The loss of contact between Douyu founder Chen Shaojie has made new progress. At noon on November 22, the Dujiangyan Irrigation Project public security microblog confirmed that Chen Moujie was suspected of opening a casino. At present, Chen Moujie has been arrested in accordance with the law, and the case is under further investigation.
Source: Weibo account "Dujiangyan Irrigation Project Public Security Bureau".
Previously, on the evening of November 21st, Douyu (DOYU. NASDAQ) announced that on November 20th, the company learned that Chen Shaojie, the CEO and Chairman of the Board, had been arrested by Chengdu police on or around November 16th. Douyu also stated that he has not received any formal notice regarding the investigation into Mr. Chen or the apparent reason for his arrest. Mr. Chen's continued detention and any subsequent legal proceedings and enforcement actions against the relevant parties may have a significant adverse impact on the company's reputation, business, and operating performance.
According to the latest disclosed equity information of Douyu, Chen Shaojie holds 17% of Douyu's equity. The current largest shareholder of Douyu is Tencent, which holds 37.7% equity in Douyu through its wholly-owned subsidiary. Douyu stated that the company will maintain normal business operations and continue to be committed to maintaining the regulatory compliance of the platform. The board of directors and management will oversee the company's operations and develop emergency plans for Chen Shaojie's arrest and related investigations.
Affected by this, the Douyumei stock market fell sharply before the market, with a drop of up to 10%. As of the close of November 21, Eastern Time, Douyumei's decline narrowed to 5.93%, at $905 per share, with a market value of only $289 million.
There are gambling games in multiple live streaming rooms
Times Weekly reporters have learned from multiple channels that Douyu Chen Shaojie has been arrested or related to gambling in multiple live streaming rooms under his umbrella, with the most well-known being 'Send Nine Outdoor'. A certain platform anchor told Time Weekly that many platform live streaming rooms have gambling games. The general gameplay is that the platform sets various lottery rules, and the anchor is responsible for attracting users to purchase props or gifts formulated by the platform. Users use these props or gifts to participate in the anchor's lottery activities.
The prices of these props or gifts range from a few yuan to several tens of yuan. If you win the lottery, you can earn thousands or even tens of thousands of yuan. It mainly depends on luck, and the platform controls the odds. Some anchors directly post the amount, such as 50000 live streaming lottery, with a prize of 50000 and tens of thousands of people participating. Through these operations, the anchor platform can make a steady profit without losing, "said the above person.
He further stated that in the Douyu live broadcast room, the platform sets gifts or props at prices ranging from six yuan, with tens of thousands of users participating in the live broadcast room. Many people cannot just give a gift for the entire live broadcast, many of which are hundreds or thousands of brushes. A live broadcast will run into tens or millions of dollars, and the prize money will only be tens of thousands. By doing so, both broadcasters and platforms can benefit, "he said.
At the end of December last year, members of the "Send Nine Outdoors" studio were sentenced for similar gambling behavior, and the court of Dujiangyan Irrigation Project City, Sichuan Province, heard the case.
Fu Moulong and others (the anchor of "Sending Nine Outdoor") used a large amount of inflammatory language such as "one card application for 50000 yuan to take home" and "striving for a bike to become a motorcycle" to encourage the audience in the live streaming room to participate in the lottery, and pushed the lottery time and amount information to other people who did not participate in the live streaming viewing through platforms, WeChat groups, and other means, resulting in a large number of people entering the live streaming room during the lottery period, using paid card application Participate in the lottery by using virtual gifts and other methods.
The Dujiangyan Irrigation Project Court held after hearing that Fu Moulong and others organized gambling activities by lottery using the live broadcast room of the platform. The circumstances were serious, and their acts constituted the crime of opening a casino. Taking into account the role, confession, and surrender of Fu Moulong and others in the joint crime, they were sentenced to imprisonment ranging from six to three years and also fined.
In addition, Douyu has also been broadcasting "Changsha Rural Expendables" and has been publicly reported by the media for gambling. According to a public report on China Economic Network in early 2021, the "Changsha Rural Death Squad" used various lottery rules for Douyu to engage in suspected gambling activities. Users can participate in a virtual currency lottery worth 1000 to tens of thousands of yuan by purchasing designated items within a certain period of time. The "Changsha Rural Expendables" then purchased virtual currency in equal amount through third-party channels such as Alipay or "backpackers" to cash in their bonuses.
China Economic Network reported that the live broadcast room often starts gambling and lottery at 10 pm. The "Changsha Rural Expendable Team" also refers to gambling as the "10 pm Economic Class" and uses the "start class at 10 pm" as a public secret code. Many teenagers are addicted to it, suffering heavy losses and unable to extricate themselves. Some users made crazy bets of over 300000 yuan in the live streaming room within half an hour.
According to statistics from third-party live streaming data platforms, the "Changsha Rural Expendable Team" achieved a revenue of 177 million yuan and a daily turnover of 13.1767 million yuan in 2020. Among them, the highest income was in March, with a monthly revenue of 74.87 million yuan and a daily revenue of approximately 2.41 million yuan.
Despite repeated bans on vulgar content, performance has declined for three consecutive years
In addition to gambling, Douyu platform has also been administratively punished for vulgar content in the live broadcast room. In April of this year, the Daily Economic News reported that the live streaming room promoted on Douyu's homepage was not a popular game, but a dance performance. The room descriptions were written as "Otaku Goddess", "Long Legged Super Model", "Sexy Dance Queen", and so on.
Times Weekly reporter's review of Tianyancha found that since 2020, Douyu platform has been subject to administrative penalties at least six times for performing content that involves violence, vulgarity, and soft yellow. The most recent incident was in September 2022, according to the punishment reasons, law enforcement personnel received a notice from the Wuhan City "Anti Pornography and Anti Illegal Activities" Working Group Office regarding the verification of some anchors suspected of vulgar performances in "Douyu Live". They found that three live broadcast rooms had violated the vulgar performance methods during the live broadcast process. The reward income from the three live broadcast rooms on the day of the violation was equivalent to a total of 435.9 yuan, which was used as the illegal income, And impose a fine of 30000 yuan on Douyu.
Frequent punishment, worrying content ecology, and continuous decline in Douyu's performance in recent years. According to the financial report, from 2020 to the first half of 2023, Douyu achieved revenue of 9.602 billion yuan, 9.165 billion yuan, 7.108 billion yuan, and 2.875 billion yuan respectively, an increase of 31.84%, -4.55%, -22.44%, and -20.77% year-on-year.
In the first half of this year, Douyu just achieved a turnaround. From 2020 to 2022, Douyu's net profit attributable to the parent company was 486 million, -582 million, and -75.42 million, respectively. By the second quarter of this year, its net profit attributable to the parent company increased to 21.37 million yuan. The Douyu financial report stated that since controlling costs and operating expenses, the loss margin has been continuously narrowing, and continuous profits have been achieved in the first and second quarters of this year.
In the second quarter of this year, Douyu's core business live streaming revenue was 1.258 billion yuan, a year-on-year decrease of 28.8%. Business is shrinking, and platform users are also significantly declining. According to financial reports, the average monthly active mobile users of Douyu have decreased from 55.7 million in the second quarter of 2022 to 50.3 million in the same period of 2023, and the average number of paid users has decreased from 6 million in the second quarter of 2022 to 4 million in the same period of 2023.
