In­ter­net TV brands switch onto smart busi­ness op­por­tu­ni­ties

China Daily (Hong Kong) - - BUSINESS - By FAN FEIFEI fan­feifei@chi­nadaily.com.cn

In­ter­net TV brands will ex­pand rapidly in the next five years even though tra­di­tional mar­kets are al­ready saturated.

In­dus­try in­sid­ers point to part­ner­ship deals in­volv­ing TV man­u­fac­tur­ers and on­line com­pa­nies to de­velop smart con­tent.

Dong Min, gen­eral man­ager at con­sul­tancy All View Cloud, or AVC, in Bei­jing, stressed that man­u­fac­tur­ing and con­tent com­pa­nies in the in­dus­try are start­ing to march to the same tune.

“It shows the era of smart TV is com­ing and that con­sumer de­mand is now more di­ver­si­fied,” Dong said.

Last week, TCL Corp, one of China’s largest home ap­pli­ance and TV man­u­fac­tur­ers, an­nounced plans to link up with Ten­cent Hold­ings Ltd.

Un­der the terms of the agree­ment, Ten­cent will preload video con­tent onto TCL in­ter­net-con­nected or smart TV sets.

The Shenzhen-based tech be­he­moth will also take a 16.67 per­cent stake in Thun­der­bird Net­work Tech­nol­ogy Co Ltd, a sub­sidiary of TCL, for 450 mil­lion yuan ($66.2 mil­lion).

This will make Ten­cent the sec­ond-largest share­holder of Thun­der­bird Net­work, which makes smart tele­vi­sions.

“We ex­pect to bring Ten­cent’s games, films, so­cial me­dia and other en­ter­tain­ment re­sources to TCL’s smart TVs through this deal,” said Guo Tong, vice-pres­i­dent of TCL Mul­ti­me­dia.

“We hope this will in­crease the mem­ber­ship base and raise Ten­cent’s rev­enue from users pay­ing for con­tent,” he added.

Last year, TCL sold 20 mil­lion TVs glob­ally with half of them smart sets.

The Chi­nese group is now just be­hind South Korea’s Sam­sung Elec­tron­ics Co Ltd and LG Elec­tron­ics Inc when it comes to world­wide sales.

Still, link­ing up with a con­tent provider makes sense as there are about 20 in­ter­net TV brands in the coun­try.

“And that mar­ket is set to grow,” re­ported China Mar­ket Mon­i­tor Co Ltd, an in­dus­try re­search firm.

Fig­ures re­leased by con­sult- ancy AVC showed that in­ter­net TV brands man­aged to grab 18.9 per­cent of the to­tal tele­vi­sion con­tent busi­ness in China last year, a jump of 8 per­cent com­pared to the same pe­riod in 2015.

The re­search com­pany also showed that TV sales here to­taled 50.89 mil­lion units, worth 156 bil­lion yuan, an in­crease of 7.8 per­cent from the pre­vi­ous year.

But the over­all pic­ture was mixed as tele­vi­sion man­u­fac­tur­ers suf­fered a down­turn in the first quar­ter of this year, with ma­jor play­ers re­port­ing a drop in net prof­its and sales.

This goes a long way to ex­plain­ing new part­ner­ships with in­ter­net TV brands.

Back in Feb­ru­ary, e-com­merce ti­tan Alibaba Group Hold­ings Ltd bought a 25 per­cent stake in Haier Mul­ti­me­dia for 657 mil­lion yuan.

Qing­dao Haier Co Ltd, the listed arm of home ap­pli­ance gi­ant Haier Group Corp, also paid 525 mil­lion yuan for a 20.2 per­cent share in the com­pany.

“Last year, in­ter­net tele­vi­sion brands grew rapidly, but their sales were down in the first quar­ter,” said Sun Taitong, an an­a­lyst from in­dus­try watcher China Mar­ket Mon­i­tor.

It shows the era of smart TV is com­ing and that con­sumer de­mand is now more di­ver­si­fied.” Dong Min, gen­eral man­ager at All View Cloud TV sets were sold in China in 2016

PRO­VIDED TO CHINA DAILY

Smart TVs are dis­played at the 2017 Ap­pli­ance & Elec­tron­ics World Expo in Shang­hai.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.