Ep. 67: TikTok’s Siblings: ByteDance’s Other Video Apps
Transcript:
(Y: Ying-Ying Lu; R: Rui Ma )
[0:00] Hey everyone! Some light housekeeping before we start. First of all, don’t forget to check out our upcoming events! If you missed our artificial intelligence in China webinar yesterday with Jeff Ding, don’t worry, we will be editing and releasing it as a podcast episode in the near future. But most of our events won’t be recorded, so you’ll just have to sign up for our mailing list at techbuzzchina.com to get notified! Don’t worry, we only send out emails weekly, if that.
We’re pretty low volume email people, our Extra Buzz newsletter is only every other week, which means you should definitely sign up for if you haven’t! But just in case you haven’t gotten around to it, don’t forget that we have another happy hour on China esports next Thursday, May 28, though, from 6-7PM PST. Our guest speaker is John Oliverius of the China Esports Business News Digest. Long time listeners should know that this is an area where China has been leading in many, many ways, so do join us for a fascinating discussion!
Our big announcement though is that we — and especially Rui — are working on a special project for the next few weeks so we’ll be taking a beak from our regular format. To be clear, we’re still publishing episodes, but they’ll be a little different from what we typically do and be more of an interview format. It will be a bit experimental for us, since we’re used to doing all of our own research and writing, but we hope you like it! Either way, let us know your feedback!
Yup, we love feedback …. and reviews. Another reminder that we’re still looking for more reviews on the Apple app store! Send us a screenshot of your review — and yes, past ones count as well — and we will gift you a free three month subscription to our Extra Buzz newsletter. Just e-mail us at rui@techbuzzchina.com. And now … onto the main program, which is once again, you guessed it, on the most highly valued tech startup in the world — Bytedance.
We started writing this episode before the big news announcement this week, which was Bytedance’s hiring of Kevin Mayer, previously the Head of Streaming at Disney, to become the company’s COO. More importantly though, Kevin will be the CEO of Tik Tok, which is a role that Zhang Yiming, Bytedance CEO, has been looking to fill for many months.
It is such a big hire for Bytedance, and really propels the company into the big leagues, if anyone was ever in doubt, that is. Well, we say that with a healthy sense of irony, because we kinda were — a year and a half ago we did an episode on Bytedance and decided that it was really richly valued at $75 Bn, because that meant, by our estimates, that the overseas business was already valued at $25 Bn. And at that time? That was really just Tik Tok, which wasn’t quite the phenomenon it is today. Nothing else was really working. Definitely not internationally.
Well, I wouldn’t give ourselves too much grief, because it really was a big — huge! — headline number at the time, and it was given by one of the most generous check-writers of all time, Softbank Vision Fund. But by now, it is pretty clear that Bytedance is no WeWork … there is definitely no imminent 16x writedown for this unicorn. As for write-up? Well, let us know what you think after hearing today’s episode on Bytedance’s many video efforts in China. Is this the next centacorn? $100 Bn company? According to Bloomberg, the private markets are already valuing it as such! But let us know what you think!
[4:21] Hi everyone! We are TechBuzz China by Pandaily, powered by the Sinica Podcast Network by SupChina!
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[5:51] Bytedance: The Super App Factory
For those of you just tuning in, this is not our first podcast on Bytedance. And by the looks of it, probably not our last. Hey, it’s a gargantuan company, so it takes a long time to talk about it! And I think we’ve still given more airtime to Tencent, especially WeChat, actually.
And Bytedance is also always pushing into new territory, so that generates a lot of interesting new opportunities for analysis, too. Like how last episode we talked about its initiatives in gaming and education, both very ambitious, especially its education unit, which is hiring 10,000 people this year alone. But those are new and upcoming things. Today, we’re going to talk about what Bytedance has been working on for a while — video. Yeah, if it’s not obvious by now, Bytedance is good at video. Very good. Now, everyone knows Douyin, AKA, Tik Tok. But do you know all the other hit apps that Bytedance has made? Xigua, Huoshan, Pipixia? If you’re thinking, say what? What is she talking about? Then this is the perfect episode for you, because these are 3 of the main other video apps that Bytedance has been busy making and promoting in China. And they’re not small.
