Difficult, really too difficult, old debt even new debt, capital has not been recovered, what else can we do? When talking about the business situation, a Hengdian film and television equipment rental shop owner told the 21st century economic reporter.
In Hengdian in early April, spring was just right, but the flow of people was depressed. When reporters came to Hengdian Film and Television Industry Experimental Zone next to the Hengdian Government, many doors were closed, and Tencents public space was more magnificent because of the scarcity of crowds; several middle-aged local women occupied the study rooms of the University; many leading studios were left with only desks.
At the end of April, the 21st Century Economic Reporter visited again. Many equipment store owners told reporters that the situation had not fundamentally improved. So far this year, only one drama group has been received, and in the first half of last year, 4-6 groups have been received. Some bosses said.
The whole country is also hot and cool, and the situation in Beijing is not optimistic. During the Qingming Festival, reporters visited the Sunshine Hotel in Wanglu, Xida, which is known as the audition base of Beijing Opera Group, and found that winter was getting worse. When the 21st Century Economic Reporter visited, there were only four theatre groups in Sunshine Hotel, which had 80 rooms. We havent had so many plays in winter this year, said Liu Ming, director of the movie My Youth Is No longer Seen which is being prepared in the hotel. During the second visit of journalists at the end of April, there was a slight increase in the number of theatre groups stationed, but the turning-on rate was still low.
Another idol artist told reporters that nearly a third of Beijings theatre crews were suspended. There is a veteran deputy director, who is now turning to the circle of friends as micro-business. Reporters learned from many professionals that the situation is getting worse. The shutdown rate of the project is much higher than 30%.
The performance of listed companies is not optimistic. Huaze Film and Television (300133.SZ), the best performer, had revenue of 5.797 billion yuan last year, an increase of 10.52%, net profit of 211 million yuan, a decrease of 66.71%, non-net profit of 121 million yuan, a decrease of 78.22% over the same period. Ciwen Media (002343.SZ), Huawei Culture (002502.SZ) and Tangde Film and Television (300426.SZ) all suffered losses last year.
The overall downward incentive of the industry, to a large extent, comes from the historical turning point of the game between video platforms and film and television companies. Executives of listed film and television companies have disclosed to economic reporters in the 21st century that a large number of projects have now been shelved by video platforms, and prices have become the first step in bargaining. Youku was affected by the Yang Weidong incident, many projects have been stopped, Achieving Arts, Tencent also took the opportunity to slow down the pace of purchasing drama. Many projects were almost ready, but they just couldnt start. He said.
Some middle-level film listed companies confessed to reporters that most of the companys online drama projects have been shut down because the video platform is no longer needed.
As the video platform changes from snatching project to killing project, it means that the initiative of the platform and content companies is fundamentally adjusted, which will trigger a new round of reshuffle of the film and television companies, and this time, it will be truly subversive.
Depression upstream and downstream
When she saw Zhao Lan, the owner of Hengdian Film and Television Equipment Rental Shop (not her real name), she was sitting at her desk looking at information and sighing, while the workers were idle in another room.
Zhao Lan is now facing a situation of sharp decline in profits. There are only a dozen of the original 40 or 50 theatre groups this year. They are all small theatre groups. Some of them even bring equipment directly from Beijing, which makes it difficult to do business. She said. According to the dynamic announcement of Hengdian Film and Television Citys official network, 27 theatre groups are in the process of filming from April 30 to May 7.
At the same time, Zhao Lan is also caught in the reverse cycle of equipment being forced to upgrade at a high price under the condition of loss. Business is difficult, but equipment must be upgraded, otherwise no one rents, a random machine is hundreds of thousands, change a light bulb 2000 yuan, the last round of machine upgrade loans have not been paid off, this round of upgrade has come again. Zhao Lan to the 21st century economic reporter helplessly said that, in addition, there is a surge of high rents. After investing so much money, we cant get out at all. We have to wait. She said.
