LETV's new deal did not catch users
Who is still watching the drama on LeTV?
Text: "Chinese Entrepreneur" reporter Tao Tao
Editor|Li Wei
Header image source: Attempt library
Many people have been curious about how LeEco has survived to this day.
According to the third quarterly report of LeTV in 2023, LeTV's current debt is as high as 20.93 billion yuan. Jia Yueting, who has been shouting for 6 and a half years"Return to China next week", has not yet appeared,10LETV, which had tasted the highlight in the long video track 10 years ago,After undergoing radical diversification and expansion,It has been in debt crisis for 7 years。
The debt hanging over its head is the past that LeEco must face. Since the debt has been high, part of the vitality of LETV is of course inseparable from the old assets of the Jia Yueting era - "The Legend of Zhen Huan", "Happiness is Like a Flower", "The Promotion of the Crown Princess", "The Biography of Miyue" and other quality content.
But today, if you want to continue to live, you can't rely on eating your old book. Facing the future, LETV can only break the kettle. Recently, LeEco wants to make a dojo in a "snail shell".
LETV video is the most important core product of LETV,Including website、APP,And M station;Le Rong Zhixin is separated from LETV video,Le Rong Zhixin's main products are related to LETV TV。 Le Rong Zhixin was released from LeTV at the end of 2018 and the beginning of 2019, but LeTV still holds shares of Le Rong Zhixin and is a shareholder of Le Rong Zhixin, and the two are also related parties.
Recently, LETV wants to make a drastic reform in LETV video. But the head of the long video company has the financial advantage、Professional talent reserves,LETV doesn't have it,LETV chooses to find another way——2023At the end of December,LETV released an account-sharing model that benefits the producer,Hoping to attract content providers to settle in,So as to drive LETV video users to attract new users,At the same time, it brings value-added services to old members,Broaden platform traffic。
Specifically, before January 1, 2026, after deducting the necessary expenses, all the proceeds of the content stationed on the LETV open platform will be returned to the content provider, and the account sharing ratio is 100%. In addition, unlike the head video platform, LETV also gives full autonomy to content producers in terms of scheduling and pricing.
"At present, the core of LETV's open platform is to embrace all rivers, not to seek differentiated competitive advantages, but to live. When asked about the focus and characteristics of the new content of LETV video in 2024, Zhang Wei, CEO of Lerong Zhixin, replied to reporters, including "Chinese Entrepreneur".
LeTV's new policy seems to liberate the producer from the long-lost "unequal treaty" of the head platform. However, for LeTV, which is burdened with heavy burdens, whether the measure of profit diversion will cause losses due to the increase in operating expenses will be the foundation of the success of this measure.
In this regard,LETV responded,Compared with the head video company,Only a fraction of the operating cost,It is LETV100% concession to the filmmaker:"The sum of the current operating personnel of LETV and Le Rong Zhixin is only about 400 people,Of which LETV video is only 200 people,About one-tenth of the head platform。 ”
However, under the lack of copyright resources and the limited user base, the effectiveness of LETV's video concession measures still needs to be verified.
Life is not only based on "The Legend of Zhen Huan"
LeTV once responded that "The Legend of Zhen Huan" accounted for less than 5% of LeTV's revenue, and with Le Rong Zhixin, the proportion was only 2%.
"Thinking about huge debts every day, I can't live my life. The money won't be back for a while. Optimist Zhang Wei revealed, "What we have to do is to operate well and let LeEco maintain a positive cash flow." I hope that creditors will still find us, and that LeEco will still be able to provide a stable job for its existing employees. ”
In the development strategy of LETV, in order not to repeat the mistakes of the Jia Yueting era, the current copyright purchase policy of LETV lies in "small and fine".
As of the third quarter of 2023, among the major video platforms, iQiyi, Tencent Video, and Mango TV have achieved profitability. Among them, Mango TV, which is the first to make a profit, is backed by Hunan Satellite TV, and the copyright transaction fee is less than half of that of the others. Youku Video and Station B are still losing money, and the load of copyright purchase and production costs can be seen.
It is not difficult to find on the LETV APP that there has not been much new content on the platform in the past two years. Including "Hot Search", "Priceless Treasure", "Second-hand Masterpiece", "Save the Suspect", "I Love You", etc., are all movies with small and medium-sized costs but good reputation and popularity.
Zhang Wei said: "LETV will not buy new works on a large scale, these require professional talent reserves and financial strength, and the current LETV does not have it." ”
LETV Video has also made certain achievements. In 2023, there will be 197 new dramas, 251 anime, and 508 movies on LeTV Video. In addition, in 2021, when there is continuous controversy in the field of secondary creation, in the field of copyright distribution, LETV has also opened exclusive film and television copyright content for the use of secondary film and television creators, bringing more cash flow to LETV.
In recent years, the gross profit of the hardware industry is low, especially in the TV field, and most of the businesses are losing money. Therefore, Zhang Wei said that the new strategy of Le Rong Zhi lies in "cutting side branches and reducing losses".