Well, they’re small by Bytedance and China tech standards, but no, they’re not small, and they’ve been tasked with big missions. You know, in China, Bytedance’s nickname is Chaoji APP Gongchang, which means, Super App Factory.
Well let’s get on with it then, and see just how well the company lives up to that nickname!
[7:42] A Short Trip in the Way Back Machine
I’d like to start our first story with a little reminder. And that is, even if those of us in the West hadn’t really heard of it until Tik Tok burst onto the scene in late 2017. Bytedance has been around for far longer than that.
Yup, Bytedance was founded in 2012 and actually celebrated its eighth anniversary this March. As founder and CEO Zhang Yiming likes to tell it, it was a great time to be a founder working on mobile apps because of the explosion in smartphone ownership and usage in the few years after. Annualized user growth was over 17% every year, from 220mm in the beginning of 2012 to 847mm in mid 2019. Hard to beat that timing.
Well, he wasn’t the only one to see that this huge tide was going to lift a lot of boats, but he got lucky fast. We all know now about his first pot of gold, 今日头条, or Toutiao, as the 115mm DAU news app is usually referred to in English. Toutiao was launched just 5 months after founding.
What you probably didn’t know was that Neihanduanzi, an app centered around funny memes, was launched even earlier than that, in March 2012. Actually the same month the company was officially founded. And we bring it up because we’ll also be talking about it more later today.
And … if the app sounds familiar it’s because we covered its shutdown for our very first episode in April 2018! That’s right. It’s literally the very first thing we ever talked about on Tech Buzz. That was Bytedance being forced by the government to close down Neihanduanzi. We have so much yuanfen (缘分) with Bytedance.
Only back then we referred to the entire company as Toutiao, because actually pretty much everyone in China tech did at the time. Really. Do a search and see for yourself. Bytedance wasn’t known for too much more beyond these two apps at the time, and Toutiao was the much bigger deal and could basically describe the whole company. I mean, I can’t even remember at this point if I knew it was called Bytedance or not. Not important. The point is, you see how even in its very first six months of existence Bytedance had launched not one, but two apps that would become very popular in the following years. That’s right, from the very beginning, it was willing to experiment and expand.
This will become really obvious from the rest of the episode, which is really all about how they’re not content to just take home their one massive video win in Douyin and live off of that. Nope, they’re going after everything in video. Absolutely everything. Yup. So let’s go forward in time a bit and take a look at what they’ve done. Let’s take a look at Tik Tok’s siblings. Because, if it isn’t obvious by now, Bytedance has many children.
[10:55] Tik Tok’s Older Brother: Xigua Video
So Douyin, AKA domestic Chinese Tik Tok, came online in September 2016. But four months before that, in May of 2016, Bytedance’s star news app, Toutiao, launched a new video functionality simply called 头条视频, or Toutiao Video. A little over a year later, when it had broken 10mm DAU, it was “upgraded” into a separate app and renamed Xigua Video. 10mm DAU and 100mm users, according to the company. Now, that would be very impressive if it were completely standalone, but as a feature of one of the top consumer apps of the time, Toutiao, not so much. From alleged leaked documents, Toutiao at this time had already reached 100mm DAU, so it wasn’t too crazy that a frontpage function was engaging 10% of the daily users. The story goes that the guy in charge of Toutiao Video, Zhang Nan (张楠), not to be confused with the female Zhang Nan Kelly Zhang, CEO of Douyin, who has the exact same name, characters and all, was so convinced that China was going to come up with its own YouTube, and that this thing he was working on could be it, that he successfully convinced the management this needed to be its own thing.
We’ll be able to confirm that one day, I’m sure, but for now, just remember this, Xigua, from the very beginning, was meant to be a Chinese YouTube. So congrats here to FantasyManDan who answered correctly when I asked on Twitter who is the other main contender for the title of Chinese YouTube other than Bilibili that is. It is, as you now know, Xigua Video.
And if you go on ixigua.com (that’s spelled i-x-i-g-u-a dot com), or you can download the app, but either way, you’ll see what we mean. The middle portion of the website should give you a list of what we call PUGC videos — that is, professional user generated content. These are typically a few minutes to tens of minutes long, but they aren’t by major studios or mainstream media. They’re by users, although often these users have become quite professional at video-making and might be doing it for a living or even with staff. In other words, very much like YouTube content.
