Tudou is the “Chinese YouTube ”. It is, however, a disservice to make such a comparison. While they are similar kinds of business, there are differences between the two. Currently, it is most certainly the predominant video user site in China (capturing approximately 53% of all user-share). Tudou was launched on 15th April 2005. The Shanghai-based service utilizes Adobe Flash technology publishing approximately 20,000 new videos daily. Content ranges from amateur video-blogging and original videos to films and television clips; additionally it supports music videos. It reaches nearly 10m users each day.
While Chinese is still not the top language of the internet, it is growing. According to internet world stats English is still the top language at 29.4% of users. Chinese is the second at 18.9% of users, and Spanish third at 8.5% of users. Other languages level-out between 3 and 6 percent after that. However, China has recently overtaken the U.S. as the largest internet population in the world.
See below for a fantastic video giving a solid background on Tudou, where it came from and where its going.
MIPCOM hosted Gary Wang, the founder and CEO of Tudou.com. In his Keynote Speech yesterday he stated that Tudou’s origins “stemmed from wanting to open up the Chinese market. TV is off limits, too many regulations. If you remove TV you don’t have a large market to play with. So I thought, how do we bring interesting content to the huge audience in china? At the time there were only 20m users of broadband, but it since has grown. We wanted to build a site that made media available to the Chinese people.”
Considering the strict censorship and regulation that takes place with Chinese television, some of the desired long-form video is only available online. As a consequence more long-form video is watched on Tudou as compared vs. Western YouTube users who predominantly watch short-form clips. Users see Tudou as an alternative to TV (which Wang describes as “background, ambient”). It is important to note, however, that even online is attacked by regulators. [ More on Censorship and SARFT issue below ]
Wang also mentions that Tudou audiences predominantly watch Asian content even though there is a plethora of international long-form uploaded as well. Users search for 90% Chinese.
He attributes this to ‘western content’ not being exposed to the Chinese people and within Asian broadcast channels, resulting in an unawareness of quality Western programming. “Asian people can relate more strongly with their own people and culture.”
Tudou Funding:
Like many technology startups, Tudou was started on a shoestring with a raw technology team, practically in a garage. It was initially self-financed at about $100,000, then in 2005 raised a $500,000 seed round. Its first major funding round was in 2006 for $8.5 million from IDG China, Granite Global Ventures , and JAFCO Asia . Tudou’s second funding was in early 2007 for $19 million and was led by Boston-based General Catalyst Partners and Shanghai-based Capital Today , with other existing investors participating. Its most recent funding was on April 28, 2008 for $57 million from existing investors IDG Technology Venture Investment (IDGVC), Granite Global Ventures and General Catalyst Partners , and also included a member of the Rockefeller family.
One month ago Gary Wang and his team also launched Heidou (which means black bean). Heidou is a HIgh-Definition channel featuring long-form broadcast content - with less interactivity than on Tudou and certainly more flair. He says we can compare it to Hulu . “Heidou is professional, exclusive, and videos are of extremely high quality (mp4) : it is mimicking the TV experience but in a stronger, still more interactive way”. See here for article on: " Tudou: HD Brings in the Bucks"
Wang also addressed questions of Censorship and Piracy in China. Everything that is uploaded to TV and the internet must be approved by SARFT (the State Administration of Radio, Film, and Television ). Wang says he deals with this by finding “a local partner who knows how to navigate this space. Censorship is part of life. In China you have to be careful, but you have to deal with it and move on.”
He took a moment to describe the mechanism of censorship in China and Tudou. “Tudou is the same with Youtube in terms of how you use it. The only difference is that we have a 30 minute gap between the time you upload your video and broadcast it. We have trained college graduates who check videos 24 hours a day. We have nearly 100% compliance.” If you want to read up on this issue, go here and here and here .
Intellectual rights he describes as “a headache. We work with MPA and other organizations looking to design their approach to China: we worked on a joint ad campaign to promote UGC and protect IPR in ‘07; an industry wide effort to sign MOY with MPA companies in 08; launching fast-track deletion mechanisms and log-in traffic marking tools for partners.”
Piracy on the other hand poses a threat, but not quite the same threat that it does in Europe and North America. “Look at the music industry…In China, CD sales have never made it big. In China people have learned to get around piracy and deal with the cards they have been dealt. Ours is advertising based content, so we don’t work with pay-per view – it’s free. Users are asking for it.”
When asked about social networking sites he commented that it is growing. It began in China with instant messaging and online gaming. But now that everyone is “multi-tasking…from gaming to video to casual games to IM” social networking and user communities are developing, quite fast! “QQ is the biggest social network… a couple hundred million users on QQ. Then there are smaller players as well but they are very small – though the environment is changing and as new users come on board they can take on new sites and build them out. So it’s a fluid market.”
Wang concluded the session with discussion about how they are advertising. He mentioned pre rolls, multimedia, full screen, and how leading international brands are coming onboard to support content. He also responded to an audience question about mobile technology and how, with 250m internet users and 550m mobile users in China, the future of mobile technology looks to be a “huge phenomenon”. But is Online killing TV? Perhaps in China it really is…minus a few bumps along the way.
"I think TV will maintain its current revenue base, but its percentage share is going to fall, and there is no way we can stop the trend…In three to five years this will happen more dramatically…/….What is holding back the internet’s development is lack of investment…./…We have pretty cool technologies coming along, so it’s not about limit of bandwidth. It’s the limit to the foreseeable revenues. We need to get the conservative telecom operators to bankroll billions more dollars of investment…/…The big agencies are still trying to figure out how to plan campaigns for the net, how to do the rate card — how to translate their old skills into the internet world."
Gary was fascinating, well spoken and seems like a truly inspirational, driven, creative individual. We look forward to seeing great things emerge not only from Asia but for the Tudou team.
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For an interesting interview with Youku CEO, check out our friend at DigitalWatch
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October 16th, 2008 at 7:24 pm
[...] one! If you want to see more Flypaper.tv coverage then go to latest news or check our articles on Tudou: Gary Wang , PricewaterhouseCooper’s panel discussion or non-traditional branding [...]
October 23rd, 2008 at 9:05 am
[...] week we covered Tudou after a fascinating panel from its CEO Gary Wang. Today we wanted to do a quick overview of Youku , [...]
October 27th, 2008 at 9:38 am
[...] Republic of China called the State Administration of Radio, Film, and Television (SARFT). In a previous article about Tudou we mentioned how Tudou must adhere to the censorship of the government. Online [...]
November 13th, 2008 at 2:52 am
Here is a more recent interview with Tudou cofounder Marc Van der Chijs
http://thechinaperspective.com/articles/entertainingthemassesthefutureofvideosharingandmobilegaminginchina4935/index.html
May 1st, 2009 at 1:42 am
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May 3rd, 2009 at 2:19 am
Guys - Is it true that Google’s rankings have been cracked? I read on CNET that http://VerifiedFile.com has pissed off Google & Yahoo with some crazy method to stealing on the top ranks.