High-dimensional low-dimensional, this is the eternal topic of the Internet
” Finally, I got back to the IM market. In 2012, I had the opportunity to grab the market with QQ. As a result, the mobile Internet disrupted the rhythm. In 7 years, there is another chance to prove himself.”
August 14, after the release of the second quarter earnings report of the 2019 fiscal year, the chairman and acting CEO Li Xueling used such a circle of friends to describe the regrets and opportunities of YY in the IM market.
Li Xueling’s circle of friends
Today, YY’s re-entry into the IM market is an instant messaging product, imo, which has 211.9 billion monthly jobs in the second quarter of this year. Seven years ago, YY missed the opportunity of voice communication. At that time, YY voice was a big one with 400 million registered users. QQ had restarted QQ TALK for defense. But in the end, the rise of WeChat, which can be free of voice, kills the possibility of YY voice.
YY is obsessed with doing social products. This is because the logic behind the development of the Internet is that high-dimensional (high-retention) products like QQ and WeChat can last forever, while low-dimensional (low retention) The product life cycle is very short. However, imo can learn to follow the path of WeChat, but also need to explore and explore.
Continuous exploration
YY voice missed the opportunity to challenge QQ, YY company did not give up on this, but has been creating social possibilities through the differentiation of time, space and other dimensions.
“Micro Club” is a social attempt by YY overseas.
In July and August 2014, YY launched the “Micro Club” Android version and iOS version. Micro-Conference is an instant messaging product that can send voice, SMS, video, pictures and text. Although similar to WeChat, it is more of a benchmark imo and WhatsApp. At the end of March of the following year, YY announced the spin-off of the micro-conference business and injected it into Bigo Te through a connected transaction.Chnology Pte.Limited(BIGO). BIGO was incorporated in Singapore in 2014 and can be understood as a subsidiary of YY established to develop overseas social products.
However, the micro-will that wants to avoid the WeChat competition is still awkward. In desperation, BIGO went to live broadcast product Bigo Live, a YY overseas version.
Bigo Live was launched in March 2016. Unlike YY, it is located in YY+虎牙+陌陌, which is a combination of live entertainment, live games and social live broadcasts. Two years later, its registered users broke through the 200 million mark. BIGO Vice President James said in an exclusive interview recently that the product’s pan-entertainment content, small granularity, grouped network relationship chain, and relationship chain precipitation are the exploration from the community to the society.
After the live broadcast, BIGO has a global user base, a team, a diverse range of content and market capabilities, so Starting the acquisition of imo in the summer of 2017. In August 2017, BIGO hatched the short video product Likee.
BIGO product matrix formation, whether it is live broadcast, short video or acquisition of communication products, is actually around the goal of social. For YY, the acquisition of BIGO allows it to get tickets to the IM market again. By the second quarter of this year, imo mobile terminal reached 211.9 million monthly, accounting for nearly half of YY’s global life of 433.5 million.
“Can’t do it in the mainland market, we do it overseas, we can’t do it overseas well, we buy one.”James describes the cycle of BIGO’s socialization in recent years.
From Weihui to imo, this is not a company strategy that YY can plan from the beginning, but it is step by step in reality, but it seems more like it now.
High dimensional low dimension
In the case of whether to buy BIGO or let it stand alone, YY has been hesitant for a long time. A person familiar with the matter said, “I was still hesitant in November last year, and decided before and after the Spring Festival.”
For YY, the live broadcast industry is slowing down andThe impact of short videos has already had a big impact on it. In the fourth quarter of 2018, YY net revenue was 4.641 billion yuan, up 28.0% year-on-year; net profit was 684 million yuan, down 8% year-on-year. In the same period, Huya’s revenue and net profit maintained 103.1% and 1900.4% year-on-year growth, and its market value also exceeded YY many times, which is also a kind of “stimulus” for YY.
YY needs new business to boost revenue, and more needs social to increase resistance. According to James, BIGO’s revenue will reach $1 billion by the end of the year, achieving breakeven. At the same time, BIGO’s revenue is still growing at a high rate, and it is expected that the proportion of YY’s revenue will increase significantly next year.
In addition, although Bigo Live is already the best in the live broadcast products, but with reference to the development of YY in China, when the user dividend disappears, users will encounter bottlenecks in user growth, and even net profit will decline. Looking forward, the YY voice, which was once in the limelight, has slowly declined.
Overall, BIGO and YY have always been obsessed with socializing, which is determined by their situation.
imo interface
The content product users are bigger and the company is insecure. The only thing that can cross the cycle is social products. James believes that from QQ to WeChat, Tencent can always stand still because it has taken the deepest and highest-dimensional users from the beginning. It has seized the highest step in Internet products and is the commanding height of the Internet. “The higher the level of retention, the lower the level of retention, so the higher the level, the lower the dimension. This is the eternal topic of the Internet.”
