At the helm, the stock price doubled in half a year, and Cheng wumou made a new situation: “Internet Film and television aircraft carrier” has taken shape


■ company: Yuewen group (0772. HK)
■ market value: HK $65.5 billion (closing on 23 October)
■ core competitiveness: the pioneer of online reading industry, the pioneer of payment mode of Chinese online literature, occupying half of the online literature world, rich product matrix and firmly controlling the source of IP
Companies in the eyes of institutions: the leading digital reading platform in China and the absolute leader of literature IP
Cartographer: Dong Xingsheng
“This is not a simple press conference of the three companies, nor is it just for the film and television field to be isolated, but the ecosystem constructed by the entire IP.” On October 19, Cheng Wu, vice president of Tencent group, CEO of Yuewen group, CEO of Tencent pictures and chairman of Tencent animation, announced to the outside world that Tencent film, Xinli media and Yuewen film and television, the three enterprises under Tencent and Yuewen, will be deeply integrated and complementary in their advantages to build Tencent’s new culture creation.
Photo source: by reporter Du Wei
On the same day, “Tencent pictures, Xinli media, Yuewen film and television 2020 annual conference” gathered, and announced the film list of 56 projects, attracting the attention of all parties. Since the top management of Yuewen group (hereinafter referred to as Yuewen) reshuffled on April 27 this year, the senior management of Tencent, represented by Cheng Wu, has entered the core management of Yuewen. The outside world is full of expectations for the future development strategy of Yuewen. From April 28 to October 23, Yuewen’s performance in the secondary market also confirmed the capital’s expectation: in 122 trading days, the stock price increased by 101.88%, and the stock price reached a new high in two years. As of October 23, the market value was HK $65.5 billion.
In the past six months, Cheng Wu did not stop and proposed the development strategy of starting the organizational reform of reading and comprehensively upgrading the reading. The integration of Tencent as a “troika” is another drastic reform after Cheng Wu takes over the reading of the articles, and it is also an important step for reading to go out of the strategic upgrading.
What kind of Internet innovative thinking and understanding of the new cultural and creative ecology will Tencent take to implement the strategy? “Daily economic news” reporter and Cheng Wu in-depth dialogue, listen to Cheng Wu’s interpretation of his big game in Tencent film and television.
The coupling degree between industries is not high
New ecological infrastructure with IP as the core
Two years ago, under the leadership of Cheng Wu, Tencent upgraded the concept of “Pan entertainment” in version 1.0 to “new culture and innovation” in version 2.0. “The core is to consider the needs of users. In addition to the needs of social networking and watching news, the public also has a huge demand for online text, animation and online film and television business.”
The mobile Internet and intelligent terminals can connect and link the user’s needs quickly. However, there are few companies that can thoroughly connect the industry chain. In Cheng Wu’s opinion, even in a mature and talented film and television industry like Hollywood, there is still a “721” phenomenon, that is, seven of the 10 films are losing money, two are even, and only one is profitable. It is worth mentioning that 35% to 40% of Hollywood’s films make profits at the box office, while others rely on DVD, derivatives and licensing industries. In China, this problem is particularly prominent. “China’s film and television industry profit less than 10%, because our industry chain has not been set up, the return on investment depends on box office income.”
Photo source: from Yuewen group
Therefore, once a large film loses money, it will make a film and television company suffer heavy losses. “Cultural industry is creativity in the final analysis. The biggest characteristic of creative industry is high risk, because the core of creative industry is to innovate. The biggest problem of innovation lies in high failure rate and low success rate.” Cheng Wu pointed out that film and television have the widest coverage and the most vivid forms of expression, but the innovation risks lead to a high failure rate in the industry.
“A film cycle may be as long as 10 years, the investment is often very large, the social division of labor is very strong, and the shooting process also has to go through various complex factors such as weather, and after the shooting is completed, it still depends on the schedule, so its systemic risk is the strongest.” Cheng Wu believes that in order to reduce the risk, we must “help each other and combine the contents of different cultural industry chains to do a good job of industrial ecology, so as to bring greater opportunities to different industrial chains”.
Nine years ago, when Cheng Wu Gang set foot in Pan entertainment, he found that he could not do film and television in isolation, and that the single industry was relatively vulnerable when encountering twists and turns. At present, the coupling degree between industries is not high enough, “each industry can not overcome its own shortcomings and difficulties, and also has its own ceiling”.
From the perspective of IP adaptation, the text imagination is rich, but the form of expression is single; animation is in the middle, but relatively vertical minority; the investment cycle of film and television is very long, and the success rate of game is lower than that of film and television. “Each of them has its own advantages and challenges. We want to lay out all the fields in order to meet the different needs of users around the content. Instead of fighting for each other, we should integrate them and learn from each other’s strengths and weaknesses. ”
Film and television companies can not reduce the systemic risk in the vertical field, so they need to plan and judge from the source and the earliest IP links: which have long-term development value and which are suitable for different industrial links, and then conduct combination and linkage to better develop IP works and realize the coupling of content industry chain.
