This "Share Purchase Agreement" is the "Baidu Acquisition of YY Incident". It was signed on November 16, 2020. Baidu acquired YY Live Broadcasting, a subsidiary of Huanju Group, for a total price of approximately US$3.6 billion in cash.
Although Baidu "regrets the marriage", it still gave part of the "betrothal money".
In 2021, Baidu has paid a total of US$1.9 billion to the joint management account designated by Huanju Group and deposited a total of US$1.6 billion into multiple joint management accounts.
In other words, Baidu has paid a "bride gift" of US$1.9 billion in advance. However, after Baidu regrets the marriage, whether it can get back the gift depends on the subsequent negotiations between the two parties.
Currently, Huanju Group is very dissatisfied with Baidu's suspension of acquisitions, saying that the company is seeking legal advice and will consider all options for its disposal.
The acquisition case that has been delayed again and again
In the eyes of the outside world, Baidu’s acquisition of YY Live at a sky-high price of US$3.6 billion seemed to have been almost settled in the past few years, but in fact, the deal has been delayed again and again.
According to the "Share Purchase Agreement" signed in 2020, approximately US$2 billion must be paid to Huanju Group on the acquisition settlement date; approximately US$1 billion must be paid on or before April 30, 2021; approximately US$300 million must be paid no later than Payment will be made on the closing date or June 30, 2021, and up to US$300 million will be paid after certain conditions are met.
That is, no later than June 30, 2021, Baidu will deliver all the US$3.6 billion acquisition payment to Huanju Group.
Huanju Media announced on February 8, 2021 that the sale of its yylive business to Baidu has been basically completed. At the same time, most of the staff of YY Live have moved to the Baidu Building in Xierqi to work. The oa system used internally is Baidu's "Ruliu", and the entry information also shows that they are "Baidu employees".
But on August 17, 2021, Huanju Group announced again that Huanju Group and Baidu had agreed to extend the final deadline for the proposed transaction.
This delay is indefinite.
yy Live Why is the acquisition case of yy Live so twists and turns, and it has even failed directly today. The reason is that YY Live has gradually transformed from a high-quality asset to a non-performing asset, which is not worth the sky-high price of US$3.6 billion.
At the beginning of the acquisition, the outside world was very optimistic about the prospects of "Baidu + yy live broadcast" and believed that the two could complement each other. Baidu has more than 600 million monthly active users and has technical advantages in addition to traffic; and yy can also enrich Baidu's live broadcast ecosystem. , to realize the realization of traffic.
Baidu has high expectations for yy, and specifically mentioned yy live broadcast in the 2020 financial report and included it in Baidu's annual finance: yy live broadcast's total revenue in 2020 reached 9.95 billion yuan, accounting for 9.3% of Baidu's total revenue ; Net profit was 3.141 billion yuan, accounting for 16.5% of Baidu’s net profit.
However, on November 18, 2020, Muddy Waters released a report accusing Huanju Group of short selling. The short-selling report alleges that Huanju Group’s revenue from YY live broadcast is suspected of fraud, and paying users are actually robots operated by Huanju’s internal network; nearly 90% of YY live broadcast business revenue is forged data, and the revenue data of international live broadcast business bigo live also has 80% % counterfeit ingredients.
Baidu responded at the time that it had conducted financial, legal and commercial due diligence. In addition, Baidu modified some terms and conditions of YY Live’s original share purchase agreement.
The muddy water report was like a sharp sword that punctured the bubble of yy live broadcast, and yy live broadcast then began to decline rapidly. According to the "Annual Comprehensive Analysis of China's Entertainment Live Broadcast Market in 2022" released by Analysys Qianfan, the top three platforms in the entertainment live broadcast industry are Huajiao Live, Yingke Live, and Xiuse Live; while yy Live is not even among the top 20.
The popularity of yy live broadcast gradually disappeared within Baidu. In subsequent financial reports, Baidu did not mention a word about yy live broadcast.
A platform that is not ranked in the top 20 is certainly not worth the sky-high price of 3.6 billion U.S. dollars. It is reasonable for Baidu to give it a cold treatment and return the product for refund.
The old live broadcast platform has come to an end
As one of the oldest live broadcast players, yy, founded in 2005, was once the largest game voice communication platform in China and can be said to be the "first generation Internet celebrity" in the early days of the Internet. In 2011, yy launched the live video function.
