YouTube bought Twitch with 1 billion dollars

Editor's note: This article from the Tencent Game competition platform product owner Qian, from the professional video competition angle of the domestic game Live mode analysis, we can communicate with her through the mail, youxizhibo139@163.com.

In May this year, YouTube bought Twitch with 1 billion dollars, and the gaming video industry has received a lot of attention. What kind of industry is this, and what kind of value does he have in it, and will the Twich pattern blossom in the other side of the ocean?

The origin of the Twich model

Twich's business model is very simple, players use software to upload their own game live screen to Twitch,twitch according to the game category and the number of viewers to the live channel, the host again based on the audience's subscription and advertising revenue. With the twitch of more than 40 million of the month's huge active users, and the occupation of PCs and home-machine channels, the 1 billion-dollar purchase price was born.

Twitch's parent company, YouTube, which had been bought by Google for 1.65 billion dollars, and its imitators, Youku, climbed over 7 billion dollars in market capitalisation, it is hard to judge whether the value of 1 billion dollars is high or undervalued in the current state. However, we will use specific figures to analyze the future of the Twitch model in China.

Cost accounting of domestic direct seeding platform

Any business model, cost calculation is very important, the game Live mode cost = Bandwidth fee + Enterprise operating costs + market costs.

Let's analyze bandwidth costs first, Twitch has almost no bandwidth cost in the United States, Twitch has built the computer room and the state of the fiber, while in the states and municipalities, access to at&t these telecommunications providers are free, in the United States if you have a large number of content, telecommunications operators are very happy to open access to bandwidth, Because users will pay more for the video package, the content and the telecommunications business here is a mutual profit.

In China, the access to each k bandwidth, need to IDC room or CDN to pay for telecommunications or unicom. We have to calculate the game live example, provided to the user 800K rate of clarity, if the platform 100,000 people online, is 80G bandwidth, 1G per year 250,000, then the need to spend 20 million, and 100,000 people online, according to the game media to evaluate, one-day UV will not exceed 1 million. Because the personal live broadcast also cannot use the Peer-to-peer delay, therefore the bandwidth cost is very high.

Compared to bandwidth costs, the current domestic live platform "Sea of blood" generally rob high-end anchors, the cost of the market more frightening. To "Dou Fish" platform for example, April to buy high-end anchors, the team and pay the "King's Road" activities in total to pay more than 2.4 million yuan, May also more than 2 million, a single anchor a bit more presentable have opened 10,000, excellent anchor more than 350,000; Team contract 1.5 million/year The road of the king of the activities of the Hero League King of all good and bad money.

Because the high-end league resources for the TGA and other official platform master, Dou fish in the domestic ordinary place of the second-line three-line game also put a lot of costs. The same new platform "banner" for the EDG War team, pay 3 million/year costs.

The cost of the above two parts Twtich close to 0, even so, Twitch is still in a loss situation, the domestic platform of "burning money" state is really staggering.

The groping of income way

"Burning Money" in the internet industry is not unusual, if the future income can be, "burning money" is understandable, so we also analyze the game Live mode of income May.

Twitch Subscription mode, we do not analyze, the video website dismal paid subscriptions to tell us that the Chinese people do not have such a habit; advertising mode, in the domestic short-term possibility of small, advertising model needs of the scale, the brand decision CPM value, not formed overnight, live buffer advertising market cultivation takes a long time.

Speaking of game live, we might as well see another kind of live broadcast "show field" mode, let 9158,yy, six room make pot full. There are many similarities between the show pattern and the live game, but the difference is great:

1 The same number of bandwidth expenditure game broadcast about 7-8 times the show field (professional and technical personnel can quickly understand)

2 The ARPU value of the show field is more than 400 everywhere, part of the show is even more than 1000, but the game live very poor, with YY number one anchor "I'm in Dongting Lake" For example, daily live viewers online more than 50,000, but prop income in January only tens of thousands of; ARPU value is only dozens of of the show field.

Game broadcast is a branch of UGC, despite the large audience, but the high expenditure and the non-renewable income, so that the business model cast a shadow. To China's largest game live platform yy as an example, although the game live online more than yy show, but how does yy see the game live?

1) Although Lee Colling said that the game is an important model, but unfortunately the financial results of the little mention of the relevant information, the company's strategy has not been closer.

2 The bottom of the executive team often because of bandwidth problems, the overall reduction of the game live rate subsidy show live, this is in the show team here is completely impossible to happen.

What is more worrying is the risk of copyright law, the copyright of the game live video, by the game screen Copyright + Anchor Personal portrait and audio + music copyright three composition, while the live platform to spend great effort and the host signed agreement, only contains the anchor personal portrait and audio rights, once the official game company to dissent, It is difficult to guarantee the benefits of a live platform on the legal level.

Questions and hopes for live games

One, compared to yy, Dou Fish, the banner of these live platforms lack of traffic, so money to buy people has become the only breakthrough means, and the problem of this model:

1) did not see the direct effect, the author and many anchors, as well as live web site editing exchanges, showing online number of fraud is very serious, a platform tens of millions of input, daily average UV only 4, 500,000 UV.

2 because of the slow formation of ecological relationships, temporary hit the anchor, can only be sustained by throwing money.

3 The Battle team signed live broadcast can not have a lasting effect, YY's first second anchor Dong Small, dongting Lake, the average daily live more than 5 hours per month, the maximum rest day, such a high strength to maintain the live online popularity, this is the professional team can not do.

The above situation shows that the mode of the buyer's maintenance is actually not scientific, unless there is a steady flow of capital involved, but if the cost of capital investment in research, it is easy to see the problem.

Second, the team ability is the game video industry bottleneck, according to my understanding of the information, the industry several platforms, practitioners lack of experience, the overall prime number is lower, so it is also the root cause of the problem.

It can be seen in the video game, although the popularity of the industry, but the current business model is not small, so whether the practitioners have show field experience, value-added services experience, game transport experience, community experience is particularly important. Otherwise, even if you get the investment, it will continue to wear out until closed.

Third, this issue and direct business model is irrelevant, because the author is an electric competition enthusiasts, have to fill such a problem, video games live on the electric competition market has some harm:

1 The team has no love for the live platform, only the relationship between payment and execution. If the end of the burn money, the team will be less than a large income, for the current immature electric competition team, is likely to fluctuate

2 game video Industry makes the current many anchor income higher than the battle team professional players, which makes the contestants are ready to retire, or even better than active service, and such a phenomenon in Korea is to be eliminated. Wang Power competition Insight and gaming companies can be deeply concerned about this issue.