PPTV (also known as PPLive) is one of China’s online video success stories, due in part to its focus on one particular kind of content: sports. Founded in 2004, the website offers a wide variety of video programming – most of it sports-related – over streaming video servers that operate according to a distributed peer-to-peer model that reduces costs by reducing bandwidth expenses.
In addition, PPTV viewers tend to watch for relatively longer periods of time: Football games are longer than cat videos. This makes it popular with advertisers. Zhang Kun, PPTV’s new vice president of corporate development, spoke with China Economic Review about the company’s business model and growing out of a dependence on content piracy.
Q: Can you talk a bit more specifically about hosting sports videos online as opposed to other kinds of content? It seems like there is an advantage there; people prefer to watch sports live.
A: Yeah, there’s no point of watching a DVD. Sports were what the company started with, and it seems like we have really gotten into people’s minds. When people think of watching sports, they come to PPTV. We do spend a lot of money in this particular area, especially for acquiring rights like those for the World Cup and Wimbledon.
Q: What about import barriers? There are restrictions on foreign movies and such in China. Are there any restrictions on sports content?
A: None that I am aware of. It just depends on user demand for a given sport. NBA basketball is very popular. Hockey? Many Chinese people don’t know what this sport is.
Q: Do you have a license to show NBA basketball games? What other kinds of sporting events are you licensing here?
A: We have a contract to show NFL American football games; starting this season, we are showing three games per week. For the NBA, I am not sure.
Q: Some have accused your website of hosting a large amount of pirated content.
A: The whole industry in China has seen these kind of issues in differing degrees. I would say that before 2009, the majority of the content came from [pirated] sources. But since 2009 it has been getting better. Look at the cost of content. before 2009, online media rights for a TV series were probably sold for RMB2,000 [US$310] per episode or less. Now it is easily RMB100,000, or sometimes even RMB200,000 per episode – and we are talking about non-exclusive rights. Piracy is now considered a crime, not just an “issue.”
Q: So how does this play out with PPTV and sports?
A: You know sports has an advantage in that area. As I mentioned earlier, no one buys a sports DVD. Most people watch it live. That’s the nature of that sort of programming. You can buy a movie DVD on the street and upload it. But for sports licensing and content, you have to get it through an accredited source. You can’t just get the signal from anywhere and then show it.
Q: You can’t? When people are complaining about pirated content on your website, aren’t they complaining about live sports?
A: I think they are complaining more about video-on-demand content like dramas and movies uploaded to our site. If you are a content owner, if you find a problem, let us know. That’s the proper way to address the issue.