Bilibili Stock

Bilibili Inc. (Bilibili) primarily engages in the operation of providing online entertainment services to users in the People’s Republic of China (the ‘PRC’ or ‘China’).

Bilibili is an iconic brand and a leading video community for young generations in China. Video is an intuitive, vivid and informative way to connect people with the world and has become a dominant medium for communication, entertainment and information. The company refers to the trend of video integrating into the scenarios of everyday life as ‘videolization.’ As a go-to video community for young generations in China, the company is well positioned to capture the attractive opportunities created by videolization.

The company is a full-spectrum video community that offers a wide array of content serving young generations’ diverse interests. The company provides users with ‘All the Videos You Like’ as the company’s brand proposition. The company has built its community around aspiring users, high-quality content, talented content creators and the strong emotional bond among them. In the company’s community, users and content creators discover and interact with diverse content encompassing different interests, from lifestyle, game, entertainment, anime, knowledge to many more. The company also enables broad video-based content consumption scenarios centered around professional user generated videos, or PUGV, supplemented with live broadcasting, occupationally generated videos, or OGV, Story Mode, the company’s short-form video product, and more. The company has become the welcoming home of diverse cultures and interests and the destination to discover cultural trends and phenomena of young generations in China. The company also promotes Chinese original content advocating Chinese culture both in China and overseas.

The company adopts a user-centric commercialization model. The company is a full-spectrum video community, and the company’s ever-growing content ecosystem continues to satisfy the company’s engaged and loyal users’ evolving needs, providing the company with multiple levers for user-centric commercialization. The company generates revenues primarily from mobile games, VAS, advertising, e-commerce and others.

Users

The company has a young and culturally aspirational user base who are willing to invest in high-quality content and engaging user experience. Gen Z+ constitutes the core of the company’s user base. The company’s user base is broadening to include users across different age groups and locations, who take interest in a full spectrum of content. The company encourages users to not only discover and view, but also share and create quality content on the company’s platform. The company is dedicated to providing a wide variety of high-quality content to retain its existing users and attract new users with diverse interests and backgrounds.

In 2022, the company had an average of 314.5 million MAUs and 86.5 million DAUs. The company’s users have demonstrated high level of engagement on the company’s platform. The average daily time spent per active user on the company’s mobile apps reached 94 minutes in 2022. In 2022, the company had approximately 3.4 billion average daily video views.

As of December 31, 2022, the company had approximately 194.8 million official members. The company offers certain major interactive features on the company’s platform exclusively to official members, such as sending bullet chats, commenting and messaging, as the users who take and pass the company’s membership exam are tuned to its community culture and values, hence contributing to the company’s sticky user community with high retention rate.

Content Ecosystem

The company has built an ever-growing content ecosystem that is centered on video-based content, including PUGV, live broadcasting, OGV, Story Mode and more. The company’s full-spectrum content ecosystem enables the company to become a one-stop platform for users to find a wide variety of content that matches their interests and preferred video consumption scenarios, and for content creators to fully showcase their talent. The more talented content creators gather on the company’s platform, the more inspiring and high-quality content is created, leading to more users, more engagement, and more followers and feedback for the company’s content creators, which in turn encourages more content creators to join.

Content

The company offers a full spectrum of engaging content, including video services, mobile games and value-added services, or VAS. The company’s content offerings cover a wide variety of categories. In 2022, the company had approximately 3.4 billion average daily video views, representing a 75.9% year-over-year growth.

The company offers a comprehensive suite of video services, with PUGV as the cornerstone of the company’s content ecosystem, and live broadcasting, OGV and Story Mode as major attractions of the company’s platform.

PUGV

PUGV are the cornerstone of the company’s content ecosystem and the main engine that powers the company’s growth. With the development of affordable and easy-to-use hardware, including digital camcorders and mobile devices with high-resolution video cameras, as well as 5G technologies, the barrier for producing quality video content is gradually vanishing. Video production is now done by a wide range of participants, from amateurs, to semi-professional individuals with certain levels of production and editing skills and to professional production studios or workshops, with the lines between each category of content creators becoming increasingly blurred.

