Back in 2003 when most players were flocking to the PC-based online video market, Liu Shuyao chose the smaller screen, mobile phone. Liu is the founder of 100tv, a mobile video service who claims it enjoys RMB billions of revenue from content distribution and was profitable early on. 100tv has been consistent with what it’s been doing, from the good old times when service providers profited from the 2G world to the current mobile Internet era, and luckily enough it keeps on making money. The founder told the story about how they changed the business model to adapt to the smartphone surge in an interview recently.

img:100tv.com

A Firm Focus

When Liu started up this company with his partner Ding Yi, there were very few peers out in the field for the main trend at that time was still on some value-added SMS services. It could be a good thing or a tough thing for a startup. As a pathfinder of mobile videos, 100tv underwent a period of exploring without any experiences or examples. With an early angel investment of $500,000, it had some hard time at the first two years.

Very soon, Liu realized that the bandwidth over PC ends was too consuming to afford, “We decided that the core competence of 100tv should be on the mobile, so we resolutely quit services on PC. Then we set another goal to be a small but exquisite company, which is the philosophy we still believe in.”

In the WAP era, 100tv’s role was behind the scenes. It took the charging model on mobile video products, and became a cell phone video service provider. With its advantages over technical video editing and channel marketing, 100tv helps entertainment companies or publishers integrate their resources to fit in different broadcasting platforms operated by the mobile operators. Apart from channel marketing, 100tv can also share the revenues from paid users of mobile operators. By 2009, the company had already begun earning.

To Diversify Business Model in Smartphone Era

Just one year later, with the ever-growing penetration of smartphones, an open and free-of-charge mobile Internet era came. 100tv quickly shifted in place that launched its HD video players on Android, iOS and Pads in the same year and a player, offering massive content, in 2011.

The company claims its mobile apps have seen 45 million downloads. It seems that the company was very adaptive to market changes, and it still is. “What we used to be doing is to sell video services. However, the freemium model in the mobile Internet market has become mainstream, and we are meant to choose a diversified model. 100tv could make itself a media platform, and in the future it has to introduce ads,” said Liu.

Currently the company is offering users functions like navigation or filtering by partnering with some video sites as Youku, Tudou or Qiyi. Liu also noted that 100tv will try a push approach of video recommendations based on user’s subscription data. “Our ultimate goal is to become a mobile video gateway, which is also the premise for us to entering a bigger ads market.”

The company first won $5m and $10m in the first two rounds of funding, and in 2011 it got a $15m Series C funding. As revealed, the company is now looking for a funding of $30m-40m in the fourth round, aiming at marketing and promotion.