China

How a Chinese app could succeed where Quibi failed

Kuaishou won over Chinese viewers with cheaply produced, middlebrow dramas meant to be watched on phones. Now Tencent and ByteDance want in.

An ad for Kuaishou in the Beijing subway.

An ad for Kuaishou in the Beijing subway in January.

Photo: visual China Group/Getty Images

Right idea, wrong country?

Quibi got ridiculed for pushing short-form shows designed for mobile phones in the American market. But that same formula is working in China — with some crucial tweaks, like much lower production costs and ideas picked up from online works of fiction with a built-in fan base.

Kuaishou was the early winner in this battleground, but China's internet giants are racing to imitate its success. These short-form series, mainly made with amateur actors and low budgets, usually have no more than 10 episodes that run five minutes or less.

Jiaying Wang, 29, stumbled into the world of short-form drama when a 3-minute skit showed up in her Kuaishou feed. The seven-part miniseries, a soapy relationship saga filled with plot twists, got her hooked. Like most of her peers, Wang, a retail manager in Wuhan who's originally from the city of Xiangyang, seldom watches shows on TV. The quick, fast-paced shows are "more cathartic" and "fit better into my busy life," she said.

On Kuaishou, the short-video app popular with audiences outside of urban elite China, tens of millions of people like Wang are watching these short dramas. According to Kuaishou, more than 20,000 short series have been created on the service through 2020. Since the genre's emergence in late 2019, the number of people watching short dramas everyday on Kuaishou has exceeded 210 million, nearly half of the daily active users of the app, with an accumulated 35 million hours of viewing.

Short-form, professionally-generated content hasn't gotten a great start in the U.S., though Roku has said it's revived Quibi's library of originals, YouTube is spending $100 million on its vertical Shorts and Snap says its Originals have been watched by more than 85% of the U.S. Gen Z population.

A key difference is that Chinese short-form dramas aren't trying to be Hollywood Lite. Most don't feature celebrities. Corniness is a key part of their appeal. The short videos, heavy on genres like relationship or suspense, offer quick dopamine boosts by reenacting the most traditional TV tropes: evil mistresses, strict but forgiving fathers, attention-hungry concubines or sexy vampires.

Genres are merged and subverted in short-form dramas. In one popular short series, "Amazing Museum," a woman with a busy career starts to experience paranormal events, only to find that it's her dead father trying to care for her. The narrative, as with most short series, was adapted from works of online fiction.

"Audiences showed a high tolerance for imperfect storytelling and scenography in short-form dramas," said Ivan Dou, a showrunner at Chinese All Digital Publishing. Dou said short-form dramas were now a "core" way of adapting intellectual property from online work that might never have become full-length series.

The creators of the show, as well as their viewers, largely come from the xiachen (下沉) or "sinking" market, a term referring to the less-savvy internet users from lower-tier cities or rural China. Those are the same users who made Kuaishou what it is today. The short-video giant, which Tencent has invested in and whose shares trade on the Hong Kong Stock Exchange, is now the second-largest short-form video service in China after ByteDance's Douyin, and now embraces livestreaming, gaming and ecommerce.

The emergence of short-form dramas is now one more battlefield for Chinese internet giants, with Kuaishou holding the upper hand. "Short-form content and streaming are fundamentally different things, but might impact the time people spend on long-form TV, so at large this put Kuaishou in competition with more than just Douyin or Tencent's WeSee," said Rui Ma, an independent tech analyst who hosts the Tech Buzz China podcast.

Tencent, Baidu spinoff iQiyi, Alibaba's Youku and streamer Mango TV, which had transformed the way the Chinese audience consumed video before Kuaishou and Douyin came along, are now pushing forward with their own plans for short-form dramas.

"Content sits at the top of the marketing funnel because it brings traffic, which is directly monetizable as advertising, or in the case of livestreaming ecommerce, directly convertible into transactions — all important segments of Kuaishou's business," said Ma.

The raw materials for Chinese short-form dramas mostly don't come from professional screenwriters. Instead, amateur online fiction writers provide most of the fodder, which is then licensed and adapted for short series.

In September, Kuaishou formed a strategic partnership with Midu Novels, an online literature service backed by Nasdaq-listed Qutoutiao. Kuaishou also let some show makers charge viewers this year. "江城花火" ("Jiangcheng Fireworks"), the most popular paid show on the service, was purchased nearly a million times at a price of 3 yuan — about 45 cents — for the entire season.

Now Tencent and ByteDance are trying to lock up their own supply of fictional inspiration for shows by buying online literature and e-book sites. Tencent bought China Literature and ByteDance bought Zhangyue Ebook, China's first- and second-largest online literature services, respectively.

"Kuaishou is expected to expand its content ecosystem in a similar way in the future too, but Tencent has the overwhelming lead here, and these things take some time to build up," said Ma.

Tencent's WeSee, its TikTok-like short-video service also known as Weishi, now has 2-to-5-minute episodic videos. The company recently reorganized its video efforts to combine its long-form Tencent Video service with WeSee. Sun Zhonghuai, who oversees the combined video unit, recently lambasted China's short-video culture as "increasingly low-intellect and vulgar" and called the videos that run on some services "pig feed," according to Caixin Global.

The increasingly fierce competition — and the push for higher-quality material — is good news for creators and production companies. The services and the large internet companies backing them are offering competitive incentives for quality content. Dou's company, China All, currently makes around 50 short-form dramas a year. Last year, all were made for Kuaishou. This year, the firm is catering to multiple large customers. Show producers are typically paid upfront for production costs and then get royalties based on traffic.

