Chinese internet users are changing the landscape for paid content leaving piracy

[Len]

Chinese internet users are changing the landscape for paid content with top-grossing video to chat apps

China’s biggest tech players are gaining confidence that the public will pay for content as they ramp up efforts to license overseas content in recent years

China has been known as a piracy black hole for years, from knock-off Louis Vuitton bags to illegal music downloads. That picture is fast receding, especially online, where the world’s biggest internet population is spending money, lots of it, to support their favourite stars.

Five of the top 10 applications on Apple’s iOS app store by consumer spending this year are owned by Chinese companies. They include Tencent Video, which came in second behind Netflix. iQiyi, Kwai, Youku and QQ round out the other top-grossing Chinese apps, according to report by data firm App Annie published on July 2.

China’s biggest tech players are gaining confidence that the public will pay for content as they ramp up efforts to license overseas content in recent years. Tencent, for example, became HBO’s exclusive online distributor in China in 2014, with hit shows such as Game of Thrones available only to its more than 60 million paid subscribers.

Often dubbed China’s answer to Netflix, iQiyi is also going toward original content, creating viral reality shows such as The Rap of China, whose 12 episodes have collectively been viewed three billion times.

More recently, Tencent Video and iQiyi attracted renewed attention from their users, thanks to popular idol talent shows inspired by offerings in South Korea. The shows – called Produce 101 and Idol Producer – let viewers select members of a boy or girl band, and those who are paid subscribers have a bigger say in determining their dream pop groups.

In 2016, China overtook the US to become the biggest market by App Store consumer spend, and has since stayed in the top ranks in terms of both downloads and consumer spend, according to the App Annie report.

Such a trend is in large part powered by a boom in Chinese live-streaming apps, whose business models depend on taking a cut of the virtual gifts that viewers tip hosts. The gifts range from virtual cucumbers to digital yachts that can easily cost hundreds of dollars in real money.

According to App Annie, live-streaming app Kwai is the world’s 5th-ranking iOS app by consumer spend so far this year, and rival app Tik Tok is the most downloaded iOS app worldwide.