iQiyi bets on tech and content

iQiyi, one of China’s leading online video websites, is to invest heavily in technology and content, including a 20 billion yuan (US$2.86 billion) investment in content this year, the company’s top executives said in Shanghai on Wednesday.

Artificial intelligence and 5G technologies will be key competitive advantages in the industry, covering content production, video recommendation, advertising sorting and program distribution, said Gong Yu, founder and chief executive of Nasdaq-listed iQiyi. 

The company's 20 billion yuan investment in content in 2019 will cover self-produced dramas and entertainment shows. The figure will “be bigger” in 2020, it said.

In China, the online video market is dominated by iQiyi, Tencent Video and Alibaba-owned Youku Tudou, a situation that won’t change in a short term, industry insiders said.

“Technology innovation and content quality will become key sectors in competition,” said Gong.

Compared with rivals and overseas counterparts such as Netflix, iQiyi relies on both paid membership and advertising income, he added.

iQiyi had more than 100 million paid users by the end of second quarter. It still has the potential to attract new paid users among older people and residents in China's small towns, said Yang Xianghua, iQiyi’s senior vice president.

The company is also expanding in overseas markets, especially in Asia. Chinese programs are becoming more and more popular in Asian markets, said Yang.