Live in the irrational competition stage, the burning money race so crazy

Today, the Gathering Time (NASDAQ:YY) recently released its fiscal year 2014 as at December 31, the quarter and the full year earnings. In the ensuing analyst conference call session, the gathering time CEO Lee Colling revealed that this year plans to invest 700 million yuan in the game live business. Such a big investment also draws attention to the field of live play.

2014, including yy, Sequoia, soft silver and other capital, such as the admission of the layout of the game live, the domestic emergence of the LOL TV, tiger live, Dou Fish TV, banner TV and other games live platform, attracting more than 100 million dollars in capital. But recently, the major games live platform into a capital cycle, first hit the money to sign the host to do high traffic, and then hit the money to sign more anchors. Industry insiders said, "the game is now caught in the irrational competition stage, basically equal to burning money competition." ”

Where did the money burn?

The first stop for burning money is not the host. A game broadcast company executive said that in 2013, the top anchors of the signing of about more than 300,000 yuan, the anchor value in the last more than a year almost rose. Why is the game platform so crazy?

All along, the domestic game broadcast industry pattern can be divided into the official nature of the game live platform and yy, Dou fish, such as the third party platform two camps. The official platform for game development companies or agents, with upstream resources. Third-party platform is congenitally deficient, can only rely on the buyers to accumulate resources, to seize the market. The user is quite sticky with the anchor. Many users will buy props on the platform for their favorite anchors. So the anchor's worth is growing.

At present, most of the host's source of income is divided into three major chunks, the first is with the live platform of the signing of gold, the ratio of more than 90%, is currently the most powerful, and second, live to receive the gift of fan gifts income, monthly in the range of hundreds of to tens of thousands of, the third is to open Taobao store income, this handful of the top anchor moon water can be millions.

South Korea's AFREECATV platform anchors are also most of the annual income of billion, where the revenue is mainly in props and advertising, while the AFREECATV platform's main revenue also 60% from the user to buy the props for the host. So the platform relies heavily on anchors.

In addition to anchors, the Chinese game broadcast platform on the bandwidth of the cost is far higher than the United States platform.

Twitch has built the computer room and the state of the fiber, while in the states and municipalities, access to at&t these telecommunications operators are free. In the United States if you have a lot of content, the telecom operators are very happy to open access bandwidth, because users will pay more broadband packages for video. Content providers and telecommunications providers are mutually beneficial.

In China, the access to each K bandwidth, need to IDC room or CDN to pay for telecommunications or unicom. Dou Fish, for example, the highest publicity ever have tens of thousands of people at the same time online, even if peacetime according to its maximum concurrent volume of 30% calculation, its annual bandwidth cost is also 600 million.

YY Executive Vice President Cao Jin pointed out that the current game broadcast market has been a disorderly appearance, many participants are blindly burning money, but the game live in this industry can not be done by burning money.

What is the future?

The number of users in these game-live platforms can not be underestimated. According to the data, 8 of YouTube's top 20 hosts include the first game-related video and 6 are entertainment videos, so you can see that the video and the live user base are great.

The current live-life User (MAU) of the US game live platform, mentioned above, has reached 60 million twitch, so there is no traffic comparable to Netflix or YouTube in the U.S. region.

Domestic, 2013-2014 is the start-up period, is the core user for the PC-side game enthusiasts mainly, the competition game player permeability is very high, through the game live platform, these users find a gathering of network sites, follow the favorite electric competition star. And in 2015 into the sedimentation period, the market is still dominated by the game enthusiasts, but more long tail game content to join, so that more games users to join.

Some insiders believe that the game live market will enter the outbreak in 2016, host game with the lifting of equipment terminals into the game user groups, will bring a certain scale of the game live users, along with the mobile video recording technology, mobile phone games will bring a larger number of users. It is expected that the 2017 China Game Live user scale or up to 148 million.

From this perspective, the market and users are the game of live broadcast industry to become the basis of the current. Based on the huge traffic, the game live platform can be realized by value-added services, game transport, advertising, content subscriptions, electric dealers and sports quiz and other means to achieve profitability. With the development of the platform, the future of these live platforms is likely to become an important channel of game marketing and a key tool for content promotion.

While Amazon's 970 million-dollar game-video start-up, Twitch, has not yet been profitable, its model is still worth learning. Twitch current income acquisition methods are mainly 2 kinds: VIP members and advertising. And the advertising part, the Twitch and the host is divided into a system, live gap between the advertising revenue will be part of the live broadcast, and because the platform's influence is big enough for the host's dependence on the level of the domestic game platform is not so high. Twitch is currently working with a host of game events to get a certain amount of advertising revenue.

However, can not forget that the game live video of the copyright by the game screen copyright, the anchor personal copyright and music copyright three components, once one of them, the live platform will be difficult to roll over. Although the current domestic official live platform did not massively suppress the Third-party platform, but to adopt a common attitude to foster the market, but can not guarantee the future will be bridges.