This is the third post in our series: Discover China’s Next BAT, where we will go over the potential tech giants that are leading China’s IT industry. Previously, we looked at the next BAT and their founders. Stay tuned to keep updated on the next BAT.
iiMedia Research Group, a leading research institute in China, has released a list of leading mobile internet companies based on the findings of a corporate judging panel consisting of global industry experts, influential investors, and public voting with over a million ballots cast.
From that list, we have chosen eight companies we believe will dominate their markets. Here are the first four:
1. Xbed（搜床科技）- internet hotel
Xbed provides self-service hotels rooms. Here, self-service means a literally no service staff, no front desk, or security personnel. Using Xbed, users can rely completely on Xbed mobile app (or its WeChat account) for the whole stay from reserving the hotel room and checking in and out to opening and locking of the room door and payment.
Founded in May 2015, Xbed is said to bring a sharing economy model into the accommodation industry as it allows people who have worked in accommodation industry to be part-time workers to help with the cleaning.
2. Douyu TV (斗鱼) – live broadcasting
Founded in 2014, Douyu TV is one of the earliest live-streaming platforms among more than 200 Chinese streaming platforms that have popped up. The market is estimated to be worth US$ 5 billion (RMB 34.4 billion) in 2017.
Attracting investment from gaming giant Tencent, it has been dubbed the Chinese Twitch.tv with many top streamers playing MOBAs (multiplayer online battle arenas) similar to League of Legends. This has fueled the game’s continued popularity with the company now claiming over 100 million registered users, including 15 million daily active users (Twitch, for comparison, claims 100 million monthly users).
Last year, it secured more than RMB 2 billion yuan (about US$ 13.7 billion) in funding. The round reportedly pushes Douyu TV’s valuation above US$1 billion, making it yet another Chinese unicorn.
Although its strength is still in game broadcasting, it is also producing its own content.
3. Inke (映客) – live internet broadcast
According to the Cyberspace Administration, in November there were more than 300 live streaming companies in the mainland. The China Internet Network Information Center reported in June that there was a total of 325 million live streaming users in China, comprising 45.8 percent of the total internet user population. Inke is a live-streaming app where users earn money from their content.
Inke has a quite interesting way of monetizing. Viewers can send virtual gifts to hosts through in-app purchases. The host receives 30 percent of the gift’s value, which encourages them “to produce high-quality content”, while also keeping the platform profitable. Hosts can also “enhance the viewing experience” by adding interactive stickers.
By its entertainment promotional efforts, for instance, broadcasting live shows for a popular South Korean band called Big Bang, Inke’s downloads and revenue started to ramp up and even made it to the seventh spot on App Annie’s worldwide revenue rankings of iOS and Android apps in April 2016.
4. Yidao (易到用车) – vehicle sharing
In 2010, before there was a Didi or Uber entered China, Yidao was the first to start ride-hailing business. Six years later, it is not first in terms of market share, but Yidao still provides car services in 74 cities in China and 24 cities in the United States, has 1.35 million active users and a market value of US$ 15 billion.
After Didi announced its acquisition of Uber’s operations in China last year, there was even a joke that Yidao had finally jumped from third to second place in the market. Although the pioneer of the market, Yidao had always struggled with the rise of Didi and Uber China, which became popular on the back of heavy subsidies and cheap prices.
In fact, new regulations in the ride-hailing business after Chinese authorities finally legalized car-hailing apps in July 2016 might be a good news for Yidao. The new regulations by the government stipulated that unfair competition—giving heavy discounts and subsidies for services at below-cost price—should stop. In other words, Didi may not be so cheap as it always had been for many consumers, while affect on Yidao is probably minimal as Yidao targets on offering premium services at higher prices.