Entertainment mogul: Starting his business with the internet

Chapter 542 Internal Disagreements
The afternoon sun was incredibly hot in late June.

Wang Jing pushed open the door to the conference room at Tengda headquarters and saw the following scene:
The management teams of Toutiao Video and Tiangong Special Effects, two subsidiaries, sat on opposite sides of a long table, clearly separated, like two opposing negotiating parties.

Upon seeing the COO enter, the previously noisy hushed discussions abruptly ceased.

"Mr. Wang." "Hello, Mr. Wang."

Amidst the rising and falling greetings, Wang Jing remained calm, nodded slightly, and walked straight to the head seat to sit down.

Without exchanging any pleasantries, she surveyed the room and finally looked at the two leaders sitting on either side of her, getting straight to the point: "Everyone's here, so let's begin."

The purpose of today's joint meeting is very clear: to encourage Toutiao Video and Tiangong Special Effects to work together in the animation field.

A clear and calm voice echoed in the meeting room: "Whatever disagreements we have, let's put them all out on the table and discuss them clearly today. What the group needs is not superficial harmony, but to avoid internal friction and form a united force."

Hou Shen and Zhou Juan, who were called out, subconsciously exchanged a glance, both seeing a hint of embarrassment in each other's eyes.

The fact that the matter escalated to the point where the COO needed to mediate made both of these proud and arrogant regional officials lose face.

“President Zhou!” Wang Jing called out first. “President Hou works in the Modern Building and doesn’t come to headquarters often, so this is your home turf, so you can start first.”

“Okay, Mr. Wang.” Zhou Juan cleared her throat and began to report: “Mr. Wang, colleagues, Toutiao Video and Tiangong Special Effects share a unified vision.”

That is to jointly build the Tengda Animation Universe and establish a complete closed loop from creative incubation to IP monetization.

"In terms of division of labor and positioning, Toutiao Video is the IP operator and the main traffic hub, responsible for front-end IP mining, user operation, market promotion and commercial monetization."

Tiangong Special Effects acts as both an IP forger and a technology engine, focusing on transforming high-quality IPs into top-notch audiovisual products and overcoming technical challenges.

Wang Jing listened attentively, occasionally jotting down a note or two in her notebook. She commented, "The strategic plan sounds good. So, what problems have you encountered in its implementation?"

Hou Shen immediately picked up the conversation, his voice becoming more urgent: "President Wang, President Zhou hopes to establish an internal settlement mechanism."

We hope that Tiangong Special Effects will adopt a cost-plus-priority model for the Toutiao video production project.

Upon hearing this, a barely perceptible smile flickered across Wang Jing's face, her tone calm:
"From the perspective of the group's ecosystem development, it is normal for IPs to circulate internally, and for them to receive certain resource allocation and price discounts."

This allows Toutiao to obtain top-tier special effects support at a lower cost, while Tiangong can also hone its technology and train its team through these projects—a win-win situation.

"That's not all, Mr. Wang!" Hou Shen quickly added, speaking even faster.

"General Manager Zhou also suggested that for some key projects, he hoped that Tiangong would not charge or would charge less for production, and instead exchange production for a share of the later profits!"

Upon hearing this, several senior executives at Tiangong Special Effects frowned, clearly expressing their dissatisfaction.

"President Hou, please calm down." Zhou Juan interjected at the right time, trying to ease the tense atmosphere. "My proposed production cost equity investment model is essentially a deep cooperative exploration of sharing risks and benefits."

It's not about taking advantage of other departments, but about forging a stronger bond between our interests and motivating everyone to give their all to make the project a success.

Zhou Juan felt truly helpless. It wasn't that she was greedy for the production fee; it was simply that film and television copyright fees were skyrocketing, and Toutiao Video, as a long-form video platform, was under constant financial pressure.

Thanks to the previous assistance from the group, which helped secure the NBA rights, the strong performance of the sports sector has been providing financial support to the entire platform.