The company has a deep and diverse repository of PUGV on its platform. The PUGV on the company’s platform typically showcase the content creators’ knowledge and expertise in the relevant field, providing viewers with a fulfilling experience and creating positive word-of-mouth. PUGV are popular among the company’s users due to their originality and creativity, as well as their interactive characteristics. In 2022, the company received an average of approximately 14.7 million monthly videos submissions. These videos were submitted by an average of approximately 3.7 million monthly active content creators in 2022.

With a growing number of content creators and the effective incentive mechanisms the company provides to the content creators, the company receives increasingly diverse and innovative content submissions, which contribute to the company’s mass market appeal. The company’s most popular PUGV categories were lifestyle, game, entertainment, anime and knowledge in terms of number of video views in 2022. While the company enhances content offerings in the company’s leading categories, the company is actively expanding its content reach to new categories to cater to the evolving consumption needs of the company’s users.

The company is broadening its video formats to address users’ needs in different access scenarios. The company introduced Bilibili app on smart TV as a solution for users seeking high quality, high resolution and immersive video experience on a larger screen.

Live Broadcasting

The company views live broadcasting as a natural extension to the video services, which allows users to interact and engage in real time, integrated with various content categories and user interests. In 2022, the company integrated live broadcasting within its PUGV ecosystem, which has helped to motivate more users and creators to tap into the company’s live broadcasting universe.

Games are the most popular category of the live broadcasting content on the company’s platform. For example, in September 2020, the company acquired a three-year exclusive license for live broadcasting the League of Legends E-sports global events in China. The 2022 League of Legends World Championship remained popular. During the S12 season, the peak popularity index for the company’s Bilibili official live broadcasting room surpassed 300 million, and over 100 million users watched League of Legends-related content on the company’s platform.

In addition to live broadcasting of games, the company provides entertainment live broadcasting consisting of virtual host live broadcasting, audio-related live broadcasting and other live broadcasting. The company is continuously enriching its live broadcasting content and increasing user penetration. The company is dedicated to attracting more talents and hosts to introduce more live broadcasting channels and provide diversified content. The diverse live broadcasting content provides an interactive user experience and contributes to the company’s user growth.

OGV

The company’s OGV offering consists of Bilibili-produced or jointly produced content and licensed content procured from third-party production companies. The company leverages its rich OGV offering to accumulate IP assets, attract more users and convert them into paying users, inspire the creation of PUGV content creators and to expand content categories to supplement the PUGV content.

The company’s original content includes both Bilibili-produced and co-produced content with quality domestic and international third-party partners. The company typically leverages its insights of users’ preferences and collaborate with professional production companies to produce OGVs. The company’s OGVs have a primary focus on anime, but also include a variety of genres, such as documentaries, variety shows, selected TV shows and movies.

The company has a large anime library, providing Chinese anime and Japanese anime series, etc. In October 2022, the company announced 49 new Chinese anime titles on the company’s 5th Made by Bilibili Chinese Anime Press Conference. In 2022, the company launched a self-produced Chinese anime, the Three-Body Problem, which is well received by its fans.

The company has also established business cooperation with overseas distributors, including Netflix and Sony, distributing the company’s high-quality Chinese content to the global markets.

In addition, the company has partnered with reputable content providers for licensed videos, including leading PRC and overseas television networks and studios.

Mobile Games

There is a large population of online games enthusiasts among the company’s users. Game is the second most popular category of the company’s PUGV and the most popular category of the company’s live broadcasting content in 2022. The company views mobile games as an adaptive form of video-based content that share many commonalities. Leveraging the company’s deep understanding of users’ preference in online games and rich experience in games operation and distribution, the company selects and develops mobile games compatible with the company’s users’ interest, such as mobile games in the field of ACG where the company hold advantages. As of December 31, 2022, the company operated multiple exclusively distributed mobile games and hundreds of jointly operated mobile games.