In terms of enterprise management and company marketing, Zhang Wei's era faced bottomless debts with a contemplative and self-deprecating attitude, which became the background color of the survival of this neglected company.
When Zhang Wei was asked where he worked by someone he didn't know, his standard answer was: "An Internet company." If the other party has to break the casserole and ask to the end, he will bite the bullet and say the word "LETV". "'Is it the one your boss ran away?' and I'll say 'yes.'" Zhang Wei said.
So there is an opportunity to adopt a four-and-a-half-day work week in January 2023: "I hope that employees will not feel inferior, let them have an explanation in front of relatives and friends, and improve the morale of employees, at least let them feel that LeTV is an enviable company in terms of humanity." Zhang Wei revealed.
At the beginning of January this year, LeTV issued an open letter, mentioning that this year's Chinese New Year can take 2 more days off, plus half-day vacation per week, which is equivalent to an increase of 25 days of vacation per year for employees.
Earlier, in 2021, the LETV video client used the icon of "12.2 billion owed" to attract users to buy preferential members during the Spring Festival promotion. After the icon was launched, LeEco quickly drove a 20% increase in downloads compared to normal days.
Under the reform, LETV has indeed shown strong life tenacity. As of the end of September 2023, although LeTV has an asset-liability ratio of 1116.52% due to the increase in liabilities, LeTV maintained a positive cash flow in the first three quarters of last year, reaching 4.946 million yuan. Cash flow was also positive for the same period in 2022.
100% account sharing + copyright unbinding
If the "small and fine" copyright purchase is the way of LETV's defense, then the launch of the open platform is LETV's small and broad offensive method.
The time dates back to September 2023, at that time, when LeTV released the projector, it was indicated that it would be launched at the beginning of 2024 to benefit film and television producers.
The account sharing mode is as follows:Before January 1, 2026,Enter the LETV open platform,Only deduct necessary taxes、Third-party payment channel fees and mini program promotion costs,All others will be returned to the content provider,The account sharing ratio is 100%. The LETV platform also does not charge any service fees.
At present, the account-sharing model of film and television dramas on the head platform, the producer's account-sharing ratio varies between 50%~90%, which is determined by whether it is a solo drama, the rating of the drama (judged according to the quality and influence of the drama, and most of them are currently rated after the broadcast).
In terms of scheduling mode and pricing, LETV gives full autonomy to the content filmmaker. For other top video platforms, the platform side formulates the content schedule according to market expectations. In the summer, New Year's Day, or Spring Festival, whether to launch a disguised "advance screening", so as to create more revenue for the platform, is from this.
In addition,In order to give content producers more flexible cooperation rights,Xu Tianyang, head of copyright at LETV, introduced,The works on the shelves of LETV,The minimum period of copyright binding is3Months,After expiration,You can find another owner。 The current minimum copyright signing period of the head video platform is 3~5 years.
Xu Tianyang also revealed,Regardless of the first round of broadcast or non-first round of broadcast,Solo broadcast or joint broadcast,All the content of LETV video,Can be authorized to share accounts on the LETV open platform。 The pricing for users is also determined by the filmmaker, the price of a single episode is 0.1 to 50 yuan, and the price of the album is not greater than the sum of the price of a single episode, such as 20 works ≥, and you can also create an on-demand area.
"Works that are directly registered and put on the shelves after review do not need to discuss the specific matters of copyright cooperation with the platform, which simplifies the relationship between the author and the platform. Zhang Wei said.
"The reason why in addition to the membership system,Simultaneously launch an on-demand system to attract new users,Instead of expanding the advertising scale of LETV video,Is to give more choices of content to the audience。 Zhang Wei specifically mentioned.
At the same time, in order to encourage content filmmakers to settle in, LETV promises to launch three major support policies for film and television filmmakers who settle in the first year of cooperation. Among them, a one-time subsidy of 50,000 yuan per drama is granted to a TV series that is authorized to be broadcast exclusively on LETV's entire platform and the authorization period is not less than 1 year, and the total subsidy fund pool is 1 million yuan in the first phase.
In addition, Zhang Wei also emphasized that LETV's absorption of content this time is extensive and comprehensive: "No matter how long or short it is, what type of subject matter, as long as you are willing to settle in LETV, we welcome it." ”
Source: Interviewee
LeEco's new initiative is obviously unprecedented in the industry. However, is the concession contrary to LeEco's high debt?
In this regard,Zhang Wei said,LETV still has a lot of film and television copyrights before,There is still a certain proportion of the membership system as the revenue support of LETV,This open platform,100% of the copyright will be fed back to the filmmaker,From the text point of view, it is"Concession",But logically,In fact, it has transferred part of the revenue increment。
As for how to face the increased operating load after the increase in film sources, Zhang Wei responded: "LETV Video currently has only 200 operating personnel, less than one-tenth of the head platform. After the launch of the open platform, it is estimated that there will not be too much content influx in the early stage, and the marginal cost will not increase much. ”
Regarding the action of LETV to make profits, Chen Zemin, an analyst at Huafu Securities, told "Chinese Entrepreneur": "As long as the current bandwidth cost can be covered, the platform will attract traffic in this way, and the cost should be relatively low for LETV video." ”
In addition, from the perspective of the impact on the creative side, after the open platform lecture at the end of December, most of the on-site questioners were producers. Micro-short drama、Internet screenwriter Yang Huajie also said: "Many friends around me are discussing LeTV's new account-sharing model this time,Everyone is considering the first round of content works on the head platform,The follow-up may go to LeTV to do a second round of distribution。 ”
It can be seen that many creators have certain expectations for LETV's preferential policies.