Against this backdrop, Toutiao Video naturally tries to save money wherever possible in its operations, trying to stretch every penny.

Wang Jing was perfectly clear-headed. She understood that while the two companies had a symbiotic relationship in terms of top-level strategy, they disagreed on the specific distribution of benefits and the pace of implementation.

Ultimately, the root cause lies in the different performance evaluation KPIs applied to them by the group.

Tiangong Special Effects, backed by Tengda's strong game business and film and television production, never lacks orders and enjoys high and stable profits.

The group evaluates it based on its technical skills and the quality of its work. It has neither the need nor the motivation to take on excessive risks for an external project.

Toutiao Video is currently in a highly competitive streaming market, surrounded by strong rivals such as LeTV, Youku, and iQiyi. The group assesses it based on membership growth, user dwell time, and profitability.

It must efficiently launch content and desperately acquire users in order to maintain its leading position in the fierce competition.

Wang Jing felt a headache coming on; being a referee was really tough. Her fingertips unconsciously tapped lightly on the smooth tabletop. "Any other questions?"

Zhou Juan sighed softly: "President Wang, what we just discussed were only differences in general direction."

Later, I discussed it with Mr. Hou and we felt that empty talk was useless, so we should try a specific project first.

So we partnered with the Reading Group to adapt the top-tier IP "Battle Through the Heavens" into an anime series.

"I know the novel 'Battle Through the Heavens.' And then?" Wang Jing agreed.

Hou Shen took over the report: "Based on joint calculations by the three parties, including copyright fees, the production budget for the first quarter is set at 3000 million yuan."

The specific investment plan is as follows: Reading Group, as the IP provider, will contribute the animation adaptation rights of "Battle Through the Heavens" as equity and pay an additional 100 million yuan, accounting for 20% of the total investment.

Toutiao Video, as the platform provider and main producer, contributed 50%, or 1500 million yuan in cash.

As the production company, Tiangong Special Effects, in order to demonstrate its sincerity and determination to share the risks, agreed to take the remaining 30% share through a combination of cash and a portion of the technical production fees.

Future profits will also be distributed according to this investment ratio.

Wang Jing nodded; in her view, the framework of the plan was clear:

"As the main investor and broadcasting platform, Toutiao Video bears the main financial risks and enjoys the largest share of the profits, which is reasonable."

"Mr. Wang, the problem isn't just about money!" Hou Shen's voice rose unconsciously. "The more crucial issue is the production philosophy! Toutiao simply doesn't understand animation creation!"

He complained bitterly: "The most crucial part of animation is the special effects, especially the fighting techniques and strange flames in 'Battle Through the Heavens,' which should be presented with the best technology! This is the core of the work!"

Zhou Juan immediately retorted, her tone hardening: "President Hou! You need to consider the actual cost pressures!"

Imagine how much money a single top-tier special effects shot like the 'Buddha's Wrathful Lotus' would cost! Hundreds of thousands! Even millions! If everything were done to movie-quality standards, the budget would completely spiral out of control!
"You have to be selective in your work. Using simplified effects in non-core scenes is the only way to ensure the project catches the summer movie season!"

"And the narrative pacing!" A vice president from Tiangong Special Effects couldn't help but speak up, "The emotional build-up and growth arc of the characters in the original work need to be shown in full length."

This is the foundation for a believable character. We suggest dedicating at least one episode to laying the groundwork for Xiao Yan's initial repression and...

"No! Absolutely not!" The head of content operations at Toutiao Video immediately interrupted, "The platform's big data predicts that if users don't see the famous 'breakup' scene of 'thirty years east of the river, thirty years west of the river' in the first ten minutes..."

The abandonment rate will skyrocket by over 30%! We must ignite discussion and emotion from the very first episode! The platform needs to be responsible for user data and retention rates!

The two sides went back and forth, with the focus of the dispute shifting from cost control to creative control, and from narrative pacing to marketing strategies.

