Chapter 629: Mutual Verification

Recently, Fang Hong has been pushing forward the acquisition of mainland cinema assets under Orange Sky Golden Harvest.

This matter naturally couldn't be kept secret from industry insiders, and word spread quickly.

Such a massive acquisition, with such a big stir, couldn't possibly go unnoticed; Fang Bin, the newly appointed CEO of Dadi Cinema, urgently inquired about the situation with Wu Kebo.

"How in just a short while did you sell the cinema chain to Chang'e? Weren't we agreed to wait?"

"They were straightforward and more sincere; you kept lowballing me, pushing the price down again and again—I naturally chose the one I like, the higher bidder," Wu Kebo said bluntly.

I talked with the Principal—he was direct, named a price and we closed the deal; but with Dadi and these people, they kept lowballing—3.4 billion wasn't enough, they wanted to push it lower.

This left Dadi helpless—they originally planned to acquire Orange Sky Golden Harvest's cinema chain to expand their influence into first- and second-tier cities, only to be outmaneuvered by the Principal.

Dadi built its business on lower-tier markets; although they have many cinemas, their market share is only 7.8%, far below Wanda's.

After all, the number of people watching movies in first- and second-tier cities is far greater than in towns and villages.

Wanda holds a 13.6% market share, 5% to 6% higher than Dadi;

China Film Cinema's market share is only 8.1%, also nowhere near Wanda's—both are behind Wanda Cinema.

But Wanda benefits from its plazas—the foot traffic is simply higher, and cinemas still rely on foot traffic.

This is why Fang Hong wants a cinema chain—to not be dependent on others; cinemas are the final link in the entire film process, from production to distribution to screening.

With cinemas, Chang'e has completed its full industrial chain layout; Chang'e Technology can provide technical support as a promotional aid.

Lao Wang Zong, seeing the Principal swallow Orange Sky Golden Harvest's cinemas and also take a stake in Anle's cinemas, grew restless.

He immediately called the CEO of Shimao Circuit: "The deal you mentioned—packaging the office buildings together—is negotiable."

Acquiring Shimao Circuit means acquiring their office building properties too, which aren't performing well.

So neither Wanda nor Fang Hong reached an agreement—he doesn't do real estate; what use are office buildings to him?

He's not rich enough to buy up broken buildings.

The matter remains stalled; Shimao also wants to hedge its bets, waiting to see who offers better terms and more money.

Of course, Fang Hong isn't just targeting Shimao—he's also eyeing other cinema chains and is building cinemas himself, including Bona also building its own.

He's also spending 500 million to fully renovate his cinemas and upgrade all equipment to laser projection, creating digital cinemas.

All Orange Sky Golden Harvest cinemas will be rebranded as Crystal United Cinema; during this process, Tu Piao Piao also participated, helping deploy intelligent systems.

The summer season peak has just passed, leaving about a month to do this—next is the National Day holiday slot.

Of course, upgrades will be done in batches; too many at once might overwhelm us and cause us to miss good slots, and the second half of the year is naturally a box office peak.

There are only a few slots each year that actually make money.

Spending 2.2 billion at once is still within Chang'e's current capacity—the year has seen strong returns from many blockbusters, films, and Variety shows.

Just take "The Monkey King: Hero Is Back"—it earned 1.36 billion; even without counting Tu Piao Piao's distribution, Tian Xiaopeng received 5% of the total box office, earning 68 million.

One film brought him financial freedom—but that's his talent.

Very few people truly make good animated films; besides him, only Jiaozi came later—he's rare.

Chang'e Animation relies on Fang Hong's oversight and team collaboration, which still differs from genuine, authentic creation.

Of course, he pays his own taxes—whether through the company or personally, it's up to him.

Chang'e's box office return is roughly 360 million; after deducting all production costs of about 300 million, the film's actual cost was 60 million, not counting copyright fees.

The copyright given to Chang'e Technology can generate another revenue stream—new films attract many viewers initially, plus there are many other distribution channels.

For example, CCTV Movie Channel, local Satellite TV, other Satellite TV networks, and international streaming in Hong Kong, Southeast Asia, plus various merchandise.

Although merchandise has many pirated copies, some still license genuine versions—though not many, around a few million.

Adding up all the miscellaneous income, a conservative estimate is 400 million in profit.

So 2.3 billion poses no pressure on Chang'e now—its previous film "Gravity" earned over a billion.

Moreover, Chang'e Technology still owes Chang'e a lot of money, because Chang'e is a content provider; after licensing copyrights to Chang'e Video or Bilibili, many payments remain unpaid.

Bilibili also needs copyright licenses—even if others haven't paid, they still must pay Chang'e, since they're competitors.

This is necessary for future copyright standardization—it's an unavoidable path; any legitimate platform must follow copyright norms, but Fang Hong can't enforce this yet.

Because Bilibili needs to grow, Douyin needs to grow—both rely on clips; enforcing copyright now would invisibly raise costs dramatically.

Of course, with the rise of the three major platforms and major film studios, a copyright war is inevitable.

No one wants Chang'e to take their film copyrights and make clips that leave no one watching the full movie—everyone just watches the summaries.

Recently, Dragon TV sued Bilibili for infringing "The Voice of China," claiming unauthorized second creations of their content—it's become a landmark case, watched by all.

Chang'e differs from Chang'e; as a content distributor, it must endure this.

In content, no one has ever cared about face—they all copy each other's quality content; who could have grown without copying in the early days?

Baidu's crawlers didn't just crawl everywhere? But later everyone built information cocoons and blocked them, so Baidu became weaker and its content more garbage.

