Yahoo Finance ByteDance to close three 'mini drama' video channels amid competition, regulatory scrutiny
ByteDance, the owner of short video apps TikTok and Douyin, has decided to close three domestic channels that provide popular "mini dramas" amid growing competition and regulatory pressure, in the latest example of restructuring by China's most valuable unicorn.
Two channels, Paopaoxinxuan and Guodongxinxuan, which have been accessible on the Douyin platform for about a year, will cease operations after Monday due to "business adjustments", according to official posts seen when opening the channels. A third channel, Zhuazhuaxinxuan, was offline by Friday.
All three specialised in so-called online short series, with each episode typically a few minutes long. Some of the offerings were interactive, similar to Netflix's Black Mirror: Bandersnatch and Love Is All Around on Steam and Epic Games, where the audience can choose the storyline for the protagonist in the show. The channels charged 199 yuan (US$27) for monthly subscription to access certain content. Refunds for users who had already paid in advance were promised, according to the posts.
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Short series were once regarded as a new form of online entertainment to generate traffic and boost advertising revenues, but they quickly invited regulatory scrutiny over their content. Starting this month, all mini dramas in China must go through a production licensing and content review before they can be broadcast on platforms.
A woman speaks on her phone near the logo for Douyin in Beijing, March 31, 2021. Photo: AP alt=A woman speaks on her phone near the logo for Douyin in Beijing, March 31, 2021. Photo: AP>
As a result of the scrutiny, Douyin issued a statement in April saying it had taken down six mini dramas.
ByteDance declined to comment on the latest channel closures.
Chinese media 36Kr, which first reported the news on Thursday, cited a source who said that ByteDance may reconsider its presence in interactive short dramas given the market opportunities.
Dubbed "the app factory" in China, ByteDance is often quick to shut down new online products if they do not perform to expectations. The online short drama market in China saw revenues soar 268 per cent to 37.4 billion yuan (US$5.1 billion) in 2023, and that figure is expected to surpass 100 billion yuan by 2027, according to consultancy iiMedia Research.
After the closure of the three short series channels on Douyin, ByteDance will still operate a stand-alone app named Pipixia Lite, launched last year to provide hundreds of series in a range of genres, including romance, action and ancient royalty stories.
However, the sector is seeing growing competition. Kuaishou Technology, the biggest rival to ByteDance in short video, launched a stand-alone short drama app called Xifan. Platforms such as Tencent Video, under social media and video gaming giant Tencent Holdings, and Baidu-backed iQiyi, have set aside dedicated channels for mini-dramas alongside their other content.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
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