Right. So let’s make sure we’re on the same page here. There are generally three ways to slice the creator pie, UGC, PGC, and PUGC. They stand for, you’ve guessed it, user generated content, professionally generated content, and professional user generated content. UGC is basically people making stuffs for fun, like many of us do. And how most so-called TikTok stars actually got started. PGC is done by professionals. Like Netflix content. I’d categorize us here at Tech Buzz as PUGC.
[14:10] And in China, for a long time, PGC dominated. Especially in the early years when the overwhelming majority of internet users simply wanted to watch PGC, and rights were super cheap to acquire. If you bothered to acquire them that is, because you could always just straight up pirate. I mean, PGC is still a big deal, Youku, iQiyi, Tencent Video, etc. are all still doing very well, but in terms of average user time spent, the short video category did exceed it sometime in 2018. Back in 2016 though, when you’re the boy Zhang Nan, with so much competition already in PGC, and short video not yet a thing, betting your career on PUGC was really not a bad choice. Especially when you were being incubated from “within” Toutiao.
The boy Zhang Nan, by the way, is one of China’s first generation of growth hackers, so he was very early on the train of using data to inform how he thought about marketing and growing the business. And pretty soon, like we said, Xigua had a very respectable trajectory. By early 2018, it was at almost 30mm DAU, but the bad news was that it had already been superseded by little brother Douyin, who was at this point already at over 43mm.
That’s because fundamentally, right, these are really not at all the same thing. Douyin, at this time, was still only for 15-second videos. It wouldn’t fully open up to longer videos until 2019. Xigua, obviously, never had this restriction. And in fact, according to the 2018 金秒奖, or The Best Moment award organized by Xigua, the average length of videos with more than 1mm views on its platform was 4 minutes.
Think about how much content needs to go into 4 minutes and how high of a barrier that is for most creators, even today. Which might explain why despite a lot of effort, Xigua only ended up with 50mm DAU in 2019. That’s right. After 4 years, when Douyin was getting close to 400mm DAU, Xigua was only enjoying a fraction of the traffic of its younger sibling.
I mean, this was pretty obvious well before 2019. In 2018, Xigua had already realized this problem, and was itching to try new things, like … longform content. We didn’t cover this on Tech Buzz when it was announced, but it was a big deal at the time. You see, in August 2018, Xigua announced that it was going to pour over $500mm into original content for its platform, including interactive, mobile-first gameshows that were going to be at least partially decided by audience input.
Sounds clever, right? Well, we don’t know exactly why, but it was not successful. I’m pretty sure that half-a-billion dollars never got spent in full. Not on content creation anyway. I mean, if you try to search for Xigua’s original content on Douban, one of China’s top review sites, you won’t even see a single user rating. I think Xigua figured out pretty quickly that creating content is just not the same as distributing or publishing it. Which is why, of course, Xigua’s recent efforts have mostly been on acquiring or licensing content, instead of trying to make it from scratch.
Yeah, not everyone can make hit original content like Netflix, and even Netflix is still mostly licensed content! Which is why Xigua has been buying up rights for the last two years — for a bunch of classic TV shows and top animations, as well as foreign content like BBC. It’s not given up on original content, of course, but it’s gotten smarter about how to go about that.
Remember how everyone made a big deal out of Bytedance acquiring the rights to that one comedy movie, Lost in Russia, which was supposed to hit theatres on Chinese New Year’s this year, but couldn’t because of Covid-19. As we explained in Episode 60, the $100mm that Bytedance paid wasn’t just for the movie, that movie wasn’t even projected to do very well. It was actually part of a longer, ongoing relationship with the studio behind the movie and all their future projects for the next two years.
[18:49] And also as we explained in the episode, it worked. Kind of. Xigua shot to the top of the free apps chart on iOS for a week. In February, it hit over 50mm DAUs. If you go to Xigua’s appstore download page or its webpage nowadays, you’ll see that longform, professionally produced video is prominently featured on top. In fact, its current slogan is 万部大片随心看, which translates to “ten thousand big flicks, watch as you like.”
