Despite the current turmoil in the cryptocurrency world, Andy Tian, co-founder and chief executive officer of Asia Innovations Group, believes that the underlying blockchain technology has real world benefits and its success rests on extending its reach beyond the crypto community to the end consumers.
“I really believe that underneath all the craziness. The blockchain technology has real world benefits,” exclaimed Andy Tian, whose company Asia Innovations Group (AIG) created one of the world’s leading live mobile streaming platform, “Uplive”.
Uplive boasts more than 25 million users who have generated over $100 million in revenue in 2017 through 60,000 monthly broadcasters. The live streaming sector in China, which constitutes one of Uplive main markets is worth an estimated $5 billion. Uplive is also popular in other North Asian markets such as Hong Kong, South Korea and Taiwan which have been growing aggressively.
Tian attributes its success to operating a different revenue model as compared to traditional media companies. A model, which it borrowed from the game industry.
Traditional media industry, including social media companies, generates the majority of revenue from advertising but not the game industry.
“The game industry generates revenue not by advertising but from creating content-based virtual assets which players can buy and use in the games,” he elaborated.
He added: “Now we marry that revenue model with live streaming. So, when you watch a broadcast or live streaming, you can send the broadcaster virtual gifts in the shape of a virtual lipstick, virtual cars, virtual unicorn, virtual dogs, cats, kittens, etc.”
“They (broadcasters) almost get zero revenue from advertising on YouTube, Facebook or Instagram. Virtual gifts allow fans to contribute to them directly. It is not an advertising-based revenue model, it is a user-based model. Creating assets that users can buy to support the games (broadcasters) that they like.”
“That’s the power of virtual assets. Virtual gifts allow them to have real meaning. We have 60,000 broadcasters on our platform,” he emphasised
However, AIG has come up against a limit to its ability to meet the growing demand on its Uplive platform for virtual gifts and has launched a universal protocol for virtual gifts called “Gifto” to fill the gap.
Tian clarified that Gifto is based on the ethereum blockchain and offers a self-governing and self-sustaining system for virtual gifts to be created, curated, bought, sent and exchanged. This can be done through any global content platform such as YouTube, Instagram, and Facebook, and others.
These virtual gifts, stored as smart contract assets on the blockchain, will be universal and exist independently of any content platform. Fans will be able to send these virtual gifts to their favourite content creators on any platform, via just a web link, without any plugin or additional technical integration.
On the rationale to open up the creation and sale of virtual assets outside of the Uplive platform, Tian explained: “I have my own limits – I can only create 50 to 60 gifts per month. Everyone wants their own customised gift but I can’t do that on my own so I have to decentralise. You can think of Gifto as Uplive “lite”. You can create all the gifts yourself using my tools and my technology. You put a price to it then merchandise it to your user base. It will allow even more content creators to monetise their content through their platform of choice.”
“By decentralising, you can engage the audience outside of Uplive. 25 million users is not a lot. In the grand scheme of things, I think Uplive can reach 100 million users in time to come. But by decentralising it and making it easy to use without downloading an app, it will probably address more audience immediately. That’s why I’m doing it,” he further accentuated.
AIG launches Gifto
AIG launched Gifto in December 2017 through a public token sale, also commonly known as an initial coin offering, or ICO, which use has recently been shunned because of adverse publicity as well as the ire from regulators due to concerns over their speculative nature and links to fraud.
The token sale took place in Singapore under the supervision and approval of the Monetary Authority of Singapore, which is one of very few regulators globally that have issued stringent guidelines on the conduct of such sale.
It attracted over 14,000 applications but eventually over 600 buyers from over 24 countries managed to snap up the five million Giftos allocation during the private sale which was conducted on a first come first served basis.
Tian took pain to differentiate the Gifto token sale from a cryptocurrency offering, he explained: “My token sale is not targeting investors who buy and do nothing with it. This is a sale of token assets that can used. My product is very simple. Anybody can understand that my token is universal for payment of virtual gifts. I am happy to be regulated because I am a venture backed company and I am making a real product. Being regulated helps mme.”
He revealed that the buyers came mainly from Asia, which has become a hub for such sale, specifically, Koreans, Japanese and Singaporeans. It however specifically excluded citizens from China, the US and Vietnam which regulators have been actively discouraging even barring their citizens from investing in cryptocurrencies.
Tian also took pains to dispel the idea that blockchain is wholly speculative or fraudulent. He believes that the technology enables cryptocurrency to hold value and that it is proven.
“Now, how do we transit from cryptocurrency, something that holds value, to something of actual usage? The underlying blockchain technology used in consumer applications should benefit consumers who don’t have to know what blockchain is.”
Tian, who was the former head of Zynga China and spent some time also at Google Mobile, has extensive experience within the mobile entertainment industry. He shared: “When I was at Google Mobile, we were the first to introduce android system to Asia. The Android system in the first version was very hard to use. People are questioning if they should really use android at all. But nowadays, people don’t even think about that. All the complexities are hidden. Blockchain is the same. Blockchain is not a front-end technology; it is a back-end technology. Mobile users should not think about blockchain, they should want to enjoy the system.”
The platform to disrupt traditional revenue ways online
He reiterated: “We wanted to create a platform that will disrupt the traditional ways in which online content creators monetise their work, such as through advertising or sponsorship revenue. Through our Gifto platform, the 90% of broadcasters who currently see low monetary returns from these traditional methods will now have a new revenue stream through which their fans can directly contribute to them.”
The token offering marked AIG’s entry into the cryptocurrency space, it claimed it is the highest revenue consumer company in Asia to do so.
“The successful sale positions Gifto to become the blockchain application with the most users from outside the crypto industry, and is the first significant step in bringing blockchain technology to the mass market,” commented Tian.
And for cryptocurrencies to work in the financial services industry perhaps a few leaves of learning can be picked from AIG’s and Tian’s book. The chief of which is that there must be an underlying real-world usage or application of the technology that is driving consumer demand which in turn is backed by the consumer’s willingness and desire to pay for it and thereby creating a viable and sustainable revenue model.