform with more than one million online users at the same time, it needs to spend tens of millions of yuan in bandwidth fees every month, which means that the annual fixed cost is at least 100 million yuan.

strong > "hundred Broadcasting Wars" / strong >

how popular is Mobile Live? According to the 2016 Special study of China's online Live Industry released by Ai Media Consulting, there were nearly 200 online live broadcast platforms in China in 2015, of which the market size of webcast was about 9 billion yuan, and the number of users of webcast platforms has reached 200 million. Large-scale live streaming platforms have nearly 4 million people online at the same time during peak hours every day, and more than 3000 rooms are live at the same time. Among them, the live broadcast of entertainment content accounted for 50.2%.

from YY and 9185 in the early PC era, to the rise of Douyu and Zhanqi, the domestic live broadcast industry ushered in the "hundred Regiments War" in the early years of group buying and O2O. In addition to the widespread live broadcast of entertainment and games, the growth rate of live broadcasts such as finance and economics and grassroots is also quite alarming.

the capital side behind this is also complex. There are not only Internet giants entering the venue, but also many VC are optimistic about live streaming. At present, 50 institutions have participated in investment in hundreds of live broadcast platforms. For example, IDG has invested in the famous show platform 9158, and then invested in bilibili, Fengyun Live, Octopus TV, ULOOK.TV, etc.; others, such as Sequoia, Junlian, Tongchuangwei, Songhe Capital, Innovation works, QiMing Venture Partners, CA, Plateau Capital and so on.

take Yingke, which currently ranks first in the social field of mobile video in China, as an example, because it has accumulated more than 3 million registered users and more than 60, 000 active anchors in half a year, the amount and speed of financing far exceeds that of chauffeured cars and O2O. In the past three months, Yingke first received round An investment from Saifu, Jinshajiang and Zihui, and then Kunlun Wanwei participated in its round B financing of 68 million yuan, with a valuation of 370 million yuan.

Zhu Xiaohu, founder of Jinshajiang, who participated in Yingke's round An investment, recalled that the 17 live broadcasts invested by Wang Sicong suddenly became popular last October, causing him to reflect on whether he was missing the big tuyere of Mobile Live. So after meeting with all the mobile live broadcast teams in China within two weeks, Zhu Xiaohu finally chose Yingke. "the live track can give birth to a $10 billion company, which is based on the YY,YY valuation of $3 billion when PC was on the Internet, and the semi-PGC; mobile live broadcast platform faces a wider range of users with a market capitalization of $10 billion."

Gu Feng, founder of YY Game Live, wrote that Yingke is younger, more mobile, richer and fragmented than YY Live. "the mobile movement of traditional shows is too slow, their advantages and user base are on PC, but the young users on the mobile side have not been well covered. Once the PC show cannot put down its posture, leave its historical burden and forget its existing advantages, it will give Yingke a good opportunity to take over the young users of the show on the mobile end, become the representative of the live broadcast of the mobile show, and will gradually erode the original market of the PC show in the future, which is a wake-up call for the PC show. "

strong > Burning money and robbing people / strong >

the only LVB platform that has been listed now is the interaction between Happy gathering Times and Sky Pigeon. In the era of PC, they have always been representatives of making a fortune in silence. According to the financial report, net revenue in the fourth quarter of last year reached 1.8998 billion yuan, up 62.3% from 1.1706 billion yuan in the same period last year, with a net profit of 359.2 million yuan. Last year, Sky Pigeon Interactive had a total revenue of 678 million yuan, a gross profit of 526 million yuan and a gross profit margin of 84.8%.

after entering the era of mobile Internet, Mobile LVB has the opportunity to overtake around the corner. Similar to the competition of video websites in that year, the core competitiveness of mobile LVB platforms lies in content copyright and traffic. At present, most LVB platforms compete for high-quality IP to attract users. The disadvantage of this model is that in the initial stage, platform income is difficult to cover expenditure costs, investors have to continue blood transfusions for major mobile platforms, until the industry enters the reshuffle stage, leaving four or five major platforms.