If we go back to interviews of Zhang Nan from two years ago when he announced the strategy about creating content you’ll see that what he actually said was that short video was a great way to showcase and convert users to longform video, Duan dai chang (短带长). That is, he observed the following user behavior: people would watch promotional short videos — maybe film clips or something like that — and then go on to search for the film or TV series and watch it in its entirety. If you’re Bytedance, and you’re fighting for people to stay on your platform, you obviously don’t want to stoke people’s interest in something and have them spend the next two hours, or even fifty hours if it’s a TV series, on another platform like iQiyi.
And it’s not just time, it’s also money. The willingness of Chinese consumers to spend money on content has increased exponentially over the years. Both iQiyi and Tencent Video hit 100mm paying subscribers in 2019, making them the second and third-largest paid video-streaming services in the world after Netflix. It’s important to note though that both are still running huge losses as well. But for Bytedance, it could just be that this is just not a category it can concede without a fight, especially when the field is pretty evenly distributed between the BAT.
No, longform video content is way too core to the consumer internet content experience for Bytedance to give it up. And don’t think it’s given up on PUGC either, which was its initial intention. Astute Chinese netizens have long noted that Xigua has been luring Bilibili creators to go onto their platform instead, promising greater exposure, higher revenues, etc.
And lots of Bilibili up主, as soon as they were no longer under exclusivity, have gone over, although to mixed success. There has been some flow the other way too, so it’s not like Xigua doesn’t have any home-grown talent, but Bilibili still has the far deeper talent pool. And that probably won’t change any time in the immediate future. Fast forward a few years though, who knows? It’s still a very dynamic space.
[21:46] Meanwhile, Xigua has other enemies to worry about. WeChat has banned Xigua videos since March 2018. Lest you think that was just an unwarranted jerk move, it did also ban Tencent Weishi, its own sister product, at the time, mainly because of new rules on online video. But unlike Weishi, Xigua and Douyin — and Alibaba products, of course — have remained difficult to access from within WeChat. Don’t worry though, Bytedance doesn’t intend to let Tencent get away with it. There have been plenty of lawsuits filed. In both directions.
I’d say that Xigua’s prospects are still not clear at this point. It’s tried a bunch of experiments, like launching and recently re-launching a livestreaming quiz show, yes, much like the now-defunct HQTrivia. And while, yes, it is a 50mm DAU app now, some third party stats show that its retention is pretty poor. Douyin 30-day retention is nearly 30% but Xigua is hovering at 12%. Again, the products aren’t comparable but the team must feel some pressure, especially when the market in China for users and user time is so competitive, and so expensive!
And on top of all that, this March, Zhang Nan was named to be head of 飞书, Bytedance’s enterprise messaging and collaboration software product, AKA its Slack clone, English name Lark. He will be reporting to the original head. He is probably going to be focusing on globalizing Bytedance along with CEO Zhang Yiming. Good for Zhang Nan I guess, but that’s also a highly competitive space, and this does introduce some discontinuity for Xigua. But again, after having the same team fiddle with it for four years, maybe what Xigua needs is some new blood. Who knows? We’ll see.
[23:55] The Cannibalized Sibling: Huoshan AKA Vigo AKA Flipagram
OK, so 2020 opened up with a big headline in the Chinese short video market, and that was, Bytedance’s Huoshan Short Video was going to get combined with its much bigger sibling, Douyin. The products would remain separate for now — that is, they are still two different apps, but eventually they were going to be merged somehow, or at least be more inter-operable. But meanwhile, Huoshan was going to be renamed: Douyin: Huoshan Version, and its logo changed to a Douyin logo with a huoshan, the Chinese word for volcano, on the bottom.
And if this is the first time you’ve heard of Huoshan, don’t worry, you wouldn’t be alone. Even lots of Chinese people haven’t heard of it. There are two main reasons for that — one, it’s not that big, not by Chinese standards anyway. Yes, like Xigua, it is a 50mm DAU app, but in China, you have to be at 100mm DAU to be really considered a super big app. But the second reason, and probably the more important one, is that it started off targeting rural China for its users, we are talking about past-fifth-ring, below third-tier city China.
No wonder then that basically everyone refers to Huoshan as Bytedance’s answer to Kuaishou, the original short video app, which also started off really appealing to the 1bn people outside of rich, urban, coastal China. And while you can’t download the app if you’re outside of China, you can get some idea of the popular content on there by going on their website, and today, when we looked, the top ranking video was this young guy in a doctor’s coat making a 40-second rhyme about what herbs to put in your summer tea. Goji berries, what else?
