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Even if live streaming has been around for many years, it experienced a tremendous acceleration during the pandemic as people spent on average 30% more time engaging with their smartphones and media devices.


As technology and media consumption remains higher than pre-covid levels, the success of Live Streaming is growing on a global scale. One of the sectors in which it has been more successful is e-commerce: E-commerce consumption accelerated by three years during the pandemic, and the increased competition in the virtual space worked as a catalyst, pushing companies to improve their users’ online experience and catch their attention.


Chinese tech giant Alibaba was the pioneer of Live Streaming in e-commerce. Through the Live Streaming platform Taobao, Alibaba created a new personalized shopping experience, connecting companies with roughly 800 million monthly users who visit Alibaba’s e-commerce site. Taobao’s range of products available in live streaming has been growing massively and the platform is expanding its offer to those categories previously available only offline, such as cars and large appliances.





Live streaming has also become a key feature in the social media landscape. With 2.6 billion downloads, 1.6 billion worldwide users (including Duoyin), and 800 million monthly active users, TikTok is one of the fastest-growing social media platforms ever. What makes TikTok unique is its AI algorithm. Once a video is uploaded on the platform, the AI algorithm uses Natural Language Processing (NLP) to analyze and categorize the video – including audio, hashtag, and images, which allows TikTok to provide users with highly targeted content that they find most interesting. In this way, TikTok’ content can engage its new users for up to 10 minutes, which is three times the capability of Instagram.




Another example is the Amazon-owned platform Twitch, which hosts 91% of all video game streaming and provides the content of more than 4 million broadcasters, monthly. In a high-competitive video games landscape, Twitch differs for the “Just Chatting” category: Streamers can engage with the community and talk to viewers even when they are not playing any game. To understand the impressive growth of the platform, consider that Twitch peaked at around 1.7 billion hours watched in November 2020, versus Facebook’s all-time-high of 250 million in September.





The live streaming market can become the largest entertainment medium. As reported by TechJury, the global live streaming market is surpassing the traditional media ecosystem - such as TV or social media- and it is expected to be worth over $247B by 2027. The growth trajectory is supported by a secular shift in consumer habits, considering that 63% of people aged 18-34 watch live streaming content regularly.


 

The information in this article should not be regarded as a description of services provided by Delian Partners SA. The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. It is only intended to provide education about the financial industry. The views reflected in this article are subject to change at any time without notice.

For a long time, China has been considered the “workhorse” of the global economy by providing low-cost manufacturing services to Western Companies. However, during the last decades, China has evolved from being a manufacturer to being a consumer of technology, and more recently to being an innovator and pioneer in some technology segments.


China’s technology industry has grown remarkably and today it is leading the pace of innovation in areas such as Artificial Intelligence and Social Media, to the point where it is followed and copied by Western peers.


For example, in e-commerce, Chinese Companies have developed social commerce and live streaming for years now, while Amazon only introduced live stream videos of hosts demonstrating products last year. Recent upgrades such as Instagram’s Checkout and Alphabet’s Youtube shopping services are all features that have been available to Chinese e-commerce users for years.


Chinese Companies, such as WeChat and Alipay, have also pioneered the “super-app”, a powerful multipurpose platform combining payment solutions, shopping, travel, games, and various services bookings. According to Bloomberg, in Q1 2020 the Monthly Active Users of WeChat increased by 8.2% to 1.2 billion, reaching over 300 million Daily Active Users. Facebook started enriching its mobile platform with features such as payments and games only one year ago, indicating a step in the same direction.


Some Chinese Technology Companies are also growing at an extraordinary pace. For example, Chinese e-commerce Company Pinduoduo was launched in 2015 as a small startup focusing on social online shopping. Today, it is the second largest e-commerce platform in China with an average of 487 million Monthly Active Users in 2020, an increase of 68% from 290 million in the same quarter of 2019.


These numbers not only show the potential for growth in the global technology sector, but also serve as a reminder of the speed of technological disruption, which is likely to affect all sectors of the economy. A study from Merrill Lynch predicts that 50% of S&P 500 Companies could be replaced over the next 10 years, and the average tenure of an S&P 500 Company could be reduced to 12 years by 2027 (from a high of 40 years in 1977). This scenario would be very supportive of an active stock picking strategy, highlighting the need for investors to remain selective and maintain a deep understanding of the global forces disrupting the investment landscape.



 


The information in this article should not be regarded as a description of services provided by Delian Partners SA. The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.  It is only intended to provide education about the financial industry. The views reflected in this article are subject to change at any time without notice.

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