Charts of the Day: How China’s Short-Video Obsession Creates a New Battlefield
Short videos are probably grabbing the most attention in China’s internet landscape, reshaping the content market as people’s attention spans grow shorter.
Mobile apps streaming short videos, which run between 15 seconds and several minutes, became China’s most popular internet service last year, absorbing a quarter of the time netizens spend online, according to a survey by research firm Aurora Mobile.
China’s short-video market reached 140 billion yuan ($21.5 billion) in 2020 and is expected to top 600 billion yuan by 2025, according to iResearch.
At the end of 2020, Chinese internet users spent an average of 27.3% of their online time watching short videos, surpassing the 21% spent on instant messaging, according to the report.
Users devoted an average of 2 hours every day to watching short videos, making it the most-used daily app category, data showed.
The number of short-video viewers in China rose to 873 million by the end of 2020, accounting for 88% of the country’s total internet users and 62% of its population, according to the government-backed China Internet Network Information Center. The group expanded by 100 million in the last nine months of 2020, reflecting growing online entertainment consumption during the Covid-19 pandemic.
The massive number of users represents valuable online traffic, the backbone of internet companies’ growth. The saber rattling between social media giant Tencent Holdings and rising challenger ByteDance Ltd. — owner of short-video platform Douyin and its overseas twin TikTok — spotlights the disruptive changes brought by short-video platforms to the internet industry.
Douyin and Tencent-backed Kuaishou dominate China’s short-video sector. According to Aurora Mobile, Douyin had average monthly active users of 629 million in the fourth quarter 2020, while Kuaishou boasted 331 million.
New players from different business backgrounds are flooding into the industry in hopes of expanding their access to consumers. They include traditional online video platforms such as iQiyi, which have tapped into short video streaming services as their business is eroded by new rivals.
Short videos originally focused on entertaining content and profited from advertising and viewers’ rewards. But as more short-video platforms expand their services into livestreaming e-commerce— the practice of promoting and selling products via livestreams — their revenue sources also diversified.
In January, TikTok raked in nearly $128 million in revenue, making it the world’s highest-earning nongame app. About 82% of the January revenue was from the China version Douyin. The short-video platform debuted its e-wallet Douyin Pay, putting itself in direct competition with Alipay and WeChat Pay by allowing users to purchase items from third-party vendors, buy virtual gifts for performers and pay to watch their shows, as well as buy goods during livestreamed e-commerce sessions.
While expanding their business reach, short-video platforms are also seeking to upgrade their content from pure entertainment to more knowledge-based content to meet viewers’ demands for higher-quality material, according to Aurora Mobile.
The changes reflect growing pressures facing short-video platforms as their user growth approaches a peak, forcing them to search for new growth sources, according to the report.
Contact reporter Han Wei (email@example.com) and editor Bob Simison (firstname.lastname@example.org).
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