On the surface, this is a win-win deal. Big gold owner Ali has bought money for the market, and television box makers have made a lot of money.
However, in Shenzhen, where TV box makers gathered, the news came very differently. A box manufacturer from Shenzhen said to the electric technology that he could not help but said, "This is not good, Ali's subsidies have killed everyone."
In the past two years, Alibaba Entertainment has collected 70% of OTT terminals on the market to YunOS through a subsidy policy for TV box manufacturers. According to incomplete statistics, China sold about 20 million TV boxes last year.
This seems to be an intractable paradox. Why is it that the golden money-thrower has put everyone to death? Why did the hardware manufacturers retire from the initial pursuit of subsidies, to later unrest, and then to the current emergence of withdrawal.
Ali's huge subsidies are used in the price war
Prior to Alibaba's large number of entertainment introductions of huge subsidies, Shenzhen manufacturers, which are the gathering place for television boxes, are facing a transition. Many board manufacturers have begun to transfer backlogs of inventory to boxes.
In 2013, the gross profit of the single box of the box remained at more than ten dollars. By 2014, the number of people entering the market was reduced to five or six dollars.
Just at this time, Ali's subsidy policy for entertainment was introduced. As long as each TV box is pre-installed with YunOS, users activate the system, Ali will give equipment manufacturers a subsidy of 20 to 30 yuan. If Taobao and Alipay are also installed, they will directly subsidize 40 to 60 yuan.
Last year, due to policy reasons, the domestic TV box market suffered a cold winter, sales were almost paralyzed, and box manufacturers had to treat Ali's subsidies as a straw to survive.
From the outsider's point of view, as long as they take subsidies, manufacturers can make more money. However, the fact is that because of the existence of high subsidy, the number of manufacturers that have joined the manufacture of television boxes has started to increase, and these subsidies are eventually used by manufacturers to fight price wars.
"My box was supposed to sell for 140 yuan, and you sell it for 140 yuan. If I took the subsidy of Aliyun 30 yuan, most manufacturers would sell the 140 yuan box to 110 yuan, hoping to depress the business with the price. However, if the business partners see this situation, they could have remained independent, and they would only be able to ask for subsidies at Ali's entrance, otherwise they would have to wait for the death. "A Shenzhen TV box manufacturer described the market situation to X-Tech.
The person added, "Because there are subsidies at the bottom of the market, everyone is now pushing prices down so much that nobody dares to raise prices. The profit margin is actually compressed."
At a glance, this incident does not seem to have a direct relationship with Alibaba Digital Entertainment. It seems that Ali has only provided subsidies, and the final implementation of the irrational price war is Shenzhen major TV box manufacturers.
In reality, it is not. Because in the terms of the subsidy policy, Ali has a requirement for the sales volume of the manufacturer's box. Only selling enough number can obtain the corresponding subsidy.
It's like the complaints of the drivers who are drunk today. "Dripping requires us to run 15 single-arrival orders a day. If we run dissatisfied, we will not have subsidies. Now we make part-time jobs just like professional drivers. In the evening, just to finish the 15 orders, I will not work again next month or go to work honestly. This money is not good."
Behind the carrots, there was a big stick forever. Ali was undoubtedly the great hunting hunter.
A box maker told electric technology that if the annual shipment is half a million, it means that the manufacturers will sell 40,000 units a month. It is very stressful for small manufacturers, and subsidies are paid for security. We can only cut prices. In the end, it is better to find that there is no subsidy. Everyone is also competitive.â€
Carrots and sticks eventually led to a bad result. No one was profitable. In this seemingly lively subsidy show, every participant was scarred. In particular, Ali spent hundreds of millions of dollars and ended up with one. Bad review, this is certainly not Ali's original intention.
What's even more frightening is that in the end everyone found out, "What I'm selling is exactly the same as what you're selling. There's no difference."
"Actually, profit-driven Shenzhen firms are extremely sensitive. They have barometers of their own. Look at local consumer newspapers in Shenzhen. TV boxes last year accounted for 7 or 8 pages of advertisements. Only half of the page is left this year. However, driving recorders and sports DVs accounted for 78 pages, "said an industry investor as saying to electric technology.
According to the survey of electric technology, Shenzhen's small and medium-sized manufacturers are now reluctant to get involved in the OTT market, and large manufacturers have also begun to seek transformation. For example, Infik has started to invest in driving recorders, sports DVs and other products.
The lost television box market began to allow manufacturers to flee.
A good game is defeated when it is full.
In the Internet industry, there have been two successful models. One is the Apple model and the other is the Google model.
In Apple's industry chain, from the source of the OS to production and then to sales, Apple is in the end.
Googleâ€™s Android, which is an extremely open system, is entirely responsible for the management of other mobile phone brands.
"Why did Ali save his money but he didn't receive praise, and what is the dignity of local tyrants?" Analysts believe that referring to the two models of Apple and Google, Ali YunOS's entire subsidy system integrated Apple and Google, but they only made half of them. This half is a short board.