Zhao Lans anxiety is universal. In an interview at the end of April, another owner of a video equipment rental shop said that he had lost money since September 2018. Gross profit will reach 1 million in 2016, he lamented. At the same time, several bosses said that the rental price of equipment has not declined, because no one rents at all, the reduction is also in vain.
Actors are also in poor condition. During a visit to Beijing Sunshine Hotel, the reporter met Yang Liu (alias), a member of the Beijing Film Academy, Ma Xinhao, who became an actor after graduating from Broadcasting and Hosting Department of Guangzhou Sports College, and Erzhen, a comedian, who were all struggling to find jobs. The whole film and television industry has been in a bad environment for the past two years. All three of them have not received a play for quite a long time. Psychological pressure is particularly high, the whole heart is a collapse of the state. Two really.
Head content companies are also under pressure. In a recent interview, Yu, a well-known producer and founder of entertainment film and television, is telling economic reporters in the 21st century that one of the costume drama projects he is shooting has been offered a very low price and almost equal cost. I dont take part-time producer fees. In the right way.
Yu Zhengs dramatic costume project has its particularity. The costume drama is not encouraged, the policy knife has not yet landed, and the platform does not need to take risks for a certain costume drama. (Based on policy risk) Now the costume drama will definitely rush to the broadcasting stage, the platform is actually no lack of drama. The above analysis of top executives of film and television listed companies.
As the industrys top film and television listed companies, last years performance is even more difficult to say optimistic. Ciwen Media lost 1.094 billion yuan last year, down 36.73% from the same period last year. Gross profit rate of film and television business dropped by only 1.7% and 40.35% from the same period last year. Huawei Culture lost 1.277 billion yuan, down 44.958% from the same period last year. Goodwill impairment was the main reason. Tang De Television lost 927 million yuan, its revenue was only 272 million yuan. The main reason for the loss was that Baqing Chuan could not be broadcast normally.
Huanrui Century (000892.SZ) has a net profit of 325 million yuan (23.09% less than the previous year), but its annual report is reserved. The TV play Changan of the World, which has not yet been broadcasted normally, has an account receivable balance of 506 million yuan, and Huanruis management has made a provision of 225 million yuan for bad debts according to the age analysis method. Tianjian Accounting Firm believes that it is impossible to obtain sufficient and appropriate audit evidence to judge the impact of Changan on the recoverability of accounts receivable. Therefore, it is impossible to determine whether it is necessary to adjust the bad debts preparation of accounts receivable related to Changan.
Big IP failure
At present, the whole industry slump of film and television companies from top to bottom is behind the strategic shift of the video platform. Of course, a previous wave of bubbles has a great relationship with the platforms contention.
At present, many small and medium-sized company projects have been unable to be released from the video platform, according to the executives of the listed film and television companies mentioned above. They want to tie-in through a large company like ours, but many projects have their own problems, and the platform has passed the stage of quantification. He said.
On the other side, platforms continue to overturn existing cooperation. With the former Youku President Yang Weidong being investigated by the police for corruption, a large number of original Youku drama projects have stagnated cooperation, Tencent and IQI, which have reduced competition pressure, immediately followed Youkus slowdown strategy, and the three truce trend is obvious.
There are too many interests in the Yang Weidong case, and Ali will certainly reshape it. This is a normal situation. Originally, when the three countries were tripartite, we were very stable. One website had been depreciated, and the other two would surely reduce the price. However, video websites now have a relatively monopolistic and hegemonic channel status, which is a good business for them. Industry executives who have contacts with various video websites have told reporters of 21st century economic reports.
Video giants do not deny the existence of this situation. At the Snowball Summit in late March, Wang Xiaohui, the chief content officer of IQYI, said that the copyright of new media dropped from 178 million to 8 million, mostly in 34 million. We will no longer engage in an arms race. This industry is an oligopoly industry by nature. It is impossible to monopolize it exclusively. It is impossible to compete rationally and reasonably. If all the reasonable external conditions are available, it will be profitable. This trend also emerged last year. He said.