As one Zhihu post put it quite succinctly, Huoshan is for slightly older, less hip people. Douyin is for playing around, whereas Huoshan is for living a better life. OK, that’s an exaggeration, because Huoshan definitely has a lot of stupid funny videos as well, but it does try to promote “useful” videos. I mean, that’s literally one of the leaderboards they keep track of.
OK, I watched some of these and I did not think they were at all useful, or even made much sense, but I am not the target audience. You see, Huoshan launched in April 2016, earlier than Douyin, earlier than Xigua, and it was specifically meant for rural China. Very logical, when you consider that Kuaishou was making waves in China tech around this time, people were really starting to look at rural China seriously, and 2016 was the year of video, as everyone got into livestreaming. If you don’t remember all that, go back and listen to our Episode 55 on Kuaishou, which explains all of this in detail. The point is, Bytedance took this all very, very seriously, and Huoshan was even more 接地气, or “down to earth,” than Kuaishou, in many ways. For example, they did a major product launch from the backyard of one of their farmer influencers. They made it very clear that they were looking for content just like this — people sharing their ordinary lives: capturing fish, selling fruit, cutting hair, what have you.
And they were willing to pay people to create it. Huoshan very early on allowed for tipping in-app through virtual currencies, which was something all the livestreaming platforms already did, but in order to “cold start” the ecosystem, in 2017, they announced a $150mm subsidy to incentivize creators to create. So as long as your short video fit Huoshan’s quality and originality criteria, you could get paid. It wouldn’t be a lot of money, but for rural China, even small subsidies of a few dollars were meaningful, which is why, even today, some people remember Huoshan as “oh, that video app where you get paid for uploading videos.”
All seemingly good intentions, but in 2018, both Kuaishou and Huoshan got called out by state-owned media CCTV for having “inappropriate content” on their platforms. That content? Videos glorifying teenage motherhood. Now, this was a big deal. In fact, the apps were taken off of appstores. But after public apologies and promises to better moderate their content, the apps were both allowed back. We highlight this because later, we will talk about an app that wasn’t quite so lucky.
Huoshan, by the way, does exist internationally. It’s known as Vigo Video. Actually, it used to be Flipagram, yes, remember Flipagram, video creation app that was once considered a “serious threat to Instagram”? It was sold to Bytedance at the introduction of Sequoia, their mutual investor, for an undisclosed amount, and apparently rebranded as Vigo. Anyway, you can download it for yourself to see that it’s not that different from Tik Tok — except it has barely anyone on it. The main difference is that here there is a Flames function, redeemable for cash, just like in Huoshan, or should I say, 抖音火山版. I scrolled through a bunch of creators and finally found a few with Flames next to their name, but all of them were in developing countries, none of them in the US that I could find. So there you go, I guess they’ve kept that consistent!
[30:00] Faster and Lighter: Douyin and Huoshan Super Speedy Versions
Almost didn’t include this one, because it’s kind of considered to be part of Douyin. I mean, ever since Kuaishou launched 快手极速版 at the end of July 2019, or Kuaishou Super Speedy Version, available only for the Android and targeted at lower-end devices, Douyin also launched 抖音极速版 and 火山极速版 just a month or so later. If it’s not obvious by now, Bytedance does not mind copying others when they see something good. These Super Speedy versions are indeed speedier — in that they are usually smaller than the “original” app, 抖音极速版 is just 27Mb, for example, and 火山极速版 is just 11Mb. But that isn’t the point. The point is that they pay users for usage just like Qutoutiao. Qutoutiao, if you remember, is publicly listed so you can go look at their prospectus but basically, they pay people money — very little money, like well less than a dollar — but yes you do get paid to spend time in their news app, which is itself a Toutiao clone. You would think this is silly, but again, there are large portions of China — rural China — where the people have a lot of time, but very little money, and this is something they’re interested in doing. How interested? Well, by October, 3 months after launching, Kuaishou was already looking at 25mm DAU for its Super Speedy Version. And by this February, as we know, Kuaishou announced that it had reached its total 300mm DAU goal, in which Super Speedy played a large part, like 60mm worth, probably.