The company has obtained the exclusive distribution rights of various mobile games from leading global and domestic mobile game developers. The most popular exclusively distributed mobile games on the company’s platform include Fate/Grand Order, Azur Lane and Princess Connect! Re: Dive. In addition to exclusively licensed mobile games, the company also jointly operate a large number of mobile games with well-known domestic developers. Popular jointly operated mobile games on the company’s platform include Genshin Impact and Arknights. The company continued to leverage the company’s competence in the ACG sector with like-minded ACG game lovers in overseas markets, including South Korea, Japan, and other countries.

Along with the company’s strategy of ‘Develop In-house, Distribute Globally,’ the company is committed to building up its internal game self-development capabilities, leveraging the company’s deep understanding of user preferences and its rich game operating experience.

Maoer and Bilibili Comic

Leveraging the company’s mass user base of ACG enthusiasts, the company expanded its offering to ACG-related comic and audio content and efficiently converted a large number of the company’s existing ACG enthusiast users to audiences of the new offerings. The company launched the Bilibili Comic, a mobile app offering anime and comic content in 2019 to enrich the company’s content offerings. In the same year, to further expand the company’s content offerings, the company started to offer audio drama, such as audio books and music mainly contributed by professional and amateur content creators that can be accessed through Maoer, an audio platform. As a natural extension from the company’s core ACG content offerings, the company sees synergy effects between the company’s main platform and each of the Bilibili Comic and Maoer platform.

Content Creators

The company has cultivated a nourishing environment to allow content creators to grow and flourish on the company’s platform, empowering them to easily upload content, actively interact with users and effectively accumulate broader fan bases. The company respects original creation and works to ensure that the company’s content creators will stay and grow with the company’s platform. In 2022, the company received an average of approximately 14.7 million monthly videos submissions. These videos were submitted by an average of approximately 3.7 million monthly active content creators in 2022. PUGV contributed to 94.6% of the total video views on the company’s platform in 2022.

Retaining and expanding the company’s network of content creators who upload and contribute quality content to the company’s platform is essential to the company. The company has taken a number of initiatives to encourage and facilitate production of creative PUGV by content creators. The company provides multiple monetization avenues for the company’s content creators to unlock their commercialization potential, including but not limited to, cash incentive program, native advertising, virtual gifting in live broadcasting and customized commercial contracts.

The company identifies certain content creators and talent that create popular content and represents the company’s values and beliefs and execute customized contracts with them. The company also cooperates with talent agencies, which recruit, manage, train, support and promote content creators and hosts. Customized host contracts are negotiated on a case-by-case basis and generally contain revenue sharing arrangements and exclusivity clauses.

Community

Community Operating Features

The vitality and integrity of the company’s communities are cornerstones of the company’s business and a priority of the company’s business development strategy. The company’s users are attracted to its platform because of its creative content and retained by the company’s diverse, inclusive and vibrant community. To preserve the company’s culture and community values, the company has employed the following features in operating the company’s communities.

Membership Exam: Users need to pass the company’s multiple-choice membership exam consisting of 100 questions in order to become the company’s ‘official members,’ after which additional interactive and community features, such as bullet chatting and commenting, will become available to them. The membership exam includes questions on community etiquette regarding uploading videos and sending bullet chats, and a set of interest-based questions from a range of topics, such as anime, music, fashion and technology. Users need to answer a total of 60 questions correctly to pass the membership exam. As of December 31, 2022, the company had approximately 194.8 million official members who had passed the company’s membership exam.

Signature Community Management: Official members who have passed the membership exam tend to develop a strong sense of belonging and ownership to the company’s platform. To protect the community values and contribute to a more harmonious community, the company’s veteran users have voluntarily formed a community discipline committee to collectively evaluate the appropriateness of content posted on the company’s platform, the results of which will be used to train the company’s AI system for content and information monitoring on the company’s platform. If the company confirms that a user has uploaded content that contains inappropriate content, such as pornography, violence, provocative or hate speech, invasion of personal privacy, personal attacks, and fraudulent or other offensive information, the company may temporarily suspend or permanently terminate such user’s account, and display such user’s account information and reason for the disciplinary action under the ‘Dark Chamber’ tab, which is open to all users on the company’s platform. This measure also allows users to participate in the management of the company’s communities and helps the company educate users and foster a self-regulating environment to preserve and strengthen the community values that the company holds dear.