In addition,In the field of hardware,The highlight moment of LETV TV is long gone。 In the TV, mobile phone and other markets where the price struggle is becoming more and more anxious, Lerong Zhixin is facing continuous profitability problems. These will be LeTV's big tests in the next two years.
Lack of consideration for user rights and interests
Although LeTV's plan to open the platform benefits the filmmakers, the new measures have not been enough to benefit users.
Zhang Wei introduced,At present,LETV's video is mainly divided into free(with advertising)、Member exclusive、Paid on-demand three business models,Paid on-demand is a new payment model launched in January 2024,Settle with Ledou,The ratio of Ledou to RMB price is10:1。 After recharging, LETV members can enjoy the film and television content in the monthly package in addition to the monthly package in addition to a certain amount of Ledou to meet some value-added experiences.
After exploring the new version of LETV APP, "Chinese Entrepreneur" also found that the price problem of LETV members, which has been criticized, is still low in terms of cost performance under the current situation that it is far from the content reserve of the head platform.
iQiyi (left), LETV (right) small screen price comparison. Source: APP screenshot
At the same time, the launch of LETV's open platform is indeed beneficial to the filmmaker, but it lacks consideration for the rights and interests of new and old members. At present, all on-demand content needs to be set up for in-member purchases, and for members who can only receive a small amount of Ledou (that is, tokens that can purchase content) to enjoy on-demand benefits, the space for value-added services is narrow. Compared with the top video platform, independent pricing has also led to the inflated prices of many dramas and movies with poor reputation.
In the past year, the new main content on LETV is mainly follow-up dramas, and "Da Shengkui" is one of the few solo dramas on LETV Video this year. There are many solo dramas that have broken the circle of iQiyi and Tencent Video, the former including "Hurricane" and "Lotus Building", and the latter such as "Three-Body Problem", "Long Season" and "Flowers". In the field of variety shows, which are not currently involved in LETV, new content on the head platform is also concentrated between 64~99.
In terms of movies, although LeEco has purchased the rights to popular films in 2023 such as "Hot Search", "Priceless Treasure" and "Second-hand Masterpiece", these contents are distributed on at least more than 5 platforms. LeEco also does not have an exclusive advantage.
At the same time, the drawback of LETV's video membership model also lies in the high proportion of in-app purchases.
Unlike other platforms, where only a few popular dramas are on demand in advance, a small number of high-priced copyrighted movies need to be purchased by members at a discounted price in the short term, and most of the content does not need to be paid separately. A higher percentage of LeTV's on-demand content is available at an additional cost.
LeTV on-demand content. Source: APP screenshot
It can be seen that although LETV video has given creators full bargaining power, it has failed to fully consider the role of the platform for users to check the cost performance in advance, and can only rely on the mechanism of market lag to adjust the price. LETV's specific pricing mechanism should also take into account the common rights and interests of creators and users.
In addition, from the creator's point of view, although many people began to pay close attention to the follow-up trends of the open platform after the launch of LeTV's new policy, the current state is still wait-and-see.
Yang Huajie said: "Although LeEco's account-sharing model is very attractive, it has been silent for many years, and the head platform has not yet been fully profitable, so the sustainability of LeEco's new measures remains to be seen." My friends don't have any plans to settle in recently. ”
In his opinion, LETV video still needs to focus on key areas in the future. Yang Huajie analyzed,For the content field that burns money,The future opportunities of LETV video may mainly lie in short dramas:"After all, the cost is low and the traffic is rising fast." ”
According to Yien data, the total number of short dramas launched in 2023 will exceed 1,400, with a year-on-year growth rate of 50%. In 2023, the market size of short dramas will be nearly 40 billion yuan, which is close to 70% of the volume of the film market. The outlook for the short drama market is promising.
However, the skit track has long been getting more and more crowded. Kuaishou, Douyin in the front, Youai Tengmang in the back, forward and backward, LETV has now lost its first-mover advantage.
In addition to LETV,In terms of hardware,The challenges that Le Rong Zhixin has to face are not small。 LETV, which used to be the top spot in smart TV, began in November 2016, after experiencing a crisis in the capital chain, shipments declined on a large scale. By 2023, the Top4 brands of smart TVs have become Hisense, TCL, Xiaomi and Skyworth, and the market share of these brands is as high as 75%.
The domestic color TV market itself has passed its golden age. Under the fierce competition, the profit margins in the hardware field are constantly compressed. LeTV's ideals are very full, but dreams are not easy to realize.
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