The atmosphere in the meeting room was no longer peaceful; it became tense, as if an invisible gunpowder was emanating from the air.

Wang Jing observed calmly, already understanding the situation. The essence of the conflict was a struggle between a creator-centric approach and a data-driven approach.

Because Tiangong Special Effects has long served the game business with extremely high quality requirements, it has developed a habit of striving for excellence in projects, and even a bit of "technical fastidiousness".

In the fierce competition for traffic, Toutiao Video has long been accustomed to giving way to algorithms and user behavior data.

As everyone was deep in thought, weighing how to make a decision that would both address the needs of both parties and maintain the group's strategic focus, there was a loud knock on the conference room door. Turning to look, they saw Secretary Wang Jing enter, her face showing a mixture of apology and urgency.

"Mr. Wang, I'm sorry to interrupt the meeting. Chairman Song is back and wants to see you. He sent you a message, but you may not have seen it."

"Chairman Song is back?" Wang Jing stood up in surprise, subconsciously taking out her phone, which was on silent, and sure enough, she saw several unread messages.

He immediately instructed the attendees: "The meeting is temporarily adjourned. Everyone should take a break and calm down."

After saying that, he quickly left the conference room and took the elevator directly to the top floor.

The chairman's office door was wide open, and Song Ci was hunched over his desk reviewing a mountain of documents.

He looked slightly travel-worn, with a hint of weariness from his long journey, but his eyes remained bright and focused.

Jiang Tiantian and Jian Ning quietly assisted in processing the documents, efficiently sorting and delivering them to maximize efficiency.

Wang Jing knocked twice on the open door and walked in carrying a document. "Chairman Song, when did you arrive at the company?"

Upon hearing this, Song Ci looked up, put down her pen, and smiled gently: "We've been here for a while."

His trip was extremely tight. He first accompanied high-level officials on a visit to the United States, and after returning to China, he went directly south to visit leaders of three provinces and seven cities.

Following that, they discussed 4G strategic cooperation with Huawei and China Mobile.

Originally, I planned to meet with Wang Wei of SF Express, but due to scheduling conflicts, I was unable to do so. Instead, I flew directly to Donghai to inspect the three major research centers.

It has been more than two weeks since I left Beijing on the 8th of this month until today, the 24th.

While secretly observing the chairman's slightly tired yet still energetic appearance, Wang Jing handed him the documents in her hand.
He sincerely said, "You must have had a hard time going to the United States this time. Here is the approval document you requested."

Song Ci lowered his eyes and looked at the official document in his hand, which was stamped with a bright red seal. His expression instantly became serious.

The document's title is prominently displayed: "Approval for Tenda Technology Group to Establish MYbank."

This is the official approval document jointly issued by the People's Bank of China and the China Banking Regulatory Commission, authorizing Tengda Technology to establish the first private internet bank in China.

After carefully reviewing the key clauses and gently running his fingertips across the paper, he sighed after a long while, "It took nearly three months of repeated communication and revisions to finally get approval. It wasn't easy."

With this license, the group's strategy of developing internet finance can finally be considered to have embarked on a smooth path.

"Just leave the document with me, I'll hand it over to Lin Haifeng in a few days."

Wang Jing nodded in agreement: "Okay. Chairman Song, if there's nothing else urgent, I'll go downstairs to continue the meeting."

Song Ci casually asked, "What meeting?"

"It's about some conflicts between Toutiao Video and Tiangong Special Effects regarding their collaboration on animation..."

Wang Jing then succinctly reported to Song Ci the points of contention between the two sides at the joint meeting, their respective positions, and the differences in the "Battle Through the Heavens" project.

Finally, taking the opportunity, he asked, "Chairman Song, what do you think is the best way to coordinate this situation?"

After listening to Song Ci, he leaned back in his chair, his face showing no anger.
"As a group grows larger, internal competition and disputes are normal. This is a better indicator of an organization's vitality than a harmonious but stagnant atmosphere."