They didn’t break it down, but that would have to be in the neighborhood of how big Super Speedy needed to be in order for Kuaishou to reach that goal. In case you didn’t notice, Kuaishou is including the Super Speedy app as part of its total DAU. I think that is fair, because really these guys are the same app just with different user engagement schemes, and it’s also what we expect Bytedance to be doing as well. So, when you see Douyin and Huoshan numbers, unless otherwise stated, it’s pretty safe to assume that they’re summing in the Super Speedy versions in there already.
Versus Kuaishou though, Bytedance’s Super Speedy Versions don’t seem to be doing as well. One third-party data service shows that the DAU in January for 抖音极速版 was just 6mm, stagnant from a few months earlier. It’s not clear as to why. The mechanisms are very similar. And while, yes, you can make some money actually using the app, and you can get lucky and get a $15 hongbao, the real and consistent money — well, if you can call $6 real money — is in inviting your friends. But that $6? It comes in small chunks, only if your friend finishes certain tasks in the app. I know there are many of you who think this kind of business model is ridiculous and doesn’t demonstrate any kind of true product-market fit. I am a little more lenient than that, but I question its sustainability too. So does state media, well state media hasn’t totally slammed it, but definitely takes a skeptical tone. I mean after the initial downloads though, will the usage continue? Or are you attracting a bunch of zombie users? Even fake users? Who knows? We’ll see.
Yeah, but for now, the March 2020 data shows that Douyin Super Speedy Version is behind Kuaishou’s version, and declining rather than growing, which is odd given this was still pandemic season, when everyone was under lockdown. But Huoshan Super Speedy doesn’t even make it into the Top 10 short video apps.
I think this is coming as a surprise to people, but really, should it be? Douyin was initially known for catering to a higher-end audience — in fact it was known for having 40% of its users signing on from Apple devices — and its content is still quite different from Kuaishou. There’s a lot of overlap, yes, but they’re still pretty readily distinguishable from each other, at least for their top-ranked stars. And if there’s anything we’ve learned over the past few years, it’s that rural China is just very, very different from urban China.
[35:00] Pipixia: Replacing Lost Child Neihanduanzi
And now we’re back to the beginning. Of not just Bytedance, but Tech Buzz! Yes, remember we said that our very first episode was about how Bytedance had to shut down Neihanduanzi (内涵段子), their jokes and funny memes app? Well, guess what, it was also one of the first — possibly the first — app that Bytedance ever launched!
And why are we including it in this episode? Well, it’s because even though it didn’t begin that way, by the time it was shut down, it was mostly short video and livestreaming content. And that’s actually why it got in trouble, because of really lowbrow, basically pornographic stuff. But impressively, it had accumulated over 200mm users. So, no, you couldn’t defy the government, but with that kind of scale? Of course Zhang Yiming would try to use every method to try to save it.
It’s still unclear exactly why the app was shut down permanently versus most of the time, it’s just taken down temporarily, like we just mentioned happened to Huoshan, which actually happened at around the same time, just one week earlier. Toutiao itself was censored as well. There are many theories, of course, including ones that pointed out the very active offline community aspect of Neihanduanzi, but whatever it was, the authorities apparently didn’t care that Bytedance revived it under another name.
Yeah, which makes me wonder, was it the name they had a problem with? Hah. Can’t be, but still. Odd. I mean the takedown was in April 2018, but by June, the app Pipixia (皮皮虾), which means Mantis Shrimp, was already appearing in certain appstores in China. By August, Bytedance had confirmed that this was indeed their product. But the thing that made it obvious that these were really the same app was that you could log into Pipixia using your Neihanduanzi account. In fact, when you did that, it would say, you are the “Nth” golden shrimp to return home. Welcome! And pretty much everything else was similar as well. By the way, you can download Pipixia from the appstore. It’s not regionally restricted. In its current iteration, it reminds me of the Reddit app. That is, there is a feed when you log in, but you can also quickly go into a specific category or forum, and browse content that way. It’s not by trending hashtags, but actual topics, like “documentary lovers,” or “car fanatics,” or things like that.
The name itself comes from a meme that means “to play,” so most of the content is indeed very light-hearted. And the community aspect from the Duanzi days survived. The comments section is pretty active and there’s a good amount of interactivity. But still, as of Q4 2019, it fell out of the top 10 in terms of short video apps in China. Right before it did that, the DAU number we can find for it is only about 6mm.
