Giant companies have entered Internet TV one after another, grabbing customers for cabbage prices while looking for a profitable road

Recently, Apple, LeTV, Ali and other companies were reported to be bidding for VIZIO, the largest smart TV manufacturer in the United States. Although LeTV has issued an announcement denying it, industry insiders believe that as TV becomes an Internet terminal, Internet TV will be used in smartphones. Mobile phones have since become the target of Internet companies trying to subvert them.

Original title: Giants have entered Internet TV while robbing customers for cabbage prices while looking for ways to make money.

Recently, news has been reported that Apple, LeTV, Alibaba and other companies have bid for VIZIO, the largest smart TV manufacturer in the United States. Although LeTV has issued an announcement denying it, However, industry insiders believe that as TV becomes an Internet terminal, Internet TV will become the target of Internet companies 'attempt to subvert after smartphones.

Data shows that in the first half of this year, the retail share of China's Internet TV brands in the TV market was 16%, an increase of 7.9 percentage points from last year. The leapfrog era of large Internet screens in family living rooms is coming. However, what is embarrassing is that while industry giants are attacking cities and seizing territory while expressing optimism about the prospects of the industry, a crucial proposition for companies is still facing these Internet TV companies-how to make money?

As Internet TV is increasingly entering users 'homes and becoming an increasingly popular Internet terminal, the reporter recently conducted an interview and survey on this industry in order to more comprehensively reflect the current development status and problems faced by the industry.

At present, the Internet TV ecosystem is showing three powerful models. One is the LeEco model, the other is the model of traditional home appliance companies such as Hisense and Skyworth, and the other is the ultra-dimensional ecological model of Oriental Pearl and Zhaochi. Wen Lan, an analyst in China's home appliance industry, said in an interview with reporters that the commercial nature of Internet TV that is flocking to the city has not changed as in the era of CRT TV. In the next two years, it will also experience market competition with one against ten people, and ultimately leave behind a few brands through shuffling.

Internet TV cabbage price attracts customers

At present, the price of a 40-inch Internet TV has already fallen below the price of a mid-range smartphone.

The reporter learned from online and offline channels such as Gome and JD Mall that the price of a 43-inch 4K popular color TV is only 1899 yuan, and the price of a 4K Kanshang color TV of the same size is only 1999 yuan, while the new Xiaomi 3S TV is as low as 1799 yuan. A shopping guide told reporters that many TVs in the 43-inch range range cost less than 2000 yuan, and young people buy more because these TVs are cheaper than smartphones, and some also provide member experience services,"for consumers. It's great value for people."

The reporter learned that the average price of similar 65-inch 4K curved TVs on the market is currently about 20,000 yuan. The price of Xiaomi TVs of the same size has already cut them in half, and the selling price is as low as 8999 yuan. In addition, Micro Whale TV and Tmall have cooperated to launch a flagship 55-inch TV that sells for only 4198 yuan (with a 12-month content package). LeTV's 55-inch Super 4X55 TV sells for 3599 yuan. The first package price of the popular ultra-dimensional TV 65-inch G65Y is 3999 yuan.

Looking back on the development of Internet TV brands in recent years, the low-price strategy can only be regarded as the first step in attacking the city. Today, Internet TV brands have long gotten rid of barbaric and extensive mutual bidding and directly entered the era of "free".

LeEco was the first to implement the "buy members to give hardware" model. This model successfully enabled LeEco's TV business to create a new sales peak of 467,000 super TVs and total LeEco member revenue of 1.015 billion yuan. Subsequently, major Internet companies rushed to join the battle.

Liu Yaoping, CEO of Storm TV, said,"The 40 X-Men version of the 40-inch TV sells for less than 1,000 yuan. As user value continues to increase, the hardware can be given away for free." The shopping guide told reporters that some consumers are still in a state of not knowing much about Internet TV, but through comparison with stores, they can be seen and touched. This model is cost-effective and naturally acceptable.

The

survey of the "2015 Blue Book on the Development of Internet TV in China" added more than a dozen new brands in one year shows that with the help of the development of Internet TV, the living room economy has regained its vitality and vitality.

Under this important opportunity period, more new brands have joined. According to incomplete statistics, the number of Internet TV brands increased by more than ten in 2015, and the overall number of Internet TV brands has become the same as that of traditional TV brands, with nearly 20.

Most new brands are born with the "golden key" in them. In July last year, the smart TV of Suning's video website PPTV made its debut; in the same month, Stormwind Technology announced that it had established a joint venture with Rishun, Aofei Animation, and Sannuo Digital Audio and Video, and would also enter Internet TV; in August, media tycoon, Chinese Culture Fund leader Li Ruigang released "Micro Whale TV" and won shares from Alibaba and Tencent; In October, Fengxing. com joined forces with Oriental Pearl, Zhaochi, Haier and Gome to announce that it would enter the Internet TV industry through equity bundling.

