Chinese Movie Ticketing Services Weiying, Gewara to Merge

Mobile ticketing services have exploded in popularity in China over the past two years, with 60 to 70 percent of all movie tickets in the country now bought online.

China's rapidly expanding and fiercely competitive online movie ticketing sector is beginning to show signs of consolidation.

Beijing Weiying Technology Co., the creator of the popular Wepiao ticket platform, said Thursday that it would merge with Shanghai-based Gewara.com, one of China's oldest digital ticket vendors.

The merger will allow the two services to pool their resources and better compete against their many rivals, the companies said in a statement.

Online movie ticketing has exploded in popularity in China over the past two years. An estimated 60-70 percent of all movie tickets are now sold online in the country. In North America, where ticketing sites have been in operation for over a decade, less than 20 percent of tickets are issued over the Internet.

While reliable local market share data is hard to come by, the combined platforms are expected to rank among the top three ticketing services in China.

Weiying was founded by Internet giant Tencent in 2014, and its apps are integrated into the company's wildly popular WeChat and QQ mobile messaging services. Last month, Weiying raised $230 million (1.5 billion yuan) in venture funding from corporate investors including Wanda Group and Beijing Wenzi Huaxia — the largest round ever in the movie-ticketing arena.

China's "big three" Internet companies — Baidu, Alibaba and Tencent — all operate or hold further stakes in additional ticketing services.

In an effort to attract users and gather valuable consumer data, the deep-pocketed online giants have helped drive the sector's explosive growth by issuing steep discounts. Tickets to last summer's blockbusters could often be procured from the various mobile services for as little as $2, far below China's usual ticket average of $6.50.

The discounts — which they have been willing to subsidize at a loss, at least in the short term — have helped drive the explosive growth at the Chinese box office, which expanded 48 percent in the first nine months of this year. But many industry watchers have warned that the practice could be detrimental to the Chinese industry in the long term, if consumer precedent is set at unsustainably low prices. 

The mobile ticketing service widely believed to be China's market leader is Maoyan, operated by the Groupon-like group-buying site Meituan.com, in which Alibaba holds a stake. Alibaba's entertainment subsidiary, Alibaba Pictures, runs its own mobile movie ticket service, Tabao Movie. The recent multi-billion dollar merger between Meituan and group-buying rival Dianping, which Tencent has invested in, has resulted in Maoyan being backed by both Alibaba and Tencent.

Recent chatter suggests Alibaba is looking to offload its stake, which would leave Tencent with a commanding position in the sector, backing Maoyan and newly combined Wepiao and Gawara.

Among the other services holding minority positions in China's massive mobile ticketing space are Nuomi, run by search giant Baidu, Mtime and an in-house ticketing app created by Wanda Cinemas, China's largest movie theater chain.
 

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