Later, Tencent copied Douyin's content, and Douyin copied Tencent's music—thousands of lawsuits have been filed over copyright, turning them into bitter enemies.

Not just Douyin—Alibaba and NetEase have also clashed fiercely with Tencent over music copyright.

Because Tencent controls 95% of the industry's music copyrights, this massive library effectively monopolizes the music market.

Eventually, regulators couldn't stand it and ordered Alibaba, NetEase, and Tencent to mutually license 99% of their music libraries to each other.

This should have been a copyright knockout blow against Tencent!

But the real core music is only 1%—meaning 99% of the music is barely listened to, while only that 1% is popular.

Think of how many songs exist—even just Mandarin music, a conservative estimate is over a million—so 1% is still 10,000 songs.

How many people have actually listened to 10,000 songs? Everyone just keeps listening to the same few good ones.

This doesn't even count overseas music—exact numbers are uncountable—and Tencent holds 95% of it, utterly terrifying.

Now Tencent is doing exactly this—filing complaints everywhere against competitors' music infringement, submitting administrative complaints to authorities and teaming up with international record labels to defend rights.

They don't sue—they file complaints, just to get authorities to take notice and establish copyright norms.

Of course, Chang'e has also been complained about!

It's just that Fang Hong has no money; if he did, he'd buy up film, music, everything, and play the game the way Tencent does.

But he still has a lot to do — to do one thing, he has to give up another; you have to let something go. Playing the copyright game takes strength; without it, no one gives you the time of day.

Tencent has that strength — only after securing the licensing rights did it play the game openly and above-board.

Recently, All People Super God has been dying off step by step; with Honor of Kings no longer having a competitor, its daily revenue is very impressive, enough to sustain operations and more.

He's preparing to restart the Data Center construction plan. Previously there were already 11,000 server units; Fang Hong plans to invest five billion to build another 50,000 server units, striding forward in great strides.

This year, Chang'e Technology was always meant to develop aggressively — borrow money if you have to, but develop.

With this, there will be 61,000 server units in total, and the theoretical concurrent data capacity will increase to 300 million, which will greatly ease the data pressure.

One server unit includes computing, storage, networking, monitoring modules, security modules, power and cooling, plus software — it's a very complex thing.

Previously they had always been renting external servers; that's not safe — having their own is better.

At the very least, the stored user data is in their own hands.

And having their own will let the technology side develop faster, and can also pave the way for the later Douyin.

Douyin's user growth rate is very fast right now — after all, it's been promoted continuously these past six months — but a lot of people are saying this software is a copy.

For instance, the South China Morning Post reported: "Tech analysts criticize Douyin for imitation, especially in its youth-user operations and music content ecosystem."

Including Weibo, overseas Twitter users have also said the two apps look alike.

There's no way to rebut this — there really was borrowing of ideas.

Over at Chang'e Technology, Gao Zhun saw Fang Hong's construction plan and couldn't help asking: "General Manager Fang, isn't investing five billion at once a bit much?"

"It's not a one-time payment," Fang Hong said.

Building a Data Center takes time, so the process will definitely be in phases.

"No, I'm afraid Honor of Kings' revenue might have an accident — recently this game's revenue has slowed and is leveling off." Gao Zhun meant it was a bit risky.

Originally this year was aggressive development, money flowing out like water.

And Honor of Kings' Skin sales only exploded for about a month or so — that was when they ran a promotion, but once the promotion ended, sales dropped back down.

Those who were going to buy already bought; those who weren't won't buy either.

MOBA games aren't like MMOs — most Skins are one-time purchases; at most one or two thousand yuan gets you the whole set. There aren't that many Skins yet, so it doesn't need that much money; whales have money but nowhere to spend it.

Unlike MMOs, where one person might as well top up 100 million, and there's still no cap.

"It's fine, just invest as needed — I know what I'm doing!" Fang Hong said.

The Hero Glory Finals are coming soon, and this game's popularity will reach another level.

Also, PlayerUnknown's Battlegrounds has been in development for over half a year now — the core gameplay mechanics, the maps, and the multiplayer online play are all pretty much done.

In another month or two, testing will begin.

Actually, Bluehole didn't finish this game in four months — that's a rumor. From development to testing and performance optimization, it took over a year.

Of course, Chang'e's technical strength is definitely stronger than Bluehole's, and there aren't many places that need verification.

If there are problems, Fang Hong just tells them to fix it — just develop according to the gameplay and impressions in his memory, copy and reproduce.

Movies aren't easy to reproduce, but games are very easy to reproduce — game gameplay is all about copying.

MMOs copied Warcraft for all those years; competitive games copied 3C for all those years.

Domestic manufacturers can't copy well because they want to make money fast — they have no patience.

He knows the future, so he's not flustered at all — what worries him is only the outside competition: Tencent, NetEase, these companies.

He's afraid some sudden hit will come out and squeeze him to death.

Fang Hong asked: "The Moonton Technology acquisition I told you to handle — any progress?"

"It's already been negotiated. One hundred million will do it. That company is short on cash right now — they've only developed one card game and nothing else." Gao Zhun had been following this matter; it wasn't difficult.

The current Moonton is just a small company compared to Jade Rabbit.

"Good, acquire it as soon as possible." Fang Hong nodded.

With this company, Chang'e will basically have occupied the MOBA market in every field, domestic and overseas.

They can also cross-verify, copy each other, and countersue Tencent for infringement — Tencent will definitely still make MOBA games.

(End of chapter)