Recently, in the hit "New Songs of China," some careful netizens discovered that in the second episode, the light box Logo of Micro Whale TV and some TV pictures were erased.

Industry analysts believe that whether it is in terms of exposure or discussion among netizens, the performance of the micro-whale has greatly stolen the limelight of the main naming company, and the main naming company's 400 million yuan naming fee is an important mission of improving brand value. Expectations cannot be discounted by the high exposure of the micro-whale.

As a young brand, Weijing boldly bet on the phenomenal IP "New Songs of China", which undoubtedly ignited the competition for Internet TV brands in 2016.

Obviously, with the addition of new brands, the competition for Internet TV will become even more fierce in 2016. As Feng Xin of Stormwind Technology said, the competition for Internet TV brands has just begun.

It is difficult to make money for content

. Judging from the current domestic Internet TV industry, there are two models that have been widely recognized by the market. One is the traditional home appliance model represented by Hisense, TCL, Skyworth, etc., which only produces hardware and does not produce content; The second is a model represented by Le and covers all aspects from hardware to content to after-sales.

The third type of popular TV that wants to challenge the first two models is building its ultra-dimensional ecological model, bundling five leading companies together with an original dual-tier equity structure. In addition to popularity, Zhaochi is responsible for hardware, Oriental Pearl is responsible for content, and Gome and Haier are responsible for store sales.

But no matter which model, these Internet TV companies have difficulty making money. Typical Internet TVs of Xiaomi and LeTV are losing money on hardware, and the content did not see the dawn of profit last time. Zhaochi shares, which are currently in the process of issuing additional shares, have long been set at more than 12 yuan, but their share price as of July 24 is only more than 8 yuan, which also shows that the capital market is not optimistic about the popular TV it dominates.

In fact, fierce competition also stems from market saturation. According to data, global color TV shipments in 2015 were 230 million units, a year-on-year decrease of 2.5%. China has become the world's major region for color TV production and sales, and its growth rate has slowed down. In 2015, the retail volume of China's color TV market was 46.74 million units, a year-on-year increase of 4.8%, and the retail volume was 157.2 billion yuan, a year-on-year increase of 7.5%.

In addition, experts predict that starting from 2016, the future market will enter a long-term stock market competition. Therefore, the low-price strategy of Internet TV will make the competition in the TV market without incremental growth more fierce, and the original pattern will inevitably be broken and reshuffled.

Wen Lan believes that the above three Internet TV models all have their advantages and disadvantages, but the differences will become smaller and smaller as the industry advances. The current model of Internet TV is simply to jointly create an ecosystem, and the other is to create an ecosystem. The traditional model of cooperation between TV companies and Internet companies is the so-called "+ Internet", which is the only way for each to get what they need.

Traditional companies embrace the Internet to gain not only the benefits of connected content and value-added services, but a new TV ecosystem. In April this year, Hisense reached strategic cooperation with China Digital TV, ICNTV, iQiyi, and Tencent Video. Skyworth and Konka are also making similar cooperation. Konka has also deeply integrated Tencent Video's rich video resources, games, and music., giving Konka the ability to provide content and value-added services.

In Wen Lan's view, Internet brands such as Xiaomi and LeTV, which were born under the Internet gene, have advantages in content and brand marketing that traditional TV brands cannot match. However, domestic traditional TV brands led by Hisense, TCL, and Skyworth are still the first camp. The advantages of technology and brand are insurmountable by the former in the short term. These advantages are more prominent in international markets such as Europe and the United States.

Data shows that in the first half of 2016, the retail market share of domestic traditional brands was 75%, and the share of each brand was relatively uniform.

Wen Lan believes that with the stabilization of the domestic video website landscape and the end of the alliance and bundling of Internet TV licensees, content supply will tend to be homogeneous within two to three years, and the content competition gap between new and old brands will be shortened. In other words, content being king is only the first stage for TV brands with Internet genes to seize the market.

"After all, unlike the smartphone market, the frequency of TV updates is relatively low, and the dividend period is not obvious. Moreover, although China's color TV market has risen, it has become saturated. There are more than 20 content-based Internet brands in revitalizing existing markets. To compete together, it is the mission of all brands to seize the incremental market." Wen Lan believes that low-cost Internet TV brands are putting China's color TV market into an embarrassing situation of "increasing but not increasing income." Compared with brands with core technologies, these Internet TV brands lack a solid foundation for development.