"The choice faced by Toutiao Video and Tiangong Special Effects is essentially a divergence between long-term IP value cultivation and short-term traffic acquisition."

Toutiao aims for viral content that quickly generates massive volume and drives data; Tiangong, on the other hand, seeks to slowly accumulate value and become a classic brand. Neither approach is inherently right or wrong.

After a moment's thought, a clear direction was given:

"From the perspective of the group's long-term strategy of building a large entertainment ecosystem, I personally tend to support Tiangong Special Effects' commitment to quality more."

However, we must also face the enormous pressure that Toutiao Video faces in its actual operations, and avoid talking about ideals in a way that is detached from reality.

“Take the pilot project ‘Battle Through the Heavens’ as an example.” Song Ci changed the subject, “Since Hou Shen insists that high-quality special effects are necessary, then we can introduce an internal performance-based incentive mechanism.”

If he insists on increasing the budget for the top-tier special effects of 'Buddha's Wrathful Lotus,' then let him sign a pledge and prove with data that his insistence is effective.

For example, after the special effects scene is launched, will it be able to generate a certain number of spontaneous discussions on social media?

Can it bring a substantial number of new members to the platform who are clearly attracted by the special effects?

If the target is achieved, the excess costs will be partially subsidized by the group through strategic investment, or the profit sharing will be adjusted.

If the target is not met, the corresponding amount will be deducted from Tiangong's future profit sharing or project bonus.

"At the same time, the evaluation of Toutiao Video should not be based solely on traffic," Song Ci added. "Long-term indicators such as user satisfaction and IP influence should be appropriately included in their KPIs."

The group should use its leadership to guide both sides towards aligning their goals as much as possible, thereby reducing conflict at its root.

Wang Jing suddenly understood and her mind cleared up: "I get it. We should use mechanisms to guide instead of administrative orders, and let them take responsibility for their own choices."

“I have another idea, and I’d like to take this opportunity to discuss it with you.” Wang Jing then proposed her idea: “I would like the group to take the lead and have Toutiao and Tiangong jointly invest in the establishment of a Tengda Animation Venture Capital Fund.”

This fund is specifically used to invest in promising animation studios, comic book platforms, and independent creative talents, both domestically and internationally.

"In terms of specific division of labor, Toutiao Video can leverage its platform data and user insights to be responsible for project screening and post-investment commercialization guidance."
Tiangong Special Effects leverages its technological advantages to provide these invested teams with professional technical support and comprehensive production process management, transforming these creative ideas into mature products.

Song Ci's eyes revealed approval: "This is a very good idea! It transforms internal competition into a partnership for jointly expanding external territories."

In short, you need to tell Hou Shen and Zhou Juan to broaden their perspective.

Tenda Ecosystem's advantage has never been in internal competition, but rather in enabling its various subsidiaries to work together to conquer the entire external market.

“I understand. I will pass on your instructions and implement them effectively.” Wang Jing’s confidence increased.

Just as she was about to leave, Song Ci added, "By the way, the group's semi-annual meeting next month is very important; it's expected to last about a week."

This time, we won't hold the meeting at the company. Instead, we'll find a resort hotel in a nice area so everyone can relax a bit during the meeting.

"Okay. When should we set a specific time?"

"We'll have to wait until Chen An's financial report for the first half of 2013 comes out before we can make a final decision. We've tentatively set it for around July 15th."

"No problem, I'll give the instructions."

Song Ci's eyes were deep, and his voice became more serious: "The next three years are crucial for Tengda."

Before the mid-year meeting, I will meet with each of the group's business departments to reach a consensus and clarify the path forward.

Then, in the strategic planning for the second half of the year, we need to see their clear, long-term blueprint. You and Mr. Zhang should try to make time to participate throughout the entire process.

"Understood!" Wang Jing nodded solemnly.

(End of this chapter)