Behind The Rumors Of Baidu'S Acquisition Of YY: Can Business Development Be "1 + 1 Greater Than 2"?

After the merger of Huya and douyu, another heavy integration of live broadcasting industry may emerge this year.

On October 26, according to media reports, a number of people familiar with the matter disclosed that there was new news on Baidu's acquisition of YY business, a live broadcasting platform of huanju times. This negotiation is nearly completed, or relevant details will be officially announced in the near future. Baidu's acquisition plan is limited to YY's domestic business, while its overseas business will remain independent, the report said.

Influenced by this rumor, the stock price of huanju Times rose by more than 10% before the U.S. stock market on October 23. By the end of the day, the share price of huanju times was $85.13, up 5.22%, and its market value reached $6.879 billion.

The 21st century economic report confirmed this to Baidu, but Baidu did not give a clear reply. YY declined to comment.

"This rumor still has a certain credibility, because this acquisition is indeed the result that Baidu and happy gathering era want." Pan Helin, executive director of the Digital Economy Research Institute of Central South University of Finance and law, analyzes that "YY domestic business can expand business boundaries for Baidu, or enrich Baidu's search content orientation."

A new round of live broadcasting war

For the gathering era, the present time point is really delicate. At least from the data point of view, compared with the rapid development of overseas, the domestic business in the era of reunion has entered a growth bottleneck.

According to the latest financial report data of happy gathering times, in the second quarter of this year, the monthly active users of mobile terminal of its global live broadcasting service increased by 20.4% to 102.3 million, of which YY live broadcast was 41.2 million, with a year-on-year growth of 6.0%; bigo live outside China was 29.4 million, with a year-on-year increase of 41.3%; and hago31.7 million outside China, with a year-on-year growth of 25.3%.

It should be noted that, according to Caibao, the live broadcasting revenue of bigo exceeded more than half of the group's live broadcasting revenue for the first time. In contrast, YY's live broadcasting revenue in the second quarter increased by 40.1% year-on-year, but its total number of paid users decreased by 2.2% year-on-year. Compared with the overseas expansion momentum and influence of bigo, YY, which focuses on the domestic market, is slowing down.

In fact, the overall growth of domestic traditional live broadcasting platform is facing industry bottleneck period, at the same time, it also needs to cope with the competition of new sharp short video platforms such as Shuo Yin and Kuai Shou. According to the analysis, in the first half of this year, the income of typical traditional entertainment live broadcasting enterprises declined to a certain extent: the revenue of happy gathering era was 10.578 billion yuan, a year-on-year decrease of 4.5%; the revenue of Momo was 7.462 billion yuan, a year-on-year decrease of 5.25%; the revenue of Tiange interactive was 211 million yuan, a year-on-year decrease of 24.58%.

Therefore, although the epidemic situation in the first quarter of this year made live delivery extremely popular, competition and integration have also become a new trend in the industry. This year, for example, with Tencent's push, Betta and tiger teeth finally completed the merger this month.

Interestingly, behind this deal, there is still a gathering era. In August this year, huanju Times announced the transfer of 30 million shares of Huya class B common shares to Tencent, with a transaction scale of $810 million in cash. In September, the main company of Huya live broadcast changed, and the affiliated company of huanju times withdrew, and Tencent wholly owned the shares, which paved the way for the merger of the two.

It is worth noting that on the same day of the rumor of YY business sale, Li Xueling, co-founder, chairman and CEO of the happy gathering era, said in his circle of friends that "before, he focused on fighting and always wanted to win. In the future, we should focus on providing value to others and make tasks that seem impossible to accomplish. " This is also speculated by the outside world, perhaps related to the acquisition rumors.

"This is true for most of the Internet industry. After all the giants have risen together, one or two enterprises have been left behind. Internet companies have finally moved towards integration, because most of the Internet industries are in the mode of burning money," Pan Helin analysis points out. "It is not a big problem for the live broadcast market to accommodate 2-3 direct broadcasting stations in the future, so concentration is inevitable."

In addition, YY, Baidu will continue to play a major domestic game, but Baidu will continue to play a major role in the domestic market.

Pan and Lin pointed out that the live broadcast platform is backed by the Internet giant, and maintaining the stability of the long-term cash flow is beneficial to both the Internet giant and the live broadcast platform. What's more, this combination is easy to produce synergy with the existing business of Internet giants.

"For example, Tencent, which takes games as its core, needs live games, Alibaba needs live broadcasting by e-commerce, and Baidu also needs to direct its search results to more of its own content platforms." Pan Helin believes that "today's live broadcast platform is a traffic portal, and relying solely on live broadcast content to attract traffic, the threshold is too low, and the sustainability is too poor. Only with the business integration of the existing giants, can there be greater value, and the live broadcast platform can be gradually realized. "

Baidu expands business boundaries

The live broadcast is undoubtedly one of Baidu's key driving circuits this year, which is no wonder that Baidu or intends to make a large-scale acquisition.

Earlier this year, baidu executive vice president Shen Shuo said in an interview with media including the 21st century economic report that what Baidu is doing now is shifting from traditional information search to service connection.

"Live broadcasting will be one of the media." Shen Shuo pointed out. In his opinion, search and live broadcast have a very good combination. "Live broadcast can exist independently, but the existence of live broadcast also needs to be found. At the same time, compared with text and short video, live broadcast is also more instant and interactive.".

However, at that time, Baidu's internal positioning of live broadcasting was still the nature of knowledge live broadcasting. Li Yanhong stressed that it is necessary to express information and knowledge through live broadcast on Baidu platform.

The logic of Baidu's live broadcast of knowledge is not difficult to understand. Search is a strong demand, high-quality, professional information and knowledge is the most important content of search, which is also the reason why baidu used to make encyclopedia, post bar, know-how and other pan knowledge products. Now these knowledge products have become the standard configuration of search.

And the current form of content information is more abundant, more short video, live broadcast and other formats, baidu is bound to be layout. Baidu's live broadcast is located in the pan knowledge live broadcast which is strongly related to the search business. In this way, it can develop in coordination with the main business. It can not only play the advantages of search, but also promote the search business.

However, YY, who started entertainment business, is quite different from this one. In YY applications, it has dance, outdoor, talk show, games, shoumai, live shopping and other channels, which is more entertaining.

If the acquisition, Baidu's first problem is business integration. In fact, only through business integration can the maximum value of the live broadcast platform be brought into play. Some people familiar with the matter said that around the acquisition, baidu really moved the mind, but still has not made up its mind. In other words, there are still concerns about Baidu's future business integration.

"For Baidu, YY in the future should still expand business boundaries in the direction of short video and live broadcast. This itself and Baidu knowledge live positioning does not conflict. " Pan and Lin analysis said, "because the results of the search engine are multi-purpose, some people search for happiness, others search for knowledge, so YY domestic business can expand business boundaries for Baidu, or enrich Baidu's search content orientation."

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