From niche to mainstream: Bilibili's dilemma in monetizing its video platform

When top influencers left Bilibili, it seems that the video platform must choose a way in the road of video content.

Recently, Chinese video-sharing platform Bilibili has been at the epicenter of controversy. The platform’s content creators, who are the backbones of its user-generated content (UGC), have been going on hiatus and turning against it.

If you're not familiar with Bilibili, it's a popular Chinese video-sharing platform that's often compared to YouTube. However, there are some key differences between the two. Unlike YouTube's open ecosystem and algorithmic recommendations, Bilibili takes a more curated approach to content discovery. When users visit Bilibili’s homepage, they are greeted with a banner of content categories, which currently number 28. This is in contrast to YouTube's main page, which is more free-form and random, with tags generated based on users' preferences and only seven roughly categorized video genres on the left-hand column.

YouTube positions itself as a platform that caters to all kinds of video content, while Bilibili initially started out as a platform dedicated to ACG (anime, cartoon, and gaming) content. However, Bilibili quickly gained a loyal following and expanded beyond its niche roots following its launch in 2009. During its early years, content creators and viewers were less preoccupied with monetization and the formalities of video length or style. Instead, Bilibili placed more emphasis on building a sense of community around shared interests, which helped solidify its status as a cult favorite among users.

However, as the platform has expanded and attracted more attention, monetization has become a more pressing concern for Bilibili. As a result, the platform has had to strike a balance between the needs of its users and content creators and the demands of advertisers and investors. While Bilibili’s roots are in the loyal yet niche ACG community, the platform’s ambitions have grown beyond this audience. In an effort to appeal to a broader range of users and creators, Bilibili has been working to diversify its content offerings.

“Good content must give users a sense of gain. Users love platforms that can help them grow, and platforms will also grow together with users by providing valuable content.”

On March 30th, three days before Bilibili’s creator's protest trended on Weibo, Chen Rui, the founder of Bilibili, delivered a speech at the 10th China Internet Audio-Visual Conference. Chen discussed Bilibili's achievements in technology-related video content. According to Chen, 200 million users watched technology-related videos on Bilibili in the past year.

Mo creators mo problems

Bilibili has put in significant effort to bring more variety into its ecosystem. These efforts include offering cash incentives, boosting traffic, and talent scouting. The platform has been aggressively courting creators who have already found success on other platforms, such as Douyin, the Chinese version of TikTok.

But to creators who have been with Bilibili from the start, it feels like a brutal betrayal. “Aluren” (@A路人), a gaming content creator, voiced his discontent on Weibo and accused Bilibili of “neglecting the old content creators because Bilibili believes that they grow together with the platform, and they don't have to be recognized since they don't manage other platforms.” According to the creator, conversely, the video makers who come from Douyin, Kuaishou, and Xigua are treated as prized assets of the company and are entitled to more advertisements, resources, and promotion opportunities.

It seems like Bilibili is having a hard time balancing its original creators and new talent, but this brings another question: why does the platform assume the role of a parent in the first place? Why does Bilibilli choose to “parent” and closely manage its content ecosystem rather than letting it grow organically?

As one of the early birds in the content platform scene but a latecomer to commercialization, Bilibili is trying to hasten the progress by taking action, but it seems to be exacerbating the situation. Despite repeatedly denying large-scale layoffs, the company was still exposed to job cuts in February, April, May, and December 2022, affecting positions in research and development, operations, and human resources, among other areas. At the end of 2022, Bilibili had 11,092 employees, a decrease of 1,289 compared to the end of 2021.

Along with the layoffs, Bilibili's business lines are also shrinking. Over the past year, at least 10 of Bilibili's game projects have been cut, including its "Light Video App" and several internal game studios, such as "Zhaijidi” (宅基地), "Chuansongmen" (传送门), and "Guiji" (轨迹), have also been shut down.

Since Bilibili’s first public financial report, it has reported losses for eight consecutive years. While the platform is sitting on a gold mine of engaged users, it has struggled to monetize its other businesses. As a result, the temptation to cash in on its devoted community has become increasingly difficult to resist. In early 2022, Chen Rui stated that the company’s strategic focus would be on accelerating its commercialization process, while still prioritizing user growth.

Cashing in on content economy is no piece of cake

The landscape of content creators has evolved too. The once-prevailing “starving artist” mindset among Bilibili creators has given way to a new breed of creators. The first generation of Bilibili creators embodied the popular adage, “用爱发电” (using love as fuel). In its infant phase, Bilibili was simply a platform for game tutorials, pirated Japanese anime, and gachi clips (a type of video that blends audio and video clips to create absurd humor).

Creators weren’t trying to make a living off these videos, and neither did viewers expect professional and paid quality of content. But as the content economy and attention economy have swept the internet by storm, monetization has become something that can’t be overlooked.

Li Ziqi, China’s most influential vlogger with 17.4 million subscribers on YouTube, disappeared from the public eye less than two years ago, but her channel - which has been on hiatus since July 2021 - continues to generate impressive monthly advertising revenue of 785,000 RMB, a figure that easily outclasses most content creators. Li Ziqi and other successful creators have set a high bar, inspiring other creators to elevate the quality of their content and expect appropriate compensation in return. As a result, the “using love as fuel” mentality has given way to a growing belief that quality content deserves recognition and financial rewards.

As mentioned before, Bilibili’s efforts to commercialize include cash incentives and traffic promotion in addition to talent scouting. The decreasing incentives also largely triggered the creators’ protest.

According to a movie content creator on Bilibili, since the platform adjusted its internal incentive mechanism last year, the income of content creators has suffered a significant decline. The creator revealed that the total income after the incentive adjustment has plunged by over 30% in comparison to the earnings before the changes were made.

Bilibili’s official statistics seem to support the change: according to the platform, 1.3 million content creators received incentives from the platform last year, which means each account can earn around 800 yuan per year on average.

The discontent among Bilibili’s first-generation content creators is palpable. Feeling mistreated and undervalued, they are increasingly frustrated with earning less despite their belief that their work deserves more recognition. In contrast to other popular short video platforms like Douyin and Kuaishou, Bilibili has distinguished itself as a unique community for longer-form content, with videos that often span between  10-20 minutes in length. However, in its quest to broaden its user base, Bilibili has begun to promote short videos heavily since 2020, creating a disconnect between the quality of the content and the financial rewards offered. This has led many creators to question the absurdity of a carefully orchestrated long video losing out to a mere few seconds of content.

Bilibili is grasping at straws with its pivot to short video and other features. However, one new feature launched on April 12th, which generated AI avatars of the users, caused outrage when it was discovered that it was publishing users’ real-life selfies without their consent. The campaign, which was in collaboration with miHoYo’s mobile game Genshin Impact, was launched at the peak of the AI hype in China. While it’s unclear who is responsible for the farce, the incident may once again speak to Bilibili’s hastiness and lack of attention to detail, which can only lead to further problems.

Writer: Zijing Fu

Editor: Boyuan Wang