The hidden worries of the fast development of the game: the Black Hole

March 6, The Gathering Time (hereinafter "YY") released the financial year 2014 quarter and the full year earnings. Earnings showed that the net revenue for the 2014 fiscal year is 3.6784 billion yuan (about 592.8 million U.S. dollars), compared with 2013 of the fiscal year 1.8235 billion yuan growth 101.7%. Net profit of 1.0645 billion yuan (about 171.6 million U.S. dollars), than 2013 of the renminbi 477.7 million yuan growth of 122.8%, to the market hand over a bright-eyed earnings.

Behind the beautiful earnings, yy game live business but there are some worries, as the game live industry leader, YY Games live in 2014 to achieve a significant increase in the number of users, but its income growth is weak, the fourth quarter revenue is only 53 million yuan, is its internet value-added services, a few lines of revenue, the lowest income, But its input is indeed hundreds of millions of, from the development trend, the game live into a gold black hole.

It is noteworthy that in the subsequent earnings conference call, gathering time CEO Lee Colling said: "We will continue to increase the input in Tiger, 2015 is expected to invest 700 million yuan, further enhance the gathering time in this field of competitive advantage." "It is reported that this 700 million yuan in addition to increasing technology and hardware upgrades, the market will be a start, tiger Live will increase the inclusion of anchors, competitions, copyrights and brand building, such as the cost of the launch."

The Gathering time CFO He Zhenyu also in the conference call revealed: "Based on the current market competition situation, the company will not focus on the game to consider the profit status, 2015 we expect Tiger live will produce 400 million yuan in the single fiscal year loss." ”

In this regard, there is analysis that YY game live loss, is subjected to industry competition, because the game live for the interval users of high viscosity, the game can not be lost, but in the competitors are continuing to invest in the case, in order not to lose users, YY had to follow up; On the other hand, it is difficult to direct the show In the existing four revenue models, because advertising can significantly affect the user experience, each platform is very cautious, so this revenue is basically negligible; and the game through the transport is from a game to another game to replicate users, its effect is limited, the risk is also very large; In addition, membership subscriptions and virtual props in addition to YY, other platforms have not formed a system. From the above analysis, this is a knowingly lose money, but have to continue to invest in the business.

In fact, the game is a direct play is a capital game, in the money to hit the flow, with the flow of investment, and then money to buy the flow of the reincarnation, the investment side by the platform, commentary, organizers and other competitions to create a common industry growth curve, the bubble more blowing. Previous media reports said, "The rise of the game live, fat understand that, lost the platform, nasty VC." If you add one more word, you are happy to die. IDC and telecom operators.

In addition, from the beginning of the year to expose the game anchor annual salary irrational growth of dozens of times times even a hundredfold news to see, game broadcast this industry competition has been very obvious, this year's operating costs will multiply, coupled with high bandwidth costs, the game will face a big shuffle in the industry this year, YY's move is a very obvious signal.