YY Voice was once a challenger to Tencent, who had considered the $150 million acquisition of the former and failed. At that time, in order to fight against YY voice QQ, QQ TALK was restarted. But in the end Tencent ended the war that had never begun with a higher-dimensional socialization.
History repeats itself again. Bytes has become a new challenger for Tencent, and Tencent has considered investment/acquisition for it, still unsuccessful. In order to prevent the rise of the vibrato, Tencent restarted the microvision. In addition, WeChat video is also launched, open micro-view video sharing in the circle of friends, allowing fast video sharing to watch a video. Tencent once again launched a high-dimensional war against low-dimensional, but the result is to be determined.
Bytes are naturally anxious. In the first half of this year, it has released acquaintance video social products, flashing and IM, interest community products flying talk, mostly from low latitude, weak competition barriers, but the two products are not prominent. Judging from the case of YY voice, whether the bytebeat can reverse the battle with the vibrato, the key is to have the protection of the big network of the social relationship chain.
Compared with short videos and live broadcasts, it is clear that adding short videos and live broadcasts to social products will be more lethal. After several years of exploration, YY hopes to embark on a similar path to WeChat through imo, and can crush low-dimensional products through high-dimensional products.
Two camps
For YY, who knows the fierce competition in the domestic market, it has already shifted its main battlefield overseas. Next, imo will be the focus of development and the core of the continuous reinforcement of barriers. But by acquiring an imo, whether it can build a social empire like Tencent is still full of uncertainty.
The first problem is that imo is learning WeChat, which may affect its innovation. James told that before the acquisition of imo, the internal meeting had discussed its future development path, the most talked about how to learn WeChat. And then, BIGO still wants to imo-meal . This is because WeChat has a unique aspect in many ideas, designs and understanding of people, and this is also common overseas.
At present, in addition to incorporating short videos in imo, BIGO also plans to open a circle of friends, groups, games, live broadcasts and other functions for imo. From the product architecture, we are completely referring to WeChat. In Southeast Asia, a mechat, a social product that plagiarizes WeChat, has reached tens of millions of days, which may also give imo confidence. In comparison, mechat’s overall team is not strong, and BIGO has one headquarters and four centers around the world, and currently has more than 800 overseas employees.
Secondly, the complexity of the problems faced by imo. Because it is a multi-country, multi-regional product, it has its own characteristics, such as Indians in the Middle East, Pakistanis in the UK, or CIS people in Europe, there will be natives, immigrants or expatriates. The factor is inside. Therefore, the diversified dimensions of the country, language, data, users, content, etc., also determine its complexity. In comparison, the comprehensive environment faced by WeChat is simpler.
Overseas, the ceiling of a social product may be determined by Facebook. Chinese Internet companies will face three “big mountains” of Apple, Google and Facebook, and they will have distribution channels and traffic. Especially Facebook and Instagram,60% of mainstream traffic comes from these two platforms, which is not circumvented by any social product.
“The chance to become a Facebook is basically gone, don’t even think about it,”James said, “The most realistic of the first stage is that Three big mountains can live well and become regional leaders.”
But in any case, BIGO seems to have thought about the way back for imo. When YY acquired BIGO, it had done various preparations and deductions internally, such as comprehensive domestic and international capital markets and domestic and international Internet competition.
From the perspective of the domestic Internet situation, the content, user, and traffic disputes have gradually formed Internet companies into two camps. Tencent and fast-handed, more and more, Jingdong, and the US have been highly aligned. Recently, Baidu, who has joined hands to invest in knowing, may join the camp in the future, and the two companies have been highly aligned as early as the 3Q war; It is very likely that the beating will be in alliance with Ali. The 7 billion yuan cooperation year frame signed by Chaoyin and Taobao is only the beginning.
The two camps further divide the domestic market, which will leave a development window for overseas BIGO. Take the vibrato and the fast hand, although both of them are increasing their investment in overseas markets, the fierce competition in domestic short video makes them have no more energy to allocate overseas. For YY, they have always cooperated with AT, and may be able to help when the giant related business goes out to sea.
WeChat’s international business is not doing very well, byte hopping, YY have seen the opportunity. If imo becomes an important social product overseas by learning WeChat, it will definitely attract the attention of the giants. In addition, YY, who lived in the shadow of Tencent and confronted Tencent, actually established a certain connection through Tencent’s investment relationship with Tiger’s teeth. However, this is only a possibility in a complex relationship. After all, the alliance of the giants is changing with time.
The title map is provided by BIGO