The Dilemma Of Chinese Online Videos Sites

In recent comments, Martin Lau, the president of Tencent, China’s largest internet company by revenue, said the state of the video streaming market was “very unhealthy for everyone,” and that “all other digital content industries are actually in a better shape than the video industry.”

The Chinese video sites Lau was referring to are competing aggressively in terms of content creation, while financial growth is still limited. He pointed to limited revenue streams as a problem in the industry, which has become bloated.

As of June 2016 China had had 514 million online video viewers, over 70 percent of total Chinese internet users, according to China Internet Network Information Center. Mobile video streaming users reached around 440 million.

There’s no doubt that on-demand video streaming has been eating up market share of traditional TV, and easy, free access to massive legitimate online video libraries across the Chinese web has made piracy less appealing.

So why is China’s online video streaming market “unhealthy”?