Tencent is reportedly spending hundreds of millions of RMB to strengthen and expand its online video node infrastructure network. The competitive online video market in China is intensifying with Youku focusing on its technology and content, and Tudou going public recently.

General Manager of Tencent Video, LIU Chen has remarked that original content is core. Therefore they will be investing a lot of money in to creating and buying original licensed content that will drive traffic. This will include popular dramas, reality contests, business, entertainment, sports, games, fashion, cars and so on programs.

To operationally support this expansion of content and streaming speed, Tencent is pumping the money into the server CDN networks infrastructure and deploying hundreds of nodes across the country to create Asia’s largest CDN network. The network is aimed at tapping into the growing importance of tier two to tier four cities and giving them a great viewing experience.

Since Tencent is heavily focusing on video now, recent rumors of Tencent’s potential investment in market leader, Youku, makes sense.

Jason is an Australian born Chinese living in Beijing, specializing in entrepreneurship, start-ups and the investment eco-system in China, especially in the tech and social area.

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