By Yang Yang
Published: 2007-04-18

 

Sites similar to the "China International Chinese Television Station" that organize their own journalists' reports and illegally create content have been banned. Meanwhile, sites that directly broadcast traditional television content online and are actively infringing copyrights, and porn sites with downloadable short films, are becoming ubiquitous.

Internet television has extremely high technological requirements; the slightest error will disrupt the smooth viewing of content and affect the consumer's experience. Wang Xiaochuan, vice-president of Sohu tells us that Sohu's P2P technology has drastically helped the development of internet television. Even so, this is a mortal weakness for some online video websites.

Profit models are also suffering. Besides advertisements, there are almost no other revenue channels, and small websites that do not have the advertising capacity of of Sina, Sohu, and Tengxun are often pulled under. While some larger websites are refusing ads, smaller websites are left on the sidelines.

These large domestic companies pushing the limits in internet television are causing difficulty for small companies that purely copy the successful US site YouTube. "This will cause a shakeup in the industry. This year will be a lively one, with a lot of businesses going bankrupt," says Guo Qiang, vice-president of Beijing Huojulianhe Network Services Limited.

But the $1.65 billion purchase of YouTube by Google has already become a catalyst for internet video sites.

In 2006, venture capitalists had already burned $100 million on the online video industry. Last August, Tudou had received a second round of $8.5 million in investment, Youku also received $12 million in a second round of venture capital. At the beginning of this year, Youshi received a second round of $23.5 million in financing, after already receiving $18 million.

Through cooperative purchases made with the State Administration of Radio, Film, and Television, Sina, Sohu, and Tengxun have settled copyrights. Ao Ming, chief inspector of Sohu Sports Center, tells us that when the World Cup broadcasts started, Sohu had already gained rights to NBA, CSL, CBA, CUBA, and other high-profile competitions, "taking the NBA live broadcasts as an example, when the Miami Heat played Houston Rockets, the online audience reached 1.24 million."

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