Community Events: Every year, the company holds large festivals and community events for the company’s users, including New Year’s Eve Gala, Bilibili Power Up, Chinese New Year Gala, Bilibili Macro Link and Bilibili World. In January 2023, the company hosted the Bilibili Power Up of 2022 to celebrate and award the outstanding achievements of leading content creators in various categories. The company marked the end of the year with the company’s New Year’s Eve Gala, The Most Beautiful Night of 2022, which maintained its popularity among young generations in China.

Social and Interactive Features

The company’s communities are built on creative content, as well as vibrant interactions among users. Users’ interactions on the company’s platform revolve around content, and the social and interactive features of the company’s platform allow users who share similar interests and hobbies to find, engage with and bond with each other to establish a common bond. The company provides the following social and interactive features for its users. In 2022, the company’s users generated 13.2 billion average monthly interactions on the company’s platform.

Bullet Chatting: Bullet chatting is a commenting function that the company pioneered, which enables content viewers to send comments that fly across the screen like bullets, and has become very popular among young internet users in China. Only official member who passed the company’s membership exam can send bullet chats on the company’s platform. Bullet chats are context-based and can be viewed by the audiences who watch the same content, and therefore can intrigue interactive commenting among content viewers. The bullet chatting feature has transformed the video-viewing experience from one-way content display to a brand-new interactive experience by sharing with other enthusiasts who empathize with each other.

Other Interactive Features: Users can show appreciation in various ways to encourage content creators, such as liking, voting, following, adding to favorites and casting coin. Users can also opt to follow a content creator so they can see the content creator’s newly posted activities promptly on their own timeline. In addition, the company invented a unique interaction feature, ‘one click triple-function combo.’ Through one long pressing on the screen, users can complete liking, coin casting and adding to favorite library in a roll to show their special appreciation, which has become Bilibili signature interactive function and been widely used in the company’s community.

Interacting with Fans: Content creators can use moment, live broadcasting and interactive video to interact with their fans. Bilibili moment enables users to express and share their interests and stories in multimedia content, such as text, pictures and video. Bilibili live broadcasting allows content creators to set up channels to interact with fans on a real-time basis and express their appreciation to the talents of live broadcasting host by virtual gifting.

Gifting and Rewarding: Users can send free or paid virtual items to live broadcasting hosts and content creators to show their support and appreciation.

Sharing and Communicating: Users can share and repost content uploaded by other users, add comments, send instant messages and view their history of interactions with other users.

Platform

The company’s platform includes its ‘Bilibili’ mobile apps, PC websites, Smart TV and other smart devices, Bilibili Comic, Maoer and a variety of related features, functionalities, tools and services that the company provides to users and content creators. For mobile devices, users typically access the company’s content through its Bilibili mobile apps, or a mobile website that is largely similar in terms of functionality and appearance to the company’s mobile apps. The company’s mobile apps are available for user download from the Apple and Android app stores. The company also provides a PC website at www.bilibili.com and offers quality content across on smart TV devices.

The company utilizes its big data analytical capabilities in its feed system to categorize and recommend content based on user data captured on the company’s platform and analytics produced by the company’s deep learning algorithms. The basic features the company offers on its platform include content uploading, viewing and commenting. The company’s platform also can categorize, rank, search for, curate and recommend content uploaded and viewed to simplify the content discovery process.

Commercialization Model

Capitalizing the company’s engaged user base, expanding content ecosystem, and vibrant community, the company is well positioned to capture users’ evolving demand and increase lifetime value of the company’s users by satisfying such demand. As the company develops deep insights into user interests and behavior, the company curates the right content and service offerings compatible with user demand, achieving efficient user-centric commercialization. The company’s commercialization efforts are based on the integrated goals of offering quality content catering to user preference to attract users, building vibrant communities to retain users, and provide quality content and products to achieve commercialization. The company generates revenues primarily from mobile games, VAS, advertising, e-commerce and others. In 2022, the company’s average number of monthly paying users was 27.8 million.

