LeTV Hardware Distribution, What You May Not Know

On the afternoon of August 16, 2016, it was a welfare day for rice and LeTV. Liu Peifu, vice president of LeTV’s Television and Internet Group, announced that the IP tomb notes that will not be exhausted this summer and have nearly 900 million boxes at the box office will be spotted on LeTV. The users who purchased the Tomb Raider Notes customized version of Super TV in the early stage will take the lead on the big screen to take the lead in enjoying the innocence on September 6th. After LeTV held the conference with the users, the tomb notes and LeEr finally ushered in the day of the “Wang Explosion” of the big-screen ecology. Premium content is distributed to LeTV on a pay-per-view basis and revenue is divided into shares with the parties (divided into !!). LeTV calls this business model "hardware release." The tomb notes became the first time that crabs were eaten. It is worth noting that this tomb notes will only be screened exclusively by LeTV and will never be free after the hardware release window has passed.

Hardware distribution and large-screen ecology are actually complementary to the traditional theater distribution. If this type of entertainment industry's entire industry chain company's gameplay can continue to advance, both the film industry and the smart TV industry are once again subverted.

Traditional publishing difficulties

The object of subversion of hardware distribution is naturally traditional distribution. Over the years, traditional distribution has always been the most fierce competition in the film industry chain. In order to allow more viewers to see films on the film side, the issuer has negotiated with the theater manager to create star scandals and create offline roadshow opportunities. For some newly established or transformed private companies, their approach to the film industry chain is often issued. The film side always needs more viewers to go to the cinema to get more box office income in one movie. Therefore, as long as investors feel that the input-output ratio is appropriate, there are several issuers in a movie that are commonplace. As a result, more small and medium-sized publishers can also find their living space from joint distribution. Over the past few years, China’s movie distribution companies have reached as many as several hundred, and the largest traditional private film distribution company, Light Film, has even reached a scale of 1,000 people.

In the Internet age, even more forward-looking, under the technology background of the Internet of Things era, although the traditional distribution did not completely disappear, it was indeed affected. In the end, the distribution is a live broadcast and has a strong relationship with the user scene. More than a decade ago, in the era when television was broadcast only, watching movies on weekends was basically the only form of entertainment, and cinemas were the only viewing scene. But now, if you just want to lie down at home on the weekend, blow air-conditioning, watch movies, spend boredom on short-distance transportation, or miss the movie release due to busy work, for traditional publishers and theaters, What about these potential audiences?

In 2015, the total number of films released in mainland China reached 358, and a movie was released on a daily basis. In the first half of 2016, there were 192 films on the mainland, an increase of more than 30% over 156 of the same period last year. Such a huge number of films, together with the screening system in the Chinese cinema system, will naturally dilute the release time of each film. For example, the recent hot tomb notes in the release of a week time, the cinema platter from the first day of August to 40% of the proportion fell to less than 14%. For most people, if you don't have time to go to the cinema to watch a movie within a week of the release, then on August 12th you want to go to the cinema in the better location to see the movie. One word: nothing.

The movie began to quickly disappear. How to do? Is the movie completely lost its value after being released from the theater? It's time to think about the after-market cinema. In addition to the movie theaters, among the more mainstream screens of PCs, mobile phones, televisions, and tablets, the closest to the cinema's big screen viewing experience, and the one that can maximally complement the movie theater viewing scene is obviously television.

Li Shu TV dream for 10 years

Speaking of selling content on the basis of hardware and the layout of living room Internet TV ecology, the originator of this business model is obviously LeTV. But in the past year, another smart TV company that seems to be unknown has succeeded in provoking my writer's curiosity. This is micro whale technology.

This company, which was established only a year ago, was founded by Li Ruigang, who left Shanghai Cultural Media Group last August. At the same time, Li Shu has another identity: Chairman of the Chinese Culture Industry Fund. The only private equity fund registered with the National Development and Reform Commission controls the leading companies in the style and technology fields of Oriental DreamWorks, Sports and Sports, Star Star TV, IMAX China and others. Although holding high-quality resources, Mr. Li unexpectedly started his second venture: Associated Ali, Tencent and the Central People's Radio established a smart TV company: Micro Whale Technology.

In the eyes of Li Ruigang, micro-whale TV plays a central role in opening the entire Chinese culture industry. As early as 10 years ago in the era of IPTV (television network transmission signal television), Li Shukai established BesTV, showing its extreme importance to television as a content-bearing platform. In the era of the Internet and the Internet of Things, in the eyes of Li Ruigang, the importance of TV as a living room center and a family entertainment center is still the same. The entertainment consumption power that a family of three can gather together is obviously higher than that of cinemas. Relatively unfamiliar environment.

Indeed, the average number of Chinese people viewing a movie theater is less than twice per year. But as long as we look at the people around us, do you really see two movies every year? On the contrary, the Chinese people, especially those living in the first-tier cities, and college students are spending more and more time on the movies, and their viewing channels are dominated by PC-based small-screen hardware. The cinema will continue to exist due to social attributes in the future, and the big screen ecology in the home will replace the PC, providing users with a private viewing space.

In fact, not only companies with small whale's existing industrial backgrounds but also government backgrounds have been cultivating a large screen ecosystem. Video websites such as storms and popularity have also launched their own smart TV products in the past two years. Although the smart TV of its cabbage price has left people saliva, relying on the aura of industry pioneers, high-performance hardware and ecology, LeTV has some advantages.

Is it subversion?

At the press conference on August 16, LeTV announced that the first hardware release will be used on the Tomb Notes for the hottest IP movies this summer. The Tomb Notes will be released on IP custom TV on the 6th of September in hardware distribution mode, and will never be free for non-members. In other words, users can see tomb notes on the TV at home as early as one month after the movie is released. This collaborative business model across the industry chain is a milestone event for the IP, the screen ecology, and the tomb notes IP.

Why do you say that? First of all, conservatively speaking, it usually takes at least two months from the release of a movie to the viewing of a genuine original on a smart TV. There is a long and numerous negotiation process in the film's online broadcasting rights. Especially for large-scale films, it is not easy to want to broadcast alone. Since LeTV was one of the producers of the Tomb Notes, this time it was during the multiple negotiations with the film party that the film was just off the line and it was in the form of sharing the on-demand fee with the film party to win the large-screen single broadcast rights. If there is no investment in the content and it is bound with the interests of the filmmakers, it is hard to imagine that such behavior will be recognized by the filmmakers.

For LeTV's large-screen ecology, the market after the exclusive cinema has become an incremental market to be discovered. This year, after LeTV took a stake in TCL and acquired Vizio, its total smart TV stock amounted to 28 million units. If the future hardware distribution model is promoted at the same time in LeTV's three brands, the box office revenue will be greatly expanded on the wireless shelves. Assuming that each viewing fee is charged at 10 yuan, Le Shiheng's market revenue based on a film will reach a staggering 300 million (although this is a bit optimistic). If you take the tomb notes as an example, this is equivalent to the box office. One-third of income.

Finally, for IP, if an IP movie is only released in theaters for a month, the value of this IP in the text of the movie is difficult to fully unearth. The big screen extends IP's influence on users infinitely. At the same time, the unique IP also binds the fans more tightly under the LeTV video platform.

The film was happy, music was happy, and IP holders were happy.

Suddenly remembered the opening words of LeTV: "I'm not a TV, but a complete Internet big screen ecosystem." This is a long face or a face. We will wait and see.

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