China leads way in livestreaming tech

Nation's internet infrastructure and more people hungry for social media content provide the perfect conditions for booming phenomenon

The Chinese livestreaming industry is blazing a new trail in the world's social media digital adventure, obtaining billions of dollars in value, which is projected to triple by 2020.

Nonexistent 10 years ago, the industry now boasts glamorous superstars who have hundreds of millions of followers, who watch their idols doing everything - from eating food to climbing skyscrapers - on their smartphones.

China's internet infrastructure and growing population of young people hungry for social media content have provided the perfect conditions for this booming phenomenon, with no end in sight. It is estimated that nearly 95 percent of Chinese internet users access online social media content on mobile devices, making the nation by far the largest livestreaming market in the world.

Large Western services, such as the game streaming platform Twitch, pale in comparison, despite achieving viewing numbers that rival those of such terrestrial services as CNN and Fox News. It is estimated that around one-third of the entire Chinese population views livestreaming content on popular platforms like Inke and Douyu.

It is not just the viewing numbers that demonstrate the stellar progress in China's livestreaming technology. The financial proof in the pudding became clear recently when shares in Chinese video streaming leaders provided a stunning performance for investors. The recent initial public offering of Huya paid off, as shares in the company increased by 16.6 percent on the New York Stock Exchange. In addition, iQiyi, dubbed "the Netflix of China", increased by 12 percent on the NASDAQ, to the delight of investors. Revenue in Huya also increased by a whopping 174 percent last year to nearly $356 million (301 million euros; ￡264 million), with many experts attributing this to riding the wave of success alongside iQiyi.

The increase in mobile internet penetration, e-sports and live gaming video content will elevate platforms such as Huya to the next level. As market leaders, these Chinese platforms are perfectly positioned to squeeze disproportionate benefits from these trends.

The Ministry of Culture and Tourism and the State Administration of Radio and Television have taken notice, introducing new rules this year covering the conduct of livestreamers to ensure that content is sustainable, healthy and prosperous. This will further enable the development of this new form of media consumption in a manner that integrates seamlessly into Chinese society and culture.

Chinese companies are also increasingly institutionalizing the industry, increasing the mechanical efficiency of manufacturing quality online content. Agencies scout for talent and work with platforms and brands for product endorsements and other advertising opportunities. Companies such as Weibo caught on just in time and started livestreaming services in 2016. Since then, the company has added more than 30 agencies to manage content and presenters to its platform for the coming year. Weibo has said that viewership has experienced a significant increase since the company began to work with agencies and managers.

The competitive landscape is now prosperous but very fierce for livestreaming platforms. However, many are positive that management and strategy in companies such as Huya will continue to find new ways to keep users hooked on social media content. Alibaba's Taobao shopping site is one such example of this. Livestreams of social media influencers trying on the latest fashions have proved to be an excellent way to introduce styles and products abroad to the masses.

The Taobao Live marketplace facilitates around 320,000 items added to shopping carts for every million views, a sales conversion pipeline that many other industries only dream of. The success of China's livestreaming is pulling up foreign industries with it, helping these companies to penetrate markets farther East. American fashion companies in particular are getting relief from continually declining sales back home, with Singles' Day in November last year resulting in livestreaming views hitting 3 billion at its climax.

Whether you look at the booming stock market, the increase in state guidance or corporate ingenuity, it is clear that China is setting the bar for the rest of the world for this new form of technology. Concerns a few months ago that the industry was starting to slow have since been eradicated by the sheer phenomenal growth in audience figures and rapid corporate movements in the country and abroad. If there is one industry that doesn't need to livestream its success, then it is this one.

The author is a London-based columnist.

Contact the writer at editor@mail.chinadailyuk.com

(China Daily European Weekly 06/08/2018 page11)