That’s literally less than 2% of Douyin’s scale, but hey, we included it today not only because its birth story is interesting, but to reiterate the fact that Bytedance really does have a very large portfolio of apps, just 4 in video alone, and we aren’t even including tangential ones like Viamaker, which is Rui’s new favorite video editing app.
What did we tell you? Bytedance, super app factory.
[38:58] Wow, OK, so that ended up being a pretty long explanation of Bytedance’s video apps, and to be honest, we’re not sure we’ve got them all. I mean, we’re always finding out that they’re registering this and that company and launching this and that app. You don’t pay attention for a week, and something new happens with this company.
We’re pretty sure we got all the noteworthy ones though. And like we’ve said before, now that business data is a lot more transparent in China, reporters are pretty good about catching new launches. It’s nothing like how it was before. But to recap … we spent the bulk of this episode on Xigua, which means watermelon in Chinese, and it is Bytedance’s longform video app.
It started off trying to be China’s YouTube, which means going after PUGC content of more than a few minutes long, not the 15-second videos that initially made Douyin popular, but it’s struggled to be anywhere close to Douyin’s scale, and has begun expanding into original longform content creation two years ago. It tried to make content on its own, which wasn’t successful, and has since then been acquiring content, which might be working out better, but hasn’t resulted in explosive growth or anything.
It’s still at 50mm DAU or so, after 4 years, which is no small feat, but considering that it was incubated from within Toutiao and shares in the vast resources of the large Bytedance network, I guess some of us expected better. Nonetheless, aside from Bilibili, Xigua really is a strong contender for the title of China’s YouTube, not least because you can monetize your videos via the Toutiao advertising network, that’s very, very similar to how YouTube works.
The Xigua versus Bilibili battle, by the way, will probably be ongoing, because no way Bytedance gives up the longform video market, there’s just too much to lose. China’s YouTube is up for grabs. And even China’s Netflix isn’t that settled, necessarily. Plus, for Bytedance there’s that natural conversion from watching clips of something to then going to watch the actual film or TV series.
We then talked about Huoshan, recently renamed Douyin Huoshan Version, and soon to be merged with Douyin itself, and about how that was really Bytedance’s answer to Kuaishou, that is, it’s a short video and livestreaming app made for especially rural China. It was always branded as facing those who lived in third-tier and below cities, and it has a tipping function that made it really easy for people to get paid for uploading content. It’s not a lot of money, but enough to matter to this audience.
And then of course, we talked about the two Super Speedy Versions, 极速版, of Douyin and Huoshan, that take the money-making thing to an extreme and pay you for using the app, just like the app they copied, Kuaishou Super Speedy Version. For whatever reason though, Bytedance’s attempts have been less successful than Kuaishou’s, even though on the surface, they seem every bit as 接地气, or down to earth. Either way, we aren’t big fans of this model, even though we understand that it does what it’s supposed to do, which is to get users in the door. But what up in the long term? We can’t see this being some sustainable strategy. You shouldn’t have to pay your users to use your product.
And then finally, we told you about Pipixia, a revival of Bytedance’s banned jokes and memes app, Neihanduanzi, that we talked about on the very first episode of Tech Buzz! Before it got permanently shut down, Neihanduanzi claimed 200mm users, although we don’t know how that translates in terms of active users. Anyway, Pipixia still has a few million DAU today, so it’s not nothing, but it’s very, very small compared to its siblings.
So what do you think, guys? Were you aware of Bytedance’s extensive video strategy before this? Do you think it makes sense? Do you think it’s too scattered and unfocused, or do you think it’s thoughtful and comprehensive? Do you think Xigua will win versus Bilibili for the title of China’s YouTube? So many questions! Let us know what you think!
[43:29] OK, that’s all for this week folks! Thanks for listening and don’t forget to write us that review for your free Extra Buzz subscription. Have any questions? Email us! We really enjoyed putting this together, and we are always open to any comments or suggestions. You can find us on twitter at thepandaily, at techbuzzchina, and my personal Twitter account is RUIMA.
And my Twitter is spelled GINYGINY. Tech Buzz China by Pandaily is powered by the Sinica Podcast Network on SupChina. Pandaily.com is an English language site that tells you “everything about China’s innovation.” Our producers are Caiwei Chen and Kaiser Kuo. Thank you for listening!