There are many factors behind Wang Xiaohuis trend. Importantly, the industrys previously superstitious Big IP model has collapsed. Typical examples are Tianshengchang Song and Wu Wu Qian Kun which are far below the expected broadcast results.
Later, it was found that this logic (big IP mode) was not established, and when the tide quickly receded, the industry really encountered a great crisis. Wang Xiaohui is called.
Another reason is that the slowdown in economic growth and online traffic are overlapping, Internet giants are looking for new eco-business, and the engine of money-burning video platforms is slowing down. The sustainability of AIQIYIs cash flow has always been a concern in the industry. One of its countermeasures is to issue convertible bonds for the second time in less than half a year. Tencents vital game revenue is also slowing down. Alis market is more revered by cloud business.
They (giants) are easy to bear the pressure of performance, easy to be short-sighted, and the reporting chain is too long and inflexible. Its hard to really do a good job. A well-known film company founder told the 21st century economic reporter. For his statement, including directors, investors and other industry core personages expressed their agreement.
Hot money outflow
Oligopolys shake hands and make peace. For film and television companies, it is like cutting off the most important source of capital and performance exports, and financing is becoming more and more difficult. Financing costs are very high and bank loans are not granted. Its better for big companies and worse for small ones. The above-mentioned film and television listed company executives disclosed.
Industry financing confirms this statement. According to Wind data, between May 2015 and May 2019, investment in the film and entertainment industry showed a cliff-like downward trend, with two significant lows in 2016 and this year. In 2015, the investment amount of the industry was 13.091 billion yuan, which fell to 6.452 billion yuan the following year, with half of the total. Then it entered the upward express lane and reached 53.777 billion yuan in 2018. This year, the investment amount will be more than half, with only 262 million yuan.
We dont invest in any pure content companies at high valuations right now. Its too risky. Earlier, Huo Zhongyan, founding partner of Hewhale Capital, told reporters on 21st century economic reports. Many investors interviewed agreed with Mr. Huos statement.
The highlight of industry financing is the frequent high-value financing of several major film and television companies, including Tencents direct investment in Lingmeng, reading 15.5 billion yuan to acquire Xinli and so on. The collapse began with several dramasFight the Streetand the changing environment. This is a slow and rapid process. The industry said above.
The difficulty of financing is related to the tightening of industry regulation. From 2006 to 2015, due to the weak foundation of the domestic cultural media industry, the policy side gave support to the media industry in terms of financing and tax benefits, and vigorously promoted the development of the industry.
Since 2018, the media industry policy supervision has been upgraded. On the basis of strictly controlling the content supervision caliber, regulators have vigorously rectified the normative operation of upstream factors and downstream channels. Regulatory regulatory measures such as actorssalary, Yin-Yang contract and tax issues have fallen to the ground, and major participants in the industry have also issued relevant self-regulatory documents.
At present, the film and television industry is still in the adjustment period. The storm of tax reimbursement has passed, and now the impact is more on the business level. Many big Cafe actors are reluctant to take part in the play at a lower price and still wait and see, resulting in a lot of projects can not start, especially the head project. The senior management of the listed film and television companies mentioned above.
Gong Yu, the CEO of IQI, also told an analyst conference in February that the price of actors had dropped sharply. At present, the salary of a top actor is 50 million yuan, which used to be as high as 150 million yuan. He said.
Behind the frozen industry, there is a deep turning point - oligopoly video platform is increasingly dominant. The industry had expected it, but it didnt expect it to come so early.
The depth of the industry, the platform has been almost touched, the channel of relative monopoly has been determined, and began to establish more suitable industry rules. The above-mentioned industry high-level road.
