Digital disruption

A major setback for Sina Weibo and China’s online streaming industry


Papi Jiang: online host struck a lucrative deal with Jaeger-LeCoultre

Last week, a 26 year-old woman surnamed Zhang decided to broadcast herself on the internet chewing a giant piece of aloe vera (she claimed the plant would boost her collagen levels). Midway into the livestream, she started to feel a numbing sensation in her throat. Soon, she was complaining to her captivated audience that her throat was burning. Minutes later Zhang could no longer talk and she ended the livestream abruptly to call an ambulance.

As it turns out, our intrepid broadcaster was munching on agave (the stuff used to make tequila), not aloe vera, which looks similar but has a toxic sap that burns upon contact with skin. Zhang went straight to hospital and has made a full recovery. But bolstered by incidents like this, Chinese media regulators are trying to clamp down on the freewheeling antics of those like Zhang in the livestreaming business.

Last week, three major internet platforms were ordered to drop all of their video and audio streaming services. Microblogging site Sina Weibo, along with popular news portal site iFeng, owned by Phoenix TV, and video streaming platform AcFun, were all told that they did not possess the necessary licences to stream content and were “not in line with national audiovisual regulations and were propagating negative speech”.

The clampdown is another sign that the authorities are stepping up their controls over the internet, particularly of content deemed stupid or salacious. Last year the Ministry of Culture banned lewd performances online (eating bananas was outlawed) and regulators also banned streamers located outside China from posting video without prior permissions. Earlier this month, more than 60 social media accounts, including celebrity gossip sites, were shut down for disseminating “vulgar content” too.

Soon after the latest crackdown, the government issued yet another set of new rules for online content. Under the regulations, all content producers must submit their videos for prior approval on the platform on which they plan to broadcast (where it needs to be viewed by at least three “auditors”). The role of these supervisory panels is to make sure that content is not only “politically and morally correct” but that it also meets “aesthetic standards”.

In many cases the new rules seem more onerous than the regulations that television broadcasters face. Entertainment Capital, an industry blog, compared the two and found the latest diktats more stringent for vetting online shows. For instance, for television one of the rules simply states that a production company must uphold traditional Chinese cultural values. For those streamed on the internet, regulators have added that producers must include “the spread of kindness while maintaining integrity, justice, harmony and other core socialist values”.

In the list of content that must not appear in television series, items include “unhealthy views of marriage and relationships, including extra-marital affairs, one night stands and sexual freedom”. The list goes further for the internet, however, as it also adds wife-swapping and homosexuality.

No doubt the authorities are implementing the overhaul because of the ubiquity of social media, as well as the greater ease and immediacy of broadcasting online. And as ever, the motivations behind the campaign may be more about politics than cultural values. iFeng – one of the companies told to close down its streaming business – courted controversy last year by livestreaming parts of the US presidential election, and all of the internet portals have been instructed only to allow news that has been produced by state-authorised news organisations at city, provincial and national levels.

Also likely is that the authorities are concerned about individual broadcasters going rogue. “It [the Chinese government] is becoming increasingly willing to risk collateral damage: better to stop teenagers from watching singing holograms than let them see an unauthorised performance by a human being who proves careless with her words about the Party,” The Economist concluded.

Of course, there is a direct commercial impact in curtailing online content. “According to these new rules, virtually none of the recent hit series on the internet would have been able to air. All online video sites may as well go out of business,” says Entertainment Capital.

The crackdown comes at a time when video streaming is estimated to be worth Rmb20.8 billion ($3.05 billion) in China, according to iResearch, and news of the rule changes shaved more than $1 billion from Sina Weibo’s market capitalisation in New York. The microblogging platform recently led a $500 million funding round for video streaming site Yixia.

The next question: will the regulators widen their purge of livestreaming beyond Sina Weibo to individual channel hosts? More than 200 apps now offer web broadcast functions and between a third and a half of China’s internet population sometimes watches livestreams, Bloomberg suggests. Most of the livestreaming platforms make money from the sales of virtual items and gifts, online games and advertising, says TechNode. The most popular livestreamers can make up to $20,000 a month broadcasting themselves doing the most mundane things. Some have became national brands in their own right: Papi Jiang, a famous livestreamer with a huge following, made Rmb5 million from an ad campaign for Jaeger-LeCoultre.

One survey suggested that 80% of livestreaming hosts are female but that women make up only 20% of the total user base. That means the majority of the audiences are men looking at women online. For some of them, livestreaming is the closest thing to having a real girlfriend. Many of the livestreamers know that, and hostesses have resorted to provocative dancing and skimpy outfits to attract followers. Some of the platforms offer aspiring female streamers coaching tips – such as on how to best apply make-up – to get them as “camera-ready” as possible and a few have even arranged cosmetic surgery for performers, says Beijing News.

One female streamer told the Beijing newspaper that she works around the clock to keep her audiences entertained: “Yesterday, I was online from 3pm till 5am. The day before was even longer, I livestreamed till 6am or 7am. My fans said, ‘don’t leave’ and ‘stay with us until daybreak.’”

Livestreaming has not yet been banned completely (although it has disappeared from Sina Weibo and the two other social media sites whose channels were curtailed). Online providers such as YY are still broadcasting, although the speculation is for how much longer. “We will likely see more accounts shut down, especially those that publish content which is classified as morally subversive by the new cyber laws. Unfortunately, the cyber laws are incredibly vague,” Elijah Whaley, CMO at ParkLU, told TechNode.

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