ByteDance’s long streaming video to challenging iQiyi and Tencent

Tinuku - Beijing ByteDance Technology, operator of popular news aggregator Jinri Toutiao and short video app Tik Tok, plans to bring long-form content in China’s streaming video market and compete head-to-head with industry leaders iQiyi, Tencent Video and Youku Tudou.

The fast-growing start-up is developing new film and television drama segments for its Xigua Video app, which will be launched either at the end of this year or early next year, according to people familiar with the initiative.

Tinuku ByteDance’s long streaming video to challenging iQiyi and Tencent

It plans to buy the exclusive digital rights for selected films and TV shows, as well as finance the development of a number of original film and TV projects and was looking at a paid subscription business model, said the source.

Founded in 2012 by Zhang Yiming, ByteDance currently runs several short video apps, the most popular of which are Douyin and Xigua. Known as Tik Tok outside China, Douyin provides clips shorter than 15 seconds and has become the go-to short video platform for China’s Generation Z. Every video on the Xigua platform runs for less than five minutes.

The plan to build a streaming video service with long-form content has come at a time when ByteDance is said to be looking to raise as much as US$3 billion in a new funding round.

The company was reported to have met with potential investors for financing that could value the Beijing-based start-up at around US$75 billionThe talks have not been finalised and the amount and valuation could still change, the source said.

ByteDance would become the world’s most valuable start-up, the report said. The firm would eclipse Uber Technologies, valued at US$68 billion, and Chinese ride-hailing giant Didi Chuxing at US$56 billion, according to CB Insights data.

ByteDance’s foray into China’s online streaming video market would see the start-up compete in a market dominated by three major players – iQiyi, Tencent Video and Youku Tudou.

Those three players also happen to be controlled, respectively, by three of China’s biggest internet companies are Baidu, Tencent Holdings and Alibaba Group Holding its tech news site Abacus and San Francisco-based venture capital firm 500 Startups.