Chinese startup ecosystem has been able to set amazing examples before the world. This week, we are going to talk about a platform which is called the king of titillating content and is one of the biggest content platforms in the country. It is Jingri Toutiao (means Today’s Headlines in English).
Launched in 2012 by Bytedance Technologies, Toutiao claims to have over 800 million registered user base and 200 million daily active users.
Overall, the company has raised over $3.1 billion till now. In August 2017, it was valued at $22 billion when it raised $2 billion in a private equity round from General Atlantic.
The platform has been able to capture a huge user base through its technology. Based on a user’s location, smartphone model and click history, the ML algorithm sorts through the latest news, commentaries and videos from its 4,000 plus partner sites to find appropriate content for the user.
Besides, to attract the youth, it provides eye-catching news content with cartoons, GIFs, live streaming shows and interactive Q&A channels for entertainment purposes.
Its video section provides funny short videos and jokes to users. All the videos are around 10 to 15 seconds, covering a wide range of topics that keeps a user engaged. The video section user interface, makes it easy for users to binge watch.
DouYin, Flipagram, Xigua Video and Huashan Zhibo are some of the video platforms operating under Toutiao.
DouYin is a platform that allows users to create and watch funny music videos. It is similar to Musical.ly, which Toutiao acquired and later merged with Douyin to expand cumulative user base.
Flipagram is another app from Toutiao that has one sole purpose to help users make short movies out of their images. In the US, the app attracted a huge amount of attention from teenagers.
Besides, Xigua Video has over 100 million users while Huoshan Zhibo boasts of gathering thousands of powerful Chinese influencers.
It is important to note these platforms focus on producing original content and pay huge money to content creators.
Money making part
Over the past couple of years, Toutiao has turned to marketing and advertising for monetization. It leverages its 800 million registered users and 200 million daily active user base to attract brands which want to advertise over its platform.
Thus, a large portion of Toutiao’s revenue comes from advertisement. According to an estimate, the company’s revenue grew fivefold becoming more than $869 million in the last year. But as it has invested more in original content such as video, it is unlikely to record a profit this year.
Bytedance (parent company for Bytedance) expects the platform to earn $4-7 billion from news feed ads in 2018. The CEO Zhang Yiming said his next goal would be achieving revenue of $10 billion by 2020.
Controversy: Part and parcel of new-age Chinese cos
In April, Toutiao was strongly criticised for its vulgar content by the government in China and was ordered to take down its eponymous news app Jinri Toutiao from app stores for three weeks. It had to shut down Neihan Duanzi, a social media platform where people often shared jokes, videos, and GIFs.
Later, Bytedance’s chief executive Zhang Yiming also issued a public apology and said, “Our product took the wrong path, and content appeared that was incommensurate with socialist core values. I am personally responsible for the punishments we have received.”
Apparently, the founder had earlier said that the content on the platform is run according to the demand of users and he has observed a precipitous decline in viewership of alternative content such as international current affairs, science and technology which was offered.
However, these controversies are of little consequence for multi-billion dollar platforms like Toutiao.
Amidst everything, Toutiao’s parent company Bytedance is reportedly considering a Hong Kong IPO that may value it at over $45 billion, according to a media report.
It isn’t clear how much Bytedance intends to raise, but it would join a rush of Chinese internet and technology startups going public. However, the company denied of such rumour and said that it doesn’t currently have plans for an IPO.
Learning for Indian tech media
The new-age media platforms in India are no different from the conventional old newspaper companies. Like its predecessor, they are still involved in disseminating news in the same old fashion just over a different platform, internet. There is no special use of technology in the ecosystem yet.
However, a Chinese platform NewsDog is doing wonders in India. It also works on a similar fashion like Toutiao and provides the most appropriate content to its target users.
The news aggregator platform claims to have over 50 million users in India. It recently raised $50 million from Chinese internet conglomerate Tencent. The funding amount is the highest so far in the Internet media industry.
Apart from this, there are other news aggregators such as Sequoia Capital-backed Dailyhunt and Tiger Global-funded Inshorts which are also leveraging technology to cater to users.
According to media reports, China’s Alibaba group is in talks to buy a minority stake in Dailyhunt.
However, if we talk about various other media platforms which are churning out original content on a daily basis, they haven’t been able to amass users anywhere close to the number Chinese news aggregators have gathered.