Happy NIU (牛/Ox) Year, readers!
It always annoys me when the Chinese New Year falls on a weekday. Ever more so this year. Having to work through the new year under lockdown in London, I have never missed so much the rowdy feasts around the table, the predictably unimaginative Chinese New Year gala (春晚) on TV, and the routine of snatching digital red packets (红包) on WeChat groups.
But hey, hang on there, folks! Fingers crossed that the year of ox brings back to us health and sanity, and meanwhile, a warm welcome to the latest edition of our China newsletter, Sesame Express.
This week’s handpicked topics are:
- Lunar new year travel conundrum: to go, or not to go?
- China’s subtitle army, not quite so black and white
- Forget about TikTok, the limelight is now on Kuaishou
1. Lunar new year travel conundrum: to go, or not to go?
Debate about this question dominated almost all my China-based WeChat groups, as soon as travel measures related to chunyun (春运), the home-bound travel for lunar new year family reunion, were made public.
Details: Travelling to high-risk areas such as those under local lockdown are banned. Those in medium-risk areas are required to obtain approval from local disease control authorities and present a negative Covid-19 test. Returnees to rural areas need to produce a negative Covid-19 test and undergo a 14-day “home observation” period with further tests, during which they can leave home but cannot take part in gatherings – same applies to anyone travelling from low-risk areas to Beijing. For the rest in the low-risk areas, “stay put” is encourage to prevent spread of the virus.
With fresh local clusters in parts of Hebei 河北 and Northeast 东北 (though at a minuscule scale compared to what we’ve got accustomed to elsewhere in the world), partially blamed on inadequate testing and quarantine abilities in rural regions, the government’s worry is not entirely unfounded. Truth be told, paying the heavy price for a few days of freedom over Christmas in the UK, I certainly see merits in such precaution. The impact was visible, as the world’s largest human migration saw its movement reduced by about 40% (see chunyun 2021 captured in photos by Sixth Tone).
That said, one unintended consequence is that the burden of the lunar new year travel restrictions falls disproportionately on China’s 300m migrant workers, for whom the lunar new year holiday tends to be the only time to see one’s children and aged parents after a year of hard work in faraway cities. Many of the same people, having bore the brunt of last year’s national lockdown, were understandably furious.
This time the government was swift to act – measures were quickly introduced to make up for the lonely new year:
- Wealthy cities offered financial reward for workers opting not to go home (Hangzhou 杭州, for example, handed out 1000 RMB or 154 USD per person).
- Other incentives included free food and mobile data, complimentary cultural activities or admission to local attractions.
- In some cases, additional points were granted for residency permit applications which, if successful, guarantee better social benefits such as education and healthcare.
- An order was also issued to grassroots officials, warning them not to add further restrictions on top of what is required, a common occurrence with local bureaucrats fearing for their job in case of local outbreak.
Too little too late? Perhaps. But at least a baby step in the right direction. What is more telling though is the speed of rectification, which highlights the government’s nervousness about the country’s destabilising social disparity.
Freebies aside, the predicament and brewing discontent of this sizeable group, comprising migrant workers, as well as their disadvantaged offspring (China’s left-behind kids 留守儿童 as featured by Sixth Tone), is unlikely to go away.
2. China’s subtitle army, not quite so black and white
“Farewell, Prometheus of the internet age.” Said one of my friend’s WeChat update. On the day that police raided RenRen Yingshi, an operator of China’s largest crowd-sourced subtitling site, YYeT.com (人人字幕组).
Fourteen were detained for film and TV piracy, and rightly so – copyright infringement is illegal, and a proliferation of pirated content on the Chinese internet has long been a big embarrassment. But my friend’s reaction to the news, echoing many others, reveals something else in RenRen Yingshi’s murky history.
- RenRen Yingshi was founded in 2003 by Chinese students in Canada, initially as a non-profit organisation sharing translated foreign films and TVs free of charge through the internet. It soon became well known for providing timely and quality Chinese subtitles for hit shows, such as “Game of Thrones” and “The Big Bang Theory”.