“In the past, IP development cooperation was based on a single transaction based on the logic of sale and purchase, with zero sum game based on IP consumptive adaptation. In the animation, film and television, game adaptation and other links, reading lacks the ecological partners who are jointly committed to the construction of IP influence and centripetal force. ” Cheng Wu said.
Therefore, after practicing the 1.0 and 2.0 modes, Cheng Wu believes that Tencent pictures, Xinli media and Yuewen film and television all have a new content ecological infrastructure layout with IP as the core. However, the basic capabilities of each module are far from enough. “So this year we want to really integrate them. We should not only do a good job in the vertical field, but also do a good job in the overall IP three-dimensional long-term planning. This is the starting stage of our third stage, which needs to be adjusted constantly in the process of practice and running. ”
Gambling is short-term finance
The strategic value of Xinli for reading articles is not a realization tool

In Cheng Wu’s new cultural and creative ecology, film and television as an IP “amplifier” has a core value. Therefore, IP film and television is an indispensable part, but it is also the most difficult link in ecological construction. The uncertainty of creativity increases the potential risk, so “integration” becomes a necessary step.
Among the three companies, the fate of Xinli media is the most concerned. In 2018, Yuewen bought Xinli media for 15.5 billion yuan. At that time, the capital of the film and television industry was in a cold spell. The valuation of 15.5 billion yuan was not cheap. Since then, in 2018 and 2019, Xinli media has not completed the performance gambling for two consecutive years. At the end of 2019, Xinli media mainly participated in the production of “Qingnian Nian”, which exploded on the screen. However, the impact of the epidemic on the film and television industry can not be ignored. In the first half of 2020, Xinli media’s revenue and operating performance still did not meet the expectations, which hindered the first cash loss of Yuewen. The impairment of goodwill and trademark rights related to the acquisition of Xinli media was as high as 4.41 billion yuan.
“Even after Yuewen’s acquisition of Xinli, the two have not achieved real linkage and integration, so Yuewen lacks the creative ability to transform excellent online works into systematic Xinli.” Cheng Wu does not deny that after Xinli media was acquired by Yuewen, the integration of the two has not produced a perfect chemical effect.
However, Cheng Wu expressed a long-term optimistic view of Xinli media, which should also be the ultimate goal of Yuewen acquisition. “Gambling is a short-term finance. The strategic value of Xinli media for reading articles is not a tool to realize, but should become the most capable team and unit in the process of excellent IP film and television transformation, which can transform more excellent works into films and expand its influence.”
“The first quarter of Qingnian has been a success, and we hope to turn this few practical projects into batch, large-scale and long-term projects through systematic integration.” Cheng Wu hopes to be able to read a large number of high-quality IP into more “celebrate more than a year.”.
In the past 10 years, Cheng Wu has witnessed the development of Tencent in the field of social network, and how Tencent games have grown into the largest and most influential platform in the world, and deeply participated in and promoted the content plate based on social network and game business. For the positioning of the “troika”, Cheng Wu has a clear plan: “in the film and television link of IP transformation, the three companies have few overlapping fields, but there will be a lot of linkage and mutual coordination.”
Mao Dun literary award work “the world” will be jointly created by Tencent pictures and Xinli media
“Xinli media mainly focuses on TV dramas, supplemented by movies, and produces top-quality products. It produces 6-10 films a year. Whether it is the adaptation of reading IP, or in the creation of realistic themes, we can maintain excellent continuous production and output. ” But at the same time, Cheng Wu also pointed out that a company’s bandwidth is relatively limited, and the other two need to be consolidated.
Cheng Wu further said: “Tencent pictures takes the lead in creating good works together with the industry’s outstanding creative team, mainly focusing on the main investment and control, and self-made, with equal emphasis on TV dramas and films. However, Xinli media and Tencent pictures have a limited number of self-made, main controlled and main investment adaptations each year. Therefore, Yuewen film and television will rely on Yuewen IP, mainly on concurrent training and investment, supplemented by customization of some platforms. ”
At the same time, Cheng Wu stressed: “the three brothers will each take out the best pieces of board, open cooperation with partners, live up to every good work, and constantly explore the value space of each IP.”
Press conference site
A clear positioning will enable the three companies to borrow resources and complement each other. However, the three companies also have overlapping businesses. How to allocate resources reasonably for each IP?
“We will set up a film and Television Committee. Cao and I (Cao Huayi, chairman of Xinli media) will co-ordinate the film and Television Reform of all IP, including standard setting, judgment and grasp. There will also be different teams, such as those responsible for IP creation, which IPS are suitable for which company to take the lead, and how to cooperate with each other. ” Cheng Wu laughs that the film and Television Commission has learned from the Disney model and the Japanese ACG Copyright Committee model. However, at this stage, it is still a new practice to cross the river by feeling the stones, and it needs constant iteration to do better.
