OFweek smart home network News: LeTV has always insisted on "Blindfolding," but unfortunately Jia Yueting is not Musk, crazy money and did not win the recognition of investors and the stock price rise. Jia Yueting’s US expansion plan is experiencing the worst blow in history.
Full contraction of front
The vision that LeTV set off was considered to be the biggest acquisition plan in the history of the global television industry. On April 11th, LeTV and Vizio announced that the acquisition of Vizio's merger agreement will no longer continue due to the unfavorable regulatory constraints. The Vizio acquisition will lead to a slowdown in LeTV's entry into the U.S. market.
At the same time, LeTV will confirm the news that one-third of the staff will be laid off in the United States. A LeTV employee in San Jose, California, told the First Financial reporter: “All departments are laying off staff.†LeTV currently has 475 employees in the United States, and will conduct several rounds of layoffs in the next few months, eventually reducing the size of its employees to 300. about. In response to a previous employee’s unwillingness to report a loss of salary due to LeTV, LeTV responded that “Some difficulty encountered when remitting funds from China led to payday adjustments.â€
LeTV employees also revealed to the First Financial reporter: “Part of the projects that the company had to carry out in China in April were also stopped because of the lack of money.†It is understood that the Chinese project he mentioned is the Shanghai Auto Show to be held next week. LeTV has already Give up product display. Ni Kai, vice president of LeTV’s Autopilot, confirmed to the First Financial reporter that LeTV will not participate in the Shanghai Auto Show as an exhibitor. However, he said he was unaware of the specific products he planned to display at the auto show and did not confirm whether the cancellation of the exhibition was caused by a shortage of funds. "My department is only responsible for research and development." Ni Kai said.
At CES in January this year, just a few days after the release of Faraday's future FF91, the company’s official website displayed more than 60,000 orders. However, one month later, there was news that Faraday’s future official announced the suspension of production due to lack of funds. Faraday has repeatedly been billed for arrears of supplier fees in the future.
In response, Nick Sampson, Faraday’s Senior Vice President of R&D and Engineering, responded to the report, “Someone misunderstood the information. We have never had a financial crisis, and the factory's second phase of preparations has started.†However, there are recent reports citing California. City officials in Vallejo said: “The negotiation between Faraday Futures and Vallejo on the construction of a car factory on the site of the Naval Shipyard in Male’ Island has ended.†It is understood that the factory covers an area of ​​157 acres and is the United States Navy. The first naval base established on the West Coast in 1853, "Marley Island Naval Shipyard"
Last year, LeTV purchased 49 acres of land for $250 million from Yahoo in Santa Clara, Calif., when the company stated that it will be the future headquarters of LeEco, creating Le Eco Eco City, capable of accommodating 12,000 people. Employees. But now, this plan also has to be grounded. In March this year, foreign media reported that Lexus' EcoCity site is looking for sale and mentioned that it is negotiating with the Genzon Group and plans to sell for $260 million to raise funds.
US revenue is far less than the target
LeTV is facing serious financial problems in the past six months, which has caused Jia Yueting to be forced back to the front. The biggest problem now is not expansion but raising money. In October of last year, LeTV ran a big ecological chain release in San Francisco. Behind the glamorous conference, however, LeEco saw only US$15 million in revenue in the United States last year, which is different from the company’s expected target of US$100 million in revenue.
In July last year, LeTV announced the acquisition of Vizio, a US smart TV giant, in the United States in Los Angeles. The acquisition amounted to US$2 billion. It was considered by the industry to be the largest acquisition plan in the history of the global TV industry. For Vizio's takeover change, LeTV stated that it has “had promoted with great sincerity†because of strict supervision. LeTV’s new CEO Liang Jun said in an interview with the First Financial and other media yesterday: “There is no impact on the layout of LeTV in the US market, and Super TV still implements the US market expansion as planned.â€
Acquisition failed, LeTV stated that it has reached a new agreement with Vizio and will continue to look for opportunities to integrate LeTV's application and content into Vizio's Internet TV platform and establish a collaborative partnership to use LeStreet's EUI platform and the brand. Unique content and distribution channels bring Vizio products to the Chinese market.
However, the cooperation between LeTV and Vizio has not shown fundamental innovation. In the United States, LeTV’s content manufacturing capabilities will not be able to compete with Netflix, Amazon, and ESPN in the short-term, and LeTV will have to develop more ideas in this area in the United States in the future. In addition, building IP with global influence will also be one of the biggest challenges facing LeTV’s globalization.
LeTV’s active defeat also gave its competitors excellent opportunities for development. Zhang Yan, chief executive officer of optical film maker Jicai Technologies, told the First Financial reporter: “Letvision was originally an ideal partner for our optical quantum dot film, but because of the series of financial crises that occurred last year, Lexus’s cooperation was forced to be interrupted. Looked for the cooperation of micro-whale TV.†In recent days, Gay Science and Technology signed a strategic cooperation agreement with micro-whales to cooperate on quantum dot film products. Micro-whales will also work to increase the proportion of quantum dot film used in television manufacturing, and promote quantum dot TV. The popularity of it will gradually increase its penetration rate in the future.
In fact, the reason why LeTV's overseas development has been hindered is that it is because of too many funds in an unfamiliar market. Prior to LeTV, a number of executives including Ding Lei had left the company. Many of these executives lacked awareness of the US market and led to a detour in the strategic layout of LeTV.
This also reflects the general problems faced by China's emerging Internet companies in their overseas expansion. Denis Depoux, the president of consulting firm Roland Berger Asia Pacific, told the CBN reporter: “Most Chinese companies have adopted a strategy to copy their mature and successful business models in China overseas. This makes sense. However, we must also understand the differences in overseas markets, so overseas expansion cannot be rushed."
During the CES in January this year, Jia Yueting said that he was actively financing when he received an exclusive interview with the First Financial Journalist. Soon after, LeTV ushered in a strategic investor including Sunac China. However, the troubles of LeTV in overseas markets have not been completely eliminated.
On the evening of March 30th, LeTV announced that Jia Yueting had transferred 161 million shares of LeTV under a 35.39 yuan per share agreement, involving an amount of 6.051 billion yuan, accounting for 8.56% of the company's total share capital. On April 10th, LeTV released the first quarter 2017 earnings report. The net profit attributable to shareholders of listed companies was 103,260,400 to 131,950,200 yuan. Compared with the same period of last year, the change ranged from 10% to 15%. . LeTV attributed the slowdown in its performance to the negative impact of liquidity constraints from related parties.
Compared with LeTron's aggressive "Blindness", BAT's steady expansion of its overseas expansion strategy is preferable. They are more inclined to invest in American start-up companies, and they set up medium-sized US offices with the main purpose of acquiring talent. Taking Baidu as an example, Robin Li said that he will provide 25% more than the market salary to attract high-tech talent from around the world. To this end, Baidu will establish a number of overseas offices.
As a rival of LeTV, Baidu is also actively developing research and development of unmanned vehicles. Zhang Yaqin, the president of Baidu, told the First Financial reporter during the Boao Forum this year: “Baidu’s talents in the future will not only be limited to Asians and Chinese but will attract talents of all colors.â€
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