The earliest stage of yy live broadcast was mainly game live broadcast. It often held online live broadcasts in conjunction with e-sports events, attracting a large number of game players. Later, he promoted live broadcasts of shows, mainly singing, and even contributed to the birth of "Shouting Mai Culture".
In 2016, the "Thousand Broadcast War" officially broke out. According to a report released by the China Internet Network Information Center, in 2015, there were nearly 200 online live broadcast platforms in China. By 2016, this number had increased 10 times, and there were more than 2,000 live broadcast platforms of various sizes. Daily active users reach an astonishing 24 million.
In that "thousand broadcast war" comparable to Dunkirk, yy live broadcast became one of the few live broadcast platforms that had the last laugh. On January 17, 2018, yy's stock price reached US$141.95, with a market value of US$9 billion, creating a record high for Huanju Group since its listing.
In 2020, YY live broadcast is also at its peak. According to data from the China Business Industry Research Institute, YY Live ranks first among domestic entertainment live streaming platforms with 41.204 million active users.
It is precisely with this impressive record that yy live broadcast won the favor of Baidu and was acquired by Baidu at the end of 2020.
Although the future stories are not as exciting as the glorious moments, yy live broadcast is still an indispensable role in the live broadcast track.
Yy Live is not the only old live broadcast platform that has gradually become lonely. Under the "encirclement and suppression" of short video platforms for many years, the old live broadcast platforms have long been in decline and have gradually become the tears of the times.
Douyu, the former “Live Broadcasting Brother”, is very similar to YY Live Broadcasting, both focusing on shows and games. It was listed on the New York Stock Exchange on April 22, 2019, with the highest share price reaching $20.54 per share. At its peak, the annual revenue was nearly 10 billion, the average monthly MAU reached 174 million, and the number of paying users was 7.6 million.
Douyu’s just-released third-quarter report is not pretty. Single-quarter revenue decreased by 24.42% year-on-year. This is the seventh consecutive quarter of year-on-year revenue decline.
Douyu not only experienced shrinkage in sales, but also moved from the economic channel to the legal channel. On the evening of November 21, Chengdu police officially announced: Douyu CEO Chen Shaojie was formally arrested on November 16 on suspicion of opening a casino. As soon as the news of
came out, Douyu’s stock price plummeted. Its current market value is only US$293 million, which is a drop of more than 90% from the high point in 2021.
Chen Shaojie’s imprisonment has sounded the alarm for all live broadcast players. Now that supervision is gradually being implemented, the era of barbaric growth of live broadcast platforms has passed, and the live broadcast format of earning eyeballs and cutting leeks by sidestepping and gambling has also become Past tense.
But for YY and Douyu, which are early Internet products, they cannot produce short video content or e-commerce products, and their profit model is too single.
Finding innovative points of live broadcast revenue has become the most important key for every live broadcast platform.
In addition to its single profit model, competitors will not let go of established live broadcast platforms, and poaching anchors has become commonplace.
Douyu’s head anchor Xuxu Baobao, who has been off the air for nearly two months, announced that his contract has expired and he will leave Douyu, which has been live broadcasting for 5 years, and go to Douyin. On the first day of Douyin's premiere, it received 60.11 million views, and the highest number of people online in the live broadcast room reached 2.248 million. It gained nearly 3 million followers at one time, and even wealthy fans rewarded it with 20 million.
Another anchor, Zhang Daxian, stopped broadcasting on Douyu for 104 days and switched to Douyin. On the day of the live broadcast, he received more than 1 billion likes. Douyin hourly list and popularity list also ranked first on both platforms. The cumulative number of viewers reached 69.62 million visitors, and the number of fans jumped to 48 million overnight.
Zhang Daxian
Such a huge traffic is obviously unmatched by Douyu, and it also makes many Douyu anchors jealous. At present, in addition to Zhang Daxian and Xuxu Baobao, top anchors such as Feng Timo, Sky Li Xiaofeng, and Leng Yanhua have all switched jobs from Douyu to Douyin, and even Douyu’s top anchors have basically moved on.
is similar to established live broadcast platforms such as YY and Douyu. It is limited by its life cycle and lacks new content as a breakthrough point. As for Doukuai, which has short videos and products, it undoubtedly has more ways to play. At the same time, in the later stage, diversified monetization can be achieved through advertising, live streaming, etc.
For anchors, showing off their beauty cannot last long, and they need broader development opportunities. As for the platform, the show needs new stories.
