Number of Paid Memberships on Leading Chinese Online Video Platform to Reach 100 Million in 2019, Technology and Innovative Content to be Key Drivers of Platform Development

BEIJING,Feb. 11,2019 -- Entgroup,a leading Chinese consulting firm,announced the release of a new corporate report,entitled Observations on the 2018 China Paid Video Market. According to the report,the number of paid members subscribing to China's online video platforms will surpass 300 million during 2019. This figure was 230 million members at the end of 2018,a number which has increased at a compound growth rate of 119 percent over the past three years,a much faster pace than compound growth in the overall number of Chinese internet users,which was 6.28 percent over the same period. With over 800 million internet users in China at present,the report indicates that there is vast room for growth in the China's paying member model video market. During 2019,the Chinese market will reach a point of maturity in which a single online platform could have over 100 million subscribing members.

Total Members on Chinese Online Video Platforms Compared with Total Internet Users in China

The report provides a comprehensive analysis of the Chinese online video market by analyzing the volume of "buzzworthy" videos,business models,market scale and development trends by integrating multiple data set from sources including the China Internet Network Information Center,financial reports from public companies and Entgroup's database.

"Our report clearly shows that paid content has already become a driving force in China's online entertainment market in 2018," said Liu Cuiping,Vice President at Entgroup. "This was most clearly demonstrated by the listing of market leader iQIYI on NASDAQ last spring,showing that capital is beginning to realize the huge potential of this market if companies have a clear business development strategy and a focus on attaining new members and the creation of strong original content."

Key findings in the report are as follows:

Top-tier platforms producing popular content will be key drivers of market growth. iQIYI has achieved a higher growth in subscribing members than Netflix,with subscribing members up 89% year-on-year in the third quarter of 2018.

High-quality content has laid a solid foundation for growth of paid memberships. iQIYI's Story of Yanxi Palace,a blockbuster drama and the most searched TV series on Google in 2018,has contributed greatly to the growth of the company's paid membership. The Rap of China,a smash hit variety show that was one of iQIYI's other hits,led the field in attracting new paid members by offering exclusive premium content and IP related benefits to members.

Story of Yanxi Palace

Online video platforms have created a new user-oriented business model through the implementation of a revenue-sharing model for the production of content. This model both encourages production studios to produce best-quality programs and reducing costs for platforms.

Crossover marketing strategies are boosting joint paid memberships. Video platforms like iQIYI have established strategic partnerships with online platform from other industries,such as JD.com and Ctrip,working together to increase paid membership and enhance the commercial value of the platforms.

A comprehensive IP-based value chain is being created on video platforms. In addition to advertisements and paid membership,online video platforms are discovering business opportunities in live concerts,live streaming,virtual goods,online gaming and e-commerce,which can push forward their capabilities for monetization.

Video Platform IP Ecosystem

Future development of China's online paid video industry:

China's entertainment market will continue its rapid growth in 2019,with dramas and movies being major drivers for increases in online paid video. Top-tier platforms such as iQIYI will continue to both produce and acquire premium original content to consolidate their brand among users.

AI is expected to play a larger role in personalized recommendations,as well as intelligent creation,intelligent production,intelligent distribution,intelligent broadcasting,etc. Both Netflix and iQIYI use their advantages as companies with a technology background to use AI in content production,making sure that their content is attractive to audiences.

China has huge market potential for paid memberships. Considering Netflix's recentraise in subscription fees,China has great potential in terms of increased penetration rate and pricing for online paid video when compared to the US.

To read the full report,please click http://www.entgroup.cn/Views/61677.shtml.

About Entgroup

Entgroup was established in 2009,bringing together all data resources in the pan-entertainment industry. Entgroup is committed to building a vast and open pan-entertainment data platform. Meanwhile,the company offers strategic suggestions and operational support in market observation connecting IP operation,content marketing and other specific business scenarios. Supported by industry solutions,Entgroup provides extensive data product services to many of partners as well as countless television and film works. For more information,please visit http://english.entgroup.cn/.

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