The rise of Internet TV has always been driven by a desire to innovate in marketing and disrupt traditional business models. Following the trends of VR and AR, this year, AI has become the new hot topic. However, despite all the hype, the reality for many Internet TV brands hasn't been as promising as expected. Take LeTV, once a pioneer in the Internet TV space, which initially captured the market with its aggressive sales strategies. But now, it's facing a major crisis, with declining sales and a tarnished reputation.
Although other Internet TV brands continue to experiment with creative and sometimes controversial marketing tactics, consumers are gradually returning to rational decision-making when it comes to purchasing TVs. The initial excitement around new business models and technological "upgrades" has started to fade, revealing that these innovations may not be as groundbreaking as they seem.
One of the most controversial aspects of Internet TV is the use of advertising as a core revenue driver. Unlike traditional TV, which relied solely on hardware sales, Internet TV shifted to a "hardware + content" model. Whether it's free hardware or free content, the balance between different revenue streams often leads to aggressive money-burning strategies. Advertising has become an essential tool for generating profits.
From start-up ads, shutdown ads, pre-program ads, mid-play ads, app launch ads, to even dormant ads—Internet TV without a VIP subscription feels like a digital billboard. This model isn’t really innovative; it’s just shifting the price war to a new platform. In the past, traditional TV manufacturers outmaneuvered Japanese and South Korean competitors through superior pricing and marketing. Now, Internet TV’s tricks are nothing more than recycled ideas from the old guard.
Content and membership-based competition might sound appealing, but without a solid user base, it's like building castles in the air. Worse still, traditional TV manufacturers have also started following this path. Some reports suggest that one brand’s ad revenue from installed ads has already matched that of Hunan TV for the year.
The real lesson here is that advertising teaches users to pay for content. While the Internet economy is moving toward a paid model, it requires suppliers to offer something truly unique. Simply removing ads isn’t enough—it can be misleading and unhealthy for the market.
Another trend in Internet TV is the obsession with hardware specifications. Companies love to hype up their products by constantly upgrading components. But how relevant is this? In the early days of smart TVs, performance was a big concern. Now, with more mature ARM chip technology, performance is no longer a bottleneck. What’s more concerning is that some vendors are misrepresenting their chips, using low-end processors under the guise of high-performance hardware.
Take a 30-core processor based on the ARM Cortex-A72 architecture and Mali T820 GPU. While the specs sound impressive, in practice, it’s mainly used for running Android services and decoding video. The real value lies in image processing technologies like HDR and MEMC. However, most of these features are just integrated into a single chip, making all devices essentially the same under the hood.
Using a basic ARM chip to talk about image quality is like a smartphone claiming HIFI audio capabilities—just for show. True innovation comes from independent image engines, advanced algorithms, and strong databases—things that require significant investment and expertise. Very few companies have the capability to deliver such advancements.
Another common claim is the "big screen value." Internet TV promises to create new business opportunities through content, tourism, education, and gaming. But in a world where time is fragmented, competing with mobile devices, PCs, movie theaters, KTVs, and game consoles is tough. These so-called new models are not necessarily better than existing alternatives.
Moreover, recent panel price hikes have exposed the flaws in the "big screen value" narrative. The actual revenue generated from content operations, VIP subscriptions, and ads may not even match the increase in panel prices. With limited market share, it's hard to justify the business model of content-driven operations.
In summary, the TV industry is slow to change, and true innovation comes from technological breakthroughs, not just business model shifts. Technology drives progress, while business models merely optimize resource allocation. The bubble of Internet TV will eventually burst, and what’s left will be seen clearly by everyone.
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