China’s top search engine raises $1.5b to battle Alibaba over streaming

Photo credit: Tech in Asia.

Streaming video is one of the most brutally expensive sectors in China’s tech industry, with a number of web giants paying out big money to secure the rights to movies and TV shows that can pull in users that expects things for free.

In this tumultuous industry, Baidu spin-off iQiyi today revealed it has raised US$1.5 billion from a convertible notes offering to secure more cash to battle Jack Ma’s ecommerce titan, Alibaba, which runs Youku, China’s most well-known streaming site.

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Baidu has invested a fresh US$300 million in iQiyi as part of this fundraising, the search engine titan said today.

Both have “VIP” packages – optional monthly or annual subscriptions.

iQiyi had 481 million monthly active users at the end of 2016. There’s no recent data for Youku, which Alibaba acquired in a US$4.2 billion deal in October 2015.

Both Baidu’s iQiyi and Alibaba’s Youku have optional monthly or annual subscriptions, which start at about US$30 per year.

Netflix, which is avoiding the frantic China market, has 93 million paying members across around 190 countries.

iQiyi estimates that the total revenue from China’s top three online video platforms – itself, Youku, and Tencent Video – will surpass China’s TV industry by the end of 2017. But that doesn’t account for the significant costs of acquiring the much more current content that streaming services offer.

See: 5 reasons why Netflix just said NOPE to China

This post China’s top search engine raises $1.5b to battle Alibaba over streaming appeared first on Tech in Asia.

from Tech in Asia https://www.techinasia.com/china-video-streaming-way-baidu-iqiyi-funding
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