Dong Min revealed that in March this year, Aowei Cloud and Tencent conducted a survey on the factors consumers consider when purchasing TVs. The results show that up to 36% of consumers pay attention to trends;21% pay attention to appearance; and only 19% pay attention to price. When consumers go to stores to make purchases, 73% of consumers plan to spend 2000 to 9000 yuan. Among them, most of them are in the range of 5000 to 7000 yuan.

"This shows that price has become a non-determinant. But in fact, the results of retail monitoring are quite different. 80% of sales are concentrated below 5000 yuan." Dong Min believes that the current low price, whether it is over-the-counter fund subsidies or real money, is deceptive and has not achieved its contribution to the industrial chain.

The elimination battle against ten is about

to begin. The industry believes that Internet TV brands, as rookies, have a relatively large growth rate. However, if we rely solely on online channels and low prices, it will definitely not be long-term. Market competition will be under great pressure, growth will slow down, and shortcomings will also be reflected.

Wen Lan, who has just returned from an inspection tour of the top ten home appliance stores in Europe, told reporters that European and American consumers are more mature and cannot gain market with low prices and concepts. "A European Cup is slowly making Hisense and TCL two black electricity giants, incomparable. The European region has just begun to understand China's home appliance brands. At this point, Internet TV brands still have a long way to go." Wen Lan said that the international market is not the touchstone for marketing concepts to capture global consumers. What consumers need is trust, brand and quality. Internationalization is the path that TV brands must take, because China market is saturated and they must focus on a broader incremental market.

Therefore, for Internet TV brands, mergers and acquisitions have become the best strategy to quickly occupy overseas markets. VIZIO was previously rumored to be acquired soon, and potential acquirers include Internet giants such as Google and Apple. Although LeEco denies it, the acquisition of VIZIO is in line with LeEco's latest strategy. Liang Jun, president of LeEco Zhixin, also revealed that LeETV will enter overseas markets this year, especially the North American market dominated by the United States.

The reason why VIZIO has attracted the attention of so many Internet giants is because it is the largest smart TV manufacturer in the United States. Since 2007, VIZIO has been at the forefront of the North American TV market share, comparable to Samsung TV.

Both LeTV and Xiaomi are currently losing money on TV hardware. In terms of content, it may be due to the large number of people entering the game and development confusion due to reasons such as content homogenization and technology homogenization. In fact, without a base of more than 5 million active users, making profits from content and services is just empty talk.

With the influx of new brands, the market competition of one against ten is no less than the era of traditional black-and-white TV competition. At that time, every province had a TV brand, including Panda in Nanjing, Feiyue in Shanghai, Taishan in Shandong, and hundreds of TV factories such as Lily, Sika Deer, Shenyang, Jinxing, and Jinfeng. Today, the 80-year-old Panda TV has joined the ultra-dimensional ecosystem jointly created by Oriental Pearl, Zhaochi, Fengxing and Haier.

According to data, currently, the market share of the top six TV brands, Skyworth, Hisense, TCL, Changhong, Konka and Haier, accounts for 75% of the China TV market, and each brand's share is relatively uniform. However, with the marriage between TCL and LeTV, sales of both may be directly increased. "In 2016, the share of traditional TV brands will be further squeezed, and it cannot be ruled out that an alliance similar to TCL LeTV will emerge." Liu Chuang, vice president of Aowei Cloud Network (AVC), believes that due to the impact of emerging Internet brands, the domestic color TV market is preparing for changes.

Dong Min also believes that "the reshuffle of the brand landscape this year will be a high probability event. Skyworth and Hisense will remain strong, and small second-tier brands may give up resistance and leave the market decently. In the future, the large-scale growth of the color TV market is dividing into competitive growth."

Recently, the "Market Inventory and Trend Forecast of China's Color TV Industry in the First Half of 2016" pointed out that China's color TV market in the first half of 2016 is falling into an embarrassing situation of increasing income. The report shows that in the first half of 2016, the retail sales of color TV markets in China reached 23.51 million units, achieving a growth of 6.9%, but the overall industry retail sales were 71 billion yuan, a year-on-year decrease of 4.0%.

Regarding the situation of increasing income, home appliance analyst Wu Zhuo said that it is the low price of Internet TV and the rapid development of e-commerce channels that have lowered the market price of the color TV industry and led to a decline in overall revenue. However, like the current smartphone market, this situation will not stagnate. As new brands and allies continue to pour in, the brand landscape will undergo subtle changes in 2016.

Wang Chuan, co-founder of Xiaomi Technology, also said that new brands will join the TV camp within two years, but TV brands will also withdraw.

Obviously, 2016 will be a critical year in determining who will be out. How far can emerging TV brands that have endowed the Internet with genes go? Will they follow the old path of the CRT TV era? The market will explain everything.

Editor: yvette