The transformation is indisputable, upgrading to “the ecology of literary content”
Investors and the capital market are particularly concerned about the impact of reading articles on listed companies. What kind of development opportunities will be obtained after reading articles are integrated into Tencent? This time, Cheng Wu has launched the integration of the “troika”, which is actually the transformation and upgrading of Tencent’s reading business ability, whether it is the systematic transformation of IP or the role orientation of Xinli media.
From the perspective of corporate value, the most important thing for investors is whether the company can continue to grow and continuously create value. For reading articles, it is the IP operation ability. If the IP ecology Tencent wants to create is realized, the risk brought by film and television creativity can be reduced to a certain extent. Generally speaking, it is to continuously produce “more than one year”, which may be film and television, animation, games, etc.
Cheng Wu frankly said that after taking over the reading, he made constant adjustments, hoping to build version 2.0 reading, and promote its upgrading from “the largest industry legitimate digital reading and literature IP cultivation platform” to “stronger literature content ecology”, which is “not only the adjustment of strategy and business, but also the upgrading and transformation of organization and culture”.
Before the senior management of Tencent, represented by Cheng Wu, entered the review, the share price of Yuewen once hovered at a low level from March to April this year, with the lowest ever reaching HK $25.95. However, since the exchange of high-level personnel on April 27, the share price of Yuewen has been rising. As of October 23, the share price of Yuewen has risen. As of October 23, the share price of Yuewen has doubled from the March low, with a market value of HK $65.5 billion.
After Cheng Wu took over the book reading, its share price rose 101.88% in 122 trading days, reaching a two-year high (photo source: wind)
However, it is not easy to maintain a bright performance in the capital market. When talking about the thinking on the market value management of Yuewen, Cheng Wu specially told reporters that reading is the core component of Tencent’s new cultural innovation strategy and ecology, and market value is one of the external manifestations of the company’s value. In the eyes of Tencent and Yuewen, the focus is still on long-term strategic planning and business development.

“As a listed company, we must be responsible to shareholders, but a good capital market needs to be long-term and sustainable. After I took over and read the paper, I and the management team hope that under the guidance of the new strategic direction, we can do a solid job in every step, upgrade the organization and talents, and at the same time, we can complement the actual ability of each sector and make them stronger. Only by focusing on the main business can we make good use of the performance and enhance the confidence of investors and the market. ”
The second season of “Qingnian” was officially launched at a press conference on October 19
Cheng Wu added that in the next year, resources will be invested to enhance IP incubation capacity. “Content and IP are the core assets of reading, the foundation of our business value and the biggest competitive advantage. Secondly, the platform will be improved, not only as a content distribution center, but also as a link between writers and users. At the same time, a strong link will be established between reading and Tencent’s product matrix, so as to achieve wider user coverage and enhance the connectivity of the platform by taking advantage of Tencent’s traffic advantages. ” Cheng Wu further said that it will also strengthen the IP centered ecosystem and fully release the growth space of IP.
Cheng Wu expects to build a “group army of cultural content entertainment industry”. It must adhere to long-term principle, respect the long-term content layout of IP value, and lay a better foundation for the long-term performance of the capital market with good business performance and actual performance. “Tencent has a long way to go for the transformation of reading articles this time, and there is no dispute in the day and night.”
The participation and reshaping of Internet enterprises in China’s film and television industry has entered a new stage
In November this year, Cheng Wu will celebrate his 11th anniversary in Tencent.
Since joining Tencent in 2009, Cheng Wu has been involved in a number of sectors, from social networking, game business to film and television business, and then to taking charge of the first reading group of China Netcom this year. He has been infiltrating the field of culture and innovation for many years, and has put forward the concepts of “IP”, “Pan entertainment” and “new culture and innovation”.
Cheng Wu’s integration of the “troika” is of great significance to the industry. It is regarded as a sign that “Internet enterprises have entered a new stage in the participation and reshaping of China’s film and television industry”, and it is also an important event that can be “recorded in the history of China’s film and television industry”.
Cheng Wu is well aware of the importance of reading the Internet environment for Tencent’s IP strategy, because there are not many successful adaptations from literature IP, and the industrialization system is far from being formed. Therefore, it is necessary to speed up the integration of its several major content business sectors, form a “1 + 1 + 1 > 3” content industry chain coupling, and build a broader content industry ecology.
During more than one hour’s dialogue, the reporter deeply felt that under the leadership of Cheng Wu, the “troika” will help Tencent’s new cultural innovation enter the era of 3.0 through internal linkage and external cooperation, and the next “more than one year of celebration” is ready to go. As Cheng Wu said: “good ideas are always scarce and need to be hidden in the sea. Only by building a broad content industry ecology can good content continue to grow.”
Only in this way can China’s digital content industry develop in depth and high quality. It is believed that under the promotion of Cheng Wu, Tencent will build a strong content matrix of literature, animation, film and television, e-sports, etc., and Tencent’s “new cultural and creative” ecology is also expected to become a Chinese cultural symbol.
Reporter: Du Wei
Editor: Dong Xingsheng
Vision: Liu Yang