One month ago there was some news that Ai Qiyi would acquire PPS through Baidu Now this has been confirmed, Baidu will spend $400,000,000 on acquiring Shanghai Public Source Network Co., Ltd. (PPS). After completion of the acquisition, Ai Qiyi will likely change the overall content and production line of PPS so that they can complement each other's shortages. Many people are optimistic about this merger, Ai Qiyi can complement its shortage on PC side and PPS can also get more copyrighted film and television resources.
After the merger, the two sides will see an improvement on market coverage, and then to see which brand Baidu hopes to strengthen. Ai Qiyi named itself as the Chinese version of Hulu since its birth, but it is proved that it is not suitable for the Chinese market after 5 years, it is forced to start transition. But regarding the copyright of long videos, it is suppressed by Sohu exclusive policy; regarding the homemade drama shows, it is suppressed by Youku&Tudou. While PPS adapts to Chinese environment well since it was born for Chinese. Although there are some pirated video content, it is still manageable, also the number of users of the PC client and mobile clients are also considerable.
After the completion of the acquisition, Ai Qiyi will become one of the few integrated business video sites which has the capability to compete with Youku&Tudou and Sohu.
The supplement to PC client shortage
Ai Qiyi began the development of its own brand desktop client in 2012, they hoped to improve user experience by supporting offline downloading and save bandwidth through P2P acceleration. But the end result is not satisfying. user experience of multiple versions of the product are not very satisfactory,
In addition, marketing to its PC client is also very low scale,, even very few people know that Ai Qiyi has a desktop client, its active users are estimated not more than one million.
The acquisition of PPS can supplement Ai Qyi's shortage on PC client. It is possible they will improve PC client this year, or integrate the copyrighted content of Ai Qiyi to PPS to enhance the popularity of Ai Qiyi brand, or Ai Qiyi will launch a new client with integration of PPS's live resources.
UGC content to supplement short video traffic
The UGC model which accounted for 60% video website traffic in 2012 is attractive again. PPS launched a UGC short video product - Ai Channel, this is to make up for the decline in user traffic because of copyright reasons.
The UGC model brings about 10% traffic to PPS, they can direct the traffic to Ai Qiyi by recommendations in PPS, this will be another source of traffic to Ai Qiyi, and Ai Qiyi is completely blank in this area now.
Can learn a lesson
In fact, the acquisition is sure to make everyone think of Youku and Tudou merger,The two sides integrated their copyright resources together to expand their copyright repository, in turn it improves the ability to compete with other competing websites.
Ai Qiyi can learn something from Youku such as how to do authorization management for copyrighted content; how to implement copyright policy in two different brands; how to allocate tasks: who will mainly focus on operations and who will mainly focus on technology research and development.
However, after the merger, content, resources, advertising and client platforms need to be integrated, this will take some time. Hope there will be no management turmoil in order to avoid the situation of the collapse and disappear. Once the adjustment is completed, there will be only few video websites which have businesses including web site, PC client, UGC, community and mobile platforms. Youku&Tudou, Ai Qiyi, and Sohu video will be the three pillars of the era.
Source : http://www.36kr.com/p/202874.html
