TVB that "sells starlight", can live broadcast goods get out of the predicament?

Reporter Han Xingtong

At noon on March 3, Hong Kong Television Broadcasts Limited (commonly known as: TVB) started the second Taobao live broadcast of the "delivery career". However, only a few days ago, TVB signaled that it would lay off 30% of its workforce to save 5 million yuan (Hong Kong dollars, the same below).

On March 3, TVB launched its second Taobao live broadcast. Photo courtesy of Han Xingtong

Under the attack of streaming platforms and emerging media, the grandeur of "spring breeze and horseshoe disease" is no longer there, and after passing the adolescence of barbaric growth, it has entered a dull and silent middle age.

TVB has tried to break through several times in the past, but the results are not satisfactory. But after all, the feelings are still there, and the generations that grew up watching Hong Kong dramas in the past have always had an inseparable nostalgia for that starlight. This time, TVB bravely broke into the live broadcast industry, seemingly successive. How far can "selling starlight" go, and can it become a new wealth code and break through the siege in the predicament of the Yingjing police for many years?

Has the worst passed?

TVB Executive Chairman Xu Tao said at last year's results meeting: "The worst is over. At that time, TVB announced a loss of 2021 million yuan for fiscal year 6.

When TVB announced its fiscal year 3 results on March 29, the annual loss expanded by 2022.24% to 7 million yuan, equivalent to a loss of 8.07 yuan per share, without paying dividends. People found that expectations were still too optimistic, and the decline of the traditional TV industry was almost inevitable.

Xu Tao sent a letter to employees announcing that he would introduce a cost and resource management optimization solution, with the goal of saving $2 million in annual operating cash expenditure. In human resources, about 6% of employees will be laid off. The company will also significantly adjust the program production budget, the old program production model will be transformed, and some programs that fail to meet the expected ratings and economic returns will be terminated.

Xu Tao said in the open letter that the epidemic has brought a huge impact on the economy and market, Hong Kong's economic prospects still have many challenges, and the television industry is facing a new era. In order to adapt to market changes, the company will carry out cost optimization management to ensure business stability and sustainable development.

After the open letter was issued, public opinion was in an uproar. According to the information, TVB has a total of 3907,<> full-time employees, including contract artists and staff of overseas subsidiaries. This figure excludes directors and freelance workers.

Subsequently, Tsang Zhiwei, General Manager of TVB's Program Content Operation, stressed in an interview with the media that this is not a major layoff, but only a natural loss of personnel, and that most of the lost employees belong to older executives and management, which is expected to involve 180 people, due to the Group's expectation of younger personnel and management.

Mr Tsang also emphasised that saving $2 million in costs does not mean affecting production quality, but rather cooperating with more media, such as mainland media, to save costs and increase revenue. He foretold more related collaborations in the future.

Zeng Zhiwei, General Manager of TVB Program Content Operations. Photo by Li Zhihua

Hong Kong drama scene implantation, Taobao live broadcast with goods won the first battle

At noon on the 30th, TVB actor Chen Minzhi sat in the "cabin" of "Rushing to the Sky" built by the real scene and started TVB's second Taobao live broadcast. This time, TVB extended the live broadcast time from 6 hours in the first show to 12 hours, continuing to use the characteristic signboard of "Hong Kong drama immersive live broadcast", after Chen Min, actors Chen Ziyao and Ma Guoming took over.

Since the start of the live broadcast, the cumulative number of views has soared to 100 million. The first live broadcast also achieved remarkable results, with sales exceeding 6.2350 million yuan in 320 hours of live broadcast, with a cumulative number of viewers exceeding 485.3 million, a cumulative number of viewers exceeding <>.<> million, and the highest number of online users exceeding <>,<>. Because artists Chen Hao and Chen Minzhi added Hong Kong drama elements to the live broadcast, they were hotly discussed by netizens, and related topics once rushed to the hot search.

It is understood that TVB reached a cooperation with Taobao this time and is expected to do at least 48 live broadcasts this year.

"TV media revenue mainly comes from advertising business, but due to the influence of the Internet and new media, as well as the change in user habits who are more inclined to the Internet and mobile phones, TVB's profit contraction is becoming more and more serious." Mak Cuicai, associate professor of the Department of Finance and Decision Making at Hong Kong Baptist University, told Chinanews.com that although TVB is already the largest TVB in Hong Kong, its business scale continues to shrink, so it must change its profit model to survive.

Selling products through TV channels to make a profit, TVB has tried repeatedly in the past few years. As early as 2021, TVB invested heavily to acquire a 75% stake in Hong Kong's local e-commerce company Shito. In 2022, TVB opened three exclusive goods accounts on Douyin: TVB Goods Recognition (Hong Kong-style selection), TVB Goods Recognition (delicious selection) and TVB Goods Recognition (Hong Kong Strict Selection).

"The biggest asset of a TV station is its reputation and its artists, how can it monetize this? It's live streaming. Mak believes that this model is tantamount to TV sales in the past, but it further breaks through the time and broadcasting regulations on live TV, so as to drive the company's profitability more actively.

The sustainability of "Starlight" is questionable

Can TVB turn a profit from this? McTri has reservations about this. Although the star effect and emotional connection at the beginning can bring gimmicks and traffic to the live broadcast room, the sustainability of this way still has to be questioned, after all, in the highly competitive live broadcast industry, the final fight is nothing more than product price, quality and sales.

In fact, the product quality and after-sales service after TVB's first live broadcast have been thrown out by consumers one after another, and there is no obvious product category in the live broadcast room, and there is no obvious advantage in product price, which has become a potential suffocation to the road of TVB live broadcast delivery.

In Mak Cuicai's view, TVB must take the road of live broadcast and goods, and the most urgent task is to clarify the target audience as soon as possible, such as residents of the Mainland cities in the Greater Bay Area who are deeply influenced by Hong Kong dramas, have the same language, and are within the scope of TVB's radiation, as well as Southeast Asian countries such as Malaysia and Singapore. "Hong Kong locals are not accustomed to the form of online live shopping, and Hong Kong's small population base will not contribute much to sales. The influence of TVB in other parts of the mainland may not be so great, and if TVB can target the mainland cities in the Greater Bay Area, this market will be very different from Hong Kong. ”

Just before the start of TVB's second Taobao live broadcast, the stock price of parent company Radio and TV rose significantly, once rising 16% to 11 yuan. Whether it is the market or the old fans of Hong Kong dramas, they are looking forward to seeing TVB, which has created a ratings myth with dramas such as "Golden Bough Desire", "Genesis" and "Pearlescence", once again blooming in the e-commerce market.