YunOS learned Apple, the control of the OS, the content of this one, but left out the manufacturing and sales, leading hardware manufacturers to become Alibaba YunOS foundry.
YunOS studied Google, and gave the OS permission to everyone to use it free of charge. However, the support for developers has not been implemented, and the ecosystem has not been able to run. Android-based mobile phones still have excellent players like MIUI. YunOS will always be the only one under him. When Ali added the OTT market, he did not do quality control. The product had a problem, or those manufacturers dealt with it themselves. It does not matter whether some small plants have perfect after-sale capabilities.
All in all, YunOS has neither the openness of Android nor the lack of Apple's ecosystem. "A lot of our peers don't use YunOS this year. We don't want to use it anymore. The market is messy, and everyone's content is the same. It's not easy to sell." Hardware vendors said.
"When Ali first shot, he had taken a good move and used the fast speed to collect the chaotic box market. But after desperate subsidies and enclosures, he did not have enough excellent operations and development. The good situation was disturbed and everyone was injured, "says an industry analyst.
In the first half of 2014, the domestic TV box market was still in a period of benign development. One of the manufacturers was hoarding a lot of low-quality chips and boards that were poorly sold and on the verge of bankruptcy, but later they enjoyed Aliâ€™s subsidies and started to go lower prices. Dumping route, instant strong, straight to the industry counterparts shouted can not understand, because this manufacturer to take the amount of goods, in the box configuration to play off the public war Qin Qiong against technical iterations, take 8-core CPU with 512M memory, As a result, it outperformed other manufacturers in the total price, and eventually successfully digested inventory and deceived numerous consumers.
Even more frightening is that Ali is indifferent to this. As long as it sells, it still supports the manufacturer as a major brand. As a result, most of the current manufacturers with brand awareness and R&D capabilities have collectively fled YunOS, or simply fled the TV box market.
YunOS headache for YunOS
Although some sources pointed out that there were a lot of dissatisfactions among the elders inside Ali at the time of this subsidy policy, it was a â€œshameful thingâ€ to think that Aliâ€™s holding the worldâ€™s largest sales channel and using the cash subsidy method to pick up the market.
"A lot of things inside Ali are not understood, and there is a lack of communication between various departments. Under the pressure of the KPI, there will be deformed and brutal means." Insiders analyzed.
A few months ago, Electric Technology had published articles that blindly encouraged the development of applications or introduced developers into Alien Circle, and talked about Ali's urgent entry to make developers fall into the blind circle of blind development.
What about Ali YunOS itself on the TV?
"From the developer's point of view, the YunOS on the TV is not friendly. We can't find its developer website and there is no developer documentation. The product is difficult to adapt. After all, the hardware vendors have to be a bit different. Making a bottom-level change to Alibaba's ROM causes an application to have different problems on different boxes. Usually when problems are encountered, they are told to find the corresponding box vendor, and the manufacturer's managers are often powerless." CP said to Electric Technology.
On the other hand, Ali YunOSâ€™s "universal terminal" has smashed the discrepancies in the TV box market, resulting in about 70% of TV boxes on the market.
"The subsidy also caused the box's channel value to be seriously underestimated. The boxes are now mostly sold in the electronics market. After the dealers get the goods, they will receive offline training. The salesman needs to demonstrate the contents of the box to the consumers. So, as long as there is content, The miscellaneous brand box is very willing to ask, this makes the manufacturer who has made great efforts to do the brand very helpless, in the user's opinion, the interface and content of both are similar, "a CP describes.
"This evil cause our CP to talk to the hardware manufacturer to pre-install now, will find the small manufacturer does not play, the big factory asks you to ask the money, does not give the money not to give the money, the hardware bonus does not have, they will find The channel's profitability, which in turn kills the enthusiasm of the vast majority of practitioners, is probably the most profound and most detrimental effect of the implementation of the subsidy policy. After all, before the rise of the industry, the channel will have to be riddled with CP wool. It's reasonable, everyone is in the winter, you grab my jacket, I'm dead, your channel has no content, and will not live."
A subsidy has forced the industry into a dead circle with a bayonet, and it may have never been expected by anyone. This is also the basic reason why many box manufacturers in Shenzhen do not want to stay with Ali.
If you look closely at the current Internet industry, you will find that the "enclosure movement" of emerging industries abounds. The Internet giants attempt to solve all problems with money.
However, due to contempt of the industry, misjudgment of the market, and superstition of KPIs, many grassroots manufacturers have become victims of giant competition. The market's active power is often from these grassroots manufacturers.
"Actually, there are more ways for Alibaba to enter the entertainment market. For example, to help small companies make differentiated services, optimize product experience, and guide product development. Now that the environment is not good, it is too difficult to remedy the situation." Saying, "It's difficult to cover the water and we don't plan to continue playing."
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