For now, short dramas remain low-budget and low-effort compared to their long-form counterparts: Dou said show budgets are reaching $60,000 on the high end, compared to what Variety estimates is $5 million to $7 million an hour for an American streaming or cable drama. But the situation could shift as both professional creators and platforms seek to push the genre into the mainstream. Far from sinking like Quibi, these shows that started out 下沉 could soon rise to the high end, as video services experiment with more polished ideas behind the scenes.

Fintech

Judge Zia Faruqui is trying to teach you crypto, one ‘SNL’ reference at a time

His decisions on major cryptocurrency cases have quoted "The Big Lebowski," "SNL," and "Dr. Strangelove." That’s because he wants you — yes, you — to read them.

The ways Zia Faruqui (right) has weighed on cases that have come before him can give lawyers clues as to what legal frameworks will pass muster.

Photo: Carolyn Van Houten/The Washington Post via Getty Images

“Cryptocurrency and related software analytics tools are ‘The wave of the future, Dude. One hundred percent electronic.’”

That’s not a quote from "The Big Lebowski" — at least, not directly. It’s a quote from a Washington, D.C., district court memorandum opinion on the role cryptocurrency analytics tools can play in government investigations. The author is Magistrate Judge Zia Faruqui.

Keep Reading Show less
Veronica Irwin

Veronica Irwin (@vronirwin) is a San Francisco-based reporter at Protocol covering fintech. Previously she was at the San Francisco Examiner, covering tech from a hyper-local angle. Before that, her byline was featured in SF Weekly, The Nation, Techworker, Ms. Magazine and The Frisc.

The financial technology transformation is driving competition, creating consumer choice, and shaping the future of finance. Hear from seven fintech leaders who are reshaping the future of finance, and join the inaugural Financial Technology Association Fintech Summit to learn more.

Keep Reading Show less
FTA
The Financial Technology Association (FTA) represents industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.
Enterprise

AWS CEO: The cloud isn’t just about technology

As AWS preps for its annual re:Invent conference, Adam Selipsky talks product strategy, support for hybrid environments, and the value of the cloud in uncertain economic times.

Photo: Noah Berger/Getty Images for Amazon Web Services

AWS is gearing up for re:Invent, its annual cloud computing conference where announcements this year are expected to focus on its end-to-end data strategy and delivering new industry-specific services.

It will be the second re:Invent with CEO Adam Selipsky as leader of the industry’s largest cloud provider after his return last year to AWS from data visualization company Tableau Software.

Keep Reading Show less
Donna Goodison

Donna Goodison (@dgoodison) is Protocol's senior reporter focusing on enterprise infrastructure technology, from the 'Big 3' cloud computing providers to data centers. She previously covered the public cloud at CRN after 15 years as a business reporter for the Boston Herald. Based in Massachusetts, she also has worked as a Boston Globe freelancer, business reporter at the Boston Business Journal and real estate reporter at Banker & Tradesman after toiling at weekly newspapers.

Image: Protocol

We launched Protocol in February 2020 to cover the evolving power center of tech. It is with deep sadness that just under three years later, we are winding down the publication.

As of today, we will not publish any more stories. All of our newsletters, apart from our flagship, Source Code, will no longer be sent. Source Code will be published and sent for the next few weeks, but it will also close down in December.

Keep Reading Show less
Bennett Richardson

Bennett Richardson ( @bennettrich) is the president of Protocol. Prior to joining Protocol in 2019, Bennett was executive director of global strategic partnerships at POLITICO, where he led strategic growth efforts including POLITICO's European expansion in Brussels and POLITICO's creative agency POLITICO Focus during his six years with the company. Prior to POLITICO, Bennett was co-founder and CMO of Hinge, the mobile dating company recently acquired by Match Group. Bennett began his career in digital and social brand marketing working with major brands across tech, energy, and health care at leading marketing and communications agencies including Edelman and GMMB. Bennett is originally from Portland, Maine, and received his bachelor's degree from Colgate University.

Enterprise

Why large enterprises struggle to find suitable platforms for MLops

As companies expand their use of AI beyond running just a few machine learning models, and as larger enterprises go from deploying hundreds of models to thousands and even millions of models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

As companies expand their use of AI beyond running just a few machine learning models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

Photo: artpartner-images via Getty Images

On any given day, Lily AI runs hundreds of machine learning models using computer vision and natural language processing that are customized for its retail and ecommerce clients to make website product recommendations, forecast demand, and plan merchandising. But this spring when the company was in the market for a machine learning operations platform to manage its expanding model roster, it wasn’t easy to find a suitable off-the-shelf system that could handle such a large number of models in deployment while also meeting other criteria.

Some MLops platforms are not well-suited for maintaining even more than 10 machine learning models when it comes to keeping track of data, navigating their user interfaces, or reporting capabilities, Matthew Nokleby, machine learning manager for Lily AI’s product intelligence team, told Protocol earlier this year. “The duct tape starts to show,” he said.

Keep Reading Show less
Kate Kaye

Kate Kaye is an award-winning multimedia reporter digging deep and telling print, digital and audio stories. She covers AI and data for Protocol. Her reporting on AI and tech ethics issues has been published in OneZero, Fast Company, MIT Technology Review, CityLab, Ad Age and Digiday and heard on NPR. Kate is the creator of RedTailMedia.org and is the author of "Campaign '08: A Turning Point for Digital Media," a book about how the 2008 presidential campaigns used digital media and data.

Latest Stories
Bulletins