iQIYI's Strategic Pivot: Short-Form Content and Technological Innovation Fuel Growth

iQIYI, China's leading online entertainment platform, has showcased its strategic response to the evolving TV drama industry trends, focusing on short-form content and technological innovation to drive growth. The company's keynote speeches at the first China TV Drama Production Industry Conference and the 10th China International TV Drama Program Trade Fair in Shenzhen highlighted its commitment to a viewer-centric approach, respecting the creative process, valuing content creators, and leveraging innovation to deliver premium content.

iQIYI's strategic initiatives in short-form content include the "Thousand Mini-Dramas Initiative" and "Hundred Short-Dramas Initiative," which cater to the growing market demand for concise storytelling. The "Mini-Drama Theater" focuses on mobile-optimized vertical content of 1-3 minutes per episode, covering genres from romance to suspense, while the "Short-Drama Theater" features horizontal format content of 5-20 minutes per episode, emphasizing premium period dramas and urban storylines. By offering both vertical and horizontal formats, iQIYI caters to diverse user preferences across different scenarios, attracting new users and enhancing user satisfaction and loyalty.

iQIYI's expertise in long-form video content production has enabled it to achieve breakthroughs in the short-form content segment. Its mini-drama portfolio has surpassed 10,000 titles, capturing 95% of the leading mini-drama content providers in the market. In December 2024, the platform's first mini-drama generated over RMB 1 million (US$0.14 million) in revenue-sharing income, validating the monetization potential of this content format.

iQIYI has also revamped its apps to improve users' viewing experience. While the main app continues to focus on long-form video with membership-based revenue models, the iQIYI Lite app has been strategically repositioned to primarily feature free mini-dramas supported by advertising. Recent data indicates the growing popularity of mini-dramas, with viewing time on the main app now rivaling that of animation, kids' content, and variety shows. On iQIYI Lite app, mini-dramas have secured the second position in viewership, surpassed only by traditional long-form dramas.

iQIYI's cutting-edge advancements in virtual production technology have been actively implemented across its robust portfolio of long-form dramas, where the company has secured the highest viewership market share in both Q4 and throughout the full year of 2024. For example, the original drama "My Journey to You" achieved a remarkable 30% increase in production efficiency through virtual filming techniques, while "Fangs of Fortune" pioneered large-scale water surface reflection in virtual filming in China. With virtual production elements comprising 16% of its total production, "Fangs of Fortune" stands as one of the most technically sophisticated and extensive virtual productions in China to date.

To stay at the forefront, iQIYI has made substantial infrastructure investments, including the recent completion of a 2,500-square-meter flagship virtual studio that meets world-class standards of excellence. Additionally, its self-developed IQ Stage virtual production platform integrates over 20 patented technologies, enabling sophisticated real-and-virtual integration effects that deliver exceptional visual experiences to global audiences.

iQIYI's strategic focus on short-form content and technological innovation has contributed to its overall growth and market share in the TV drama industry. By catering to diverse user preferences and monetization models through app segmentation, the company has maximized revenue opportunities and driven growth in the competitive streaming landscape. As the content and entertainment industry continues to transform, iQIYI's strategic initiatives position it to capitalize on evolving viewer preferences and market trends, ultimately solidifying its market position in the competitive streaming market.