- As its popularity grew, RenRen Yingshi ran into trouble for copyright infringement. Most notably, in 2014, it was singled out by Motion Picture Association of America in a complaint to the office of the U.S. Trade Representative.
To sum up, RenRen Yingshi was a product of a bygone age where access to international content was difficult for most Chinese audience. Many from that era, while acknowledging its shady practice, have heartfelt thanks to RenRen Yingshi, likening it to Prometheus for bringing home the flame of culture.
Almost two decades on, as flourishing Chinese video sites throw big money for the copyrights of foreign shows, and with public awareness about copyright vastly improved at home, there still appears a genuine gap in the market that makes RenRen Yingshi, alongside other fan-subbing sites, difficult to eradicate (RenRen Yingshi reportedly has a register user base of 8m at its peak).
Despite ubiquitous legal streaming services today, access to good foreign media in China remains patchy, this time driven by regulations for importing foreign content. Limited quota, strict censorship (which causes delays and removal of sometimes important scenes), as well as a lack of rating system (thus default to child mode), leave many fans cold.
“China is the fastest-growing film market in the world, and it’s a top destination for European and American films — some Hollywood productions have grossed four times more in China than in the United States. Still, piracy has flourished, thanks to the National Radio and Television Administration’s quota system, which allows about 40 foreign films into Chinese theaters each year. (In the early 2000s, that number was around 20.)”(Quote from “China’s subtitle army” from Rest of World)
“I am more than happy to pay for uncensored, copyrighted overseas movies and TV programs, but the government doesn’t even give me the chance!”(Quote from “Chinese police raid pirate website that offers crowd-sourced translation” from SupChina)
When RenRen Yingshi was shut down, one comment left by a fan on the site read, “Invictus Maneo”. This is a quote from CBS’s drama “Person of Interest”, meaning invincible in Latin. I really hope otherwise, in which case punishment alone won’t do the trick.
3. Forget about TikTok, the limelight is now on Kuaishou
I still remember my first experience with Kuaishou (快手), when a friend showed me the app, a few years back on my trip home. I was dumbfounded – it unveiled such an outlandish yet mesmerising world, that completely alienated from my own. “A lens into rural China”, as SupChina put it, Kuaishou “shows us much more than Shanghai’s skyline or Beijing’s hutongs”.
Fast forward to today, Kuaishou, a short video pioneer with its business built on providing a space for people from China’s less developed areas, who in the past seldom have their voice heard, to share their lives and express themselves, have grown into a short video giant. Its blockbuster IPO on the Hong Kong Stock Exchange this month was hailed as “the largest tech IPO since Uber”. Tripling share price on debut attested to market’s enthusiasm, fuelling a lofty valuation of USD 160bn.
“More than 262m Chinese users check the Kuaishou app an average of 10 times a day, spending an average of 86 minutes watching videos and chatting with creators who make them.”(Quote from TikTok rival Kuaishou hits $160bn valuation as shares surge after IPO from FT)
Compared to its better known peer Douyin (抖音), TikTok’s Chinese sister app by ByteDance, Kuaishou is smaller, its 300m users about half of that of Douyin. There are also nuances in monetisation models – Kuaishou notably more dependent on virtual gifting and e-commerce via live-streaming, generally considered less stable than advertising revenue from corporates.
What is virtual gifting? In return for being entertained, viewers shower live-streaming hosts with virtual gifts, ranging from beer stickers (RMB 1.5) to golden dragons (RMB 1,400). These stickers, from which Kuaishou takes about a 45% cut, made up 62% of its revenue in the nine months to September last year.
The business model of virtual gifting is not free from controversy, as fans are known to have engaged in competitive gifting beyond their financial ability, incurring staggering debt in some instances. The government consequently banned underaged users from participating and has also urged platforms to cap users’ monthly spend.
With looming regulatory risk, to live up to the hype, Kuaishou has its work cut out to diversify the business. Sure enough, its arch-enemy ByteDance will be watching closely.