Compared to LeTV’s 1.8 billion yuan investment in TCL, 150 million yuan is only a small amount, but this is iQiyi’s first investment in a terminal manufacturing brand.

On September 13, iQiyi announced a strategic cooperation with Skyworth. The former invested 150 million yuan in Kukai, a subsidiary of Skyworth, accounting for 5% of the shares, and also signed relevant cooperation agreements on VIP membership services built into Skyworth products.

Cookaa is Skyworth’s attempt in the field of Internet brands, and it is also a sub-brand that it vigorously promotes. According to Yang Dongwen, President of Skyworth Group Co., Ltd., there are currently nearly 40 million new Internet TV units in China, a quarter of which are from Skyworth. The brand has more than 17.5 million Internet TV terminal activations, 8.28 million weekly active terminals, and 6.52 million daily active users. This growth rate is still rising at 30,000-40,000 per day.

This is not the first cooperation between Skyworth and iQiyi. The two parties have previously had long-term cooperation based on TV video content. iQiyi is responsible for providing online video content to some Skyworth models, while Skyworth is responsible for hardware support.

Compared with the complementarity of content and hardware, the cooperation between the two companies goes deep into the capital level and is also one of the ways for both parties to cope with the fierce competition in the video and TV fields.

“On the one hand, the number of Skyworth smart TV users is increasing day by day, and more content needs to be provided to consumers. On the other hand, iQiyi needs to rely on the promotion of smart TV platforms to gain more markets. ” Yang Dongwen said. In this regard, Gong Yu, founder and CEO of iQiyi, believes that TV screens are the center of home entertainment, and it is necessary to pool their respective advantages with high-quality partners to guide market upgrades.

As for the sharing ratio of the cooperation between the two parties and the sharing of member data, Gong Yu said it was inconvenient to disclose, but he emphasized that part of the revenue generated by Internet services should be allocated to the cooperative terminal brands.

However, Skyworth will not be the last TV brand that iQiyi invests in, and iQiyi is not Skyworth’s only content partner. Skyworth has previously cooperated with Tencent and Mango TV.

“We have mainstream suppliers of arrays, and iQiyi is one of them, which helps suppliers continue to improve. After all, the current market competition is no longer a you-or-me situation and needs to be more open, but cooperation with mainstream suppliers will be deeper. ”Yang Dongwen told the Jiemian News reporter.

This in-depth development is mainly reflected in the more targeted combination of software and hardware from both parties. The new China Dream series G7 TV previously released by Skyworth is equipped with iQiyi’s film and television resource backend. In addition, the two companies will also invest more resources to ensure service experience in terms of video clarity, fluency, user activities, and advertising display formats.

Starting from the next fiscal year, Skyworth’s Internet TV will pre-install VIP membership services and related content through the Galaxy Internet TV integrated broadcast control platform. iQiyi has accumulated a lot of experience in operating paying users.

Data from third-party survey agency iResearch shows that in July 2016, iQiyi’s monthly PC users reached 360 million, and its monthly App users reached 330 million. As of June 1 this year, the number of iQiyi’s effective VIP members has exceeded 20 million.

It is worth noting that as the second largest shareholder of iQiyi, Xiaomi and Skyworth have the same product categories. Regarding the differences in cooperation between Xiaomi and Skyworth, Gong Yu emphasized that iQiyi will maintain an open attitude towards cooperation, but due to different strategies adopted by different companies, the upstream will accommodate more content providers, while the downstream will support as many devices as possible to provide services.

In addition to iQiyi, mature video websites such as Tencent and LeTV are actively deploying TV terminals. Competition in the video industry has entered a post-competition era that involves fighting for funds and copyrights.

Gong Yu believes that in the post-competition era, the core competitiveness lies in original film and television dramas, animations and other variety shows. In addition, more technological innovations should be incorporated, such as mobile live broadcasts and optimized recommendation algorithms. “Although sufficient funds are still a necessary condition for competition in the video industry, the future team and execution capabilities will be the core competitiveness. Only by paying attention to the details and achieving the goal in a shorter time can we achieve the final victory. ”He emphasized.

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