Sooner or later this day will come. Industry consensus is that in the content industry smile curve, IP (creative planning) and channel (publicity) are divided into the highest two ends of the value chain. The content represented by film and television companies is production, which is at the bottom of the value chain, and as time goes on, both ends become stronger. In IP, the giants behind video websites have a strong capital chain, which has advantages in original IP?, purchasing IP?, cooperative IP?, and cash flow. In the end, the extreme situation is that the whole industry is working for the platform.
In the process of the establishment of giant ecology, film and television companies are also facing a cruel shuffle. The most tragic thing now is that thewaistproject and the company behind it have the largest backlog, forming abarrier lake. The market is still short of head content, and the head can only be done by large companies, and the Matthew effect will intensify. According to the executives of the listed film and television companies mentioned above.
In addition, he also revealed that the various platforms on the content of the head is still extravagant. Youkus opening and closing meetings also clearly indicate that more than 400 million projects will be done. He said.
There are also different views. Wang Beibei, CEO of Data Platform, believes that a strong platform is an opportunity for small companies, while the premium for large companies will be relatively lower. The strongest thing for big companies is the ability to organize disks, but the fall of big IP and big stars makes their highly dependent advantages become chicken ribs. Many so-called dramas are actually waist dramas and there are not so many head dramas. In this way, the performance of large companies is likely to depend on a very small number of dramas, which depends on luck. But small and beautiful companies, on the contrary, are prone to emerge after the platform has levelled everything. She told 21st Century Economic Reporters.
There are also companies that choose the third path. Yang Le, CEO of entertainment film and television, once told reporters that opening up the global market horizontally is one of the ways out for entertainment. The Entertainment Management Team is composed of international talents from Malaysia and Hong Kong. She introduced.
At the same time, the increasingly dominant platform, in its own transformation process, will also re-shape the film and television companies. The shift from to? B (advertising revenue) to to? C (membership payment) is the trend. Last years earnings showed that the net loss increased to 3.5 billion yuan, but the business data were optimistic. Among them, the revenue of membership services was 10.6 billion yuan last year, an increase of 72% over the previous year, which exceeded the advertising revenue. Gong Yu has also made several public statements, relying on membersincome, which is more sustainable than advertising.
In the mode of purchasing plays, IQI is also exploring to C. Late last year, Geng Zhanghao, Senior Vice President of IQI, told 21st Century Economic Reporters that the proportion of online drama producers and platforms has increased from 5:5 to 7:3. Geng Hao said that in 2018, there were 119 episodes of Aqiyis online sub-account drama, with a grade A growth of more than 50%. For the pay-for-account network drama, our basic goal is to produce some fine content in small and medium-sized production, through the distribution channels of pay-for-account to obtain high returns. He said.
Geng Hao also admitted that, in terms of quantity, Akiyis Ledger has been more than half, but in terms of content cost, copyright plays still account for the majority. The share of risks and benefits is shared by the distributors, while the producers of copyright dramas are guaranteed by drought and flood. It is not that the distributors are moving towards the distributors, but that more and more companies are devoting part of their energy and resources to the distributors. In the future, it must be a trend to divide accounts, because dividing accounts can really test good works. He said. Reporters also learned that in Ichi Art, solo distributors will receive higher treatment.
Wang Beibei said that in the wave of distribution, the operating risk of film and television companies will be greatly increased, which will reduce the waste of drama shooting, and will pay more attention to the content itself.
Standing at the present node, this cold winter also has the effect of curettage on the film and television industry itself. Executives of the above-mentioned film and television companies believe that the industry is really paying more and more attention to content. Cafe invisibility, new people began to emerge, with the new actor platform on the importance of scripts, for the content itself is still good. Companies that really have good works will stand out in the market. He said.
Gong Yingtan, a well-known writer, also told economic reporters in the 21st century that there are more and more good writers around.
The industry has reached the bottom and will slowly slow down, depending on two driving forces, one is the continued investment of Tencent and Ali, the other is the slow recovery of advertising. Wang Beibei said.
Source: Responsible Editor of 21st Century Economic Report: Yu Youjun _NBJS8144