2015 is the first year of mobile live streaming. In 2016, the industry has entered the Red Sea, and major live streaming platforms have begun to become new entrances for BAT and other Internet giants. At present, Tencent has successively invested in Douyu and Zhanqi, and has also launched its own live broadcast platform; Huya belongs to the era of happy gathering; Panda TV is founded by Wang Sicong, Huajiao TV belongs to the 360th camp, while Black Gold Live belongs to Xiaomi, coupled with NetEase BoBo, Momo Live and other products, the industry has spread all over the giants.

in the face of the attack of all kinds of mobile live broadcasts, the industry boss decided to fight back with a lot of money. First, he announced that he would invest 1 billion yuan to launch "Zhiniu Finance", which focuses on financial live streaming. At the same time, his mobile live broadcast platform Huya also signed e-sports to explain the anchor Miss at a sky-high price of 100 million yuan in three years, coupled with the signing of a large number of entertainment stars, the investment of the happy gathering era can be said to be regardless of cost.

in addition to the high VJ signing fee, the LVB platform also has to pay bandwidth, storage and other costs. Take Huanju as an example. Last year, when CFO he Zhenyu announced an investment of 700 million yuan in Huya TV, he Zhenyu said that the budget for bandwidth investment was 260 million yuan, the sponsorship fee would be about 200 million yuan, and the market promotion was expected to invest 100 million yuan. According to the financial report, the bandwidth cost in the fourth quarter alone was 161.1 million yuan, up from 117.8 million yuan in the same period last year.

unlike the situation abroad, the cost of domestic bandwidth is still very high, even higher than the investment of contracted VJs. According to industry insiders, with the lowest bitrate of 800K and assuming 1 million users online at the same time on the live broadcast platform, the monthly bandwidth cost will be as high as 30 million yuan or more. What's more, game live streaming needs high resolution and higher requirements for broadband, which means that most game live streaming platforms are still burning money to make money.

strong > Cash mode to be tested / strong >

the biggest problem facing Mobile LVB is the homogenization of content. It is obvious that the number of users can be driven by the influence of online celebrities, but once the novelty is over, it is difficult for the mobile platform to retain users. Coupled with the regulatory problems still exist, the live broadcast platform also faces policy risks. In mid-April, the Ministry of Culture announced that Douyu, Huya TV, YY and other live broadcast platforms were included in the investigation list on suspicion of providing Internet cultural products that promote obscenity, violence, crime, and other content.

in addition, the content of the mobile live broadcast platform is no longer limited to beautiful anchors and game commentators, but blossoms in many ways, which has a lot to do with the changes in the entertainment style of young people. But the biggest problem is that the vast majority of mobile live streaming users stay in second-and third-tier cities, making it difficult to enter the market in first-tier cities.

"our typical customers are in two categories, of which about 90% are low-income groups in third-and fourth-tier cities, that is, the so-called 'losers'; the other 10% are small bosses of some middle-and high-income groups, such as coal bosses, contractors, and so on." Fu Zhengjun, chairman of 9158 parent company Sky Pigeon Interactive, said that they have also made some explorations for white-collar workers, but so far they have not been very successful.

refer to the current profit model of the happy gathering era, the revenue mainly comes from members' fees and games, of which the former accounts for the vast majority. The profit model of Sky Pigeon Interactive is also very similar, but Fu Zhengjun hopes to launch corresponding services for existing regular users, such as P2P and medical services.

Yang Yi, founder of Zhijinhui, is one of the investors in easy Live. She believes that a wide range of video applications, including online shopping, buying a house, sports, education, e-commerce, social networking, art and so on, will be application scenarios in the live broadcast industry. and it may even replace Wechat to become a super platform. "I believe that in the future, 80 per cent of user behavior will be implemented on the live streaming platform, and everyone will be able to use live streaming just like Wechat.

Edit: vian