Mobile Games

Games is the second most popular genre category of the company’s PUGV based on video views in 2022. A substantial portion of the company’s users are game lovers. The company started to publish mobile games on the company’s platform for third-party developers in January 2014, and launched the company’s first self-developed game in August 2017.

Recognizing the large population of game lovers among the company’s users and a strong propensity to spend on mobile games of the company’s typical users, the company started to introduce anime and comics themed mobile games that resonate well with the company’s communities and user preferences. Some of these games are sourced taking into consideration of the popularity of related video content on the company’s platform. Mobile games have thus become a natural extension of the company’s video content offerings through which the company achieve efficient monetization. In addition, the company’s sticky user community with strong preference for ACG-related content enables the company to obtain exclusive distribution rights of various popular, high-quality mobile games from leading global and domestic game developers, particularly with regards to ACG-themed mobile games.

As the company’s user base and user demand expanded, the company continued to launch new service offerings and diversified its monetization channels beyond mobile games.

The majority of mobile games on the company’s platform are developed by third-party developers and the company selects and curates mobile games on the company’s platform based on content, themes, cultural characteristics and features that appeal to the company’s users. The company’s users access the mobile games on the company’s platform, and log into and play with their Bilibili accounts. Users’ purchase of in-game virtual items to enhance their game-playing experiences is the primary source of the company’s revenue generated from mobile games. As of December 31, 2022, the company operated multiple exclusively distributed mobile games and hundreds of jointly operated mobile games.

For the company’s exclusively distributed mobile games, the company generally was granted royalty bearing license with the exclusive right to market and distribute mobile games in China and other countries and regions in Asia. The company is responsible for game launch, hosting and maintenance of game servers, game promotions and customer services. The company also develops localized versions for games licensed from overseas developers.

For the company’s jointly operated mobile games, the company entered into joint operating agreements with game developers and distributors pursuant to which the company was granted non-exclusive licenses to promote and distribute games on the company’s platform. The company earns game distribution service revenue within the applicable contract periods by providing payment solutions and game promotion services, while game developers are responsible for providing game products, hosting and maintaining game servers and determining the pricing of in-game virtual items.

To cater to the next generation’s game demand, the company is also building up its game self-development capabilities, leveraging the company’s deep understanding of user preferences and the company’s rich game operation experience.

VAS

The company also achieves commercialization through the various types of VAS the company offers, including the company’s live broadcasting, premium membership program, and other value-added services, including comics on Bilibili Comic and audio drama on Maoer.

The company extends diversified live broadcasting content covering a broad range of interests. The company offers various virtual items for sale on its live broadcasting. Users can purchase in-app virtual items and send them as virtual gifts to their favorite hosts to show appreciation and provide them with monetary rewards. As the company integrated its live broadcasting ecosystem within its PUGV ecosystem, more content creators and users tapped into the live broadcasting universe and the revenue generated from sales of virtual items increased.

The company shares revenues from the sales of virtual items generated on its live broadcasting with the company’s hosts and talent agencies. The company encourages its content creators to host live broadcasting on the company’s platform to interact with their fans on a real time basis, enhance their popularity and in turn attract and retain users. The company has entered into exclusive cooperation agreements with certain hosts with top popularity on the company’s platform.

In January 2018, the company launched a premium membership program allowing paying members to enjoy exclusive or advance access to certain high-quality OGV content. As of December 31, 2022, the company had 21.4 million premium members.

The company also offered anime and comic content through the mobile app, Bilibili Comic and offered audio drama through Maoer audio program from 2019 to expand the company’s content offerings. As a natural extension from the company’s core ACG content offerings, the company sees great synergy effects between its main platform and each of the Bilibili Comic and Maoer platform and their significant growth potential.

Advertising

The company’s typical users are the Gen Z+ population, many of whom are well educated and enjoy increasing disposable income. This group of users are a golden cohort that advertisers pursue very strongly. The company’s rapidly growing community and increasing brand awareness make Bilibili an appealing platform for advertisers wishing to gain more exposure to this highly coveted group.

The company offers various advertising formats, including brand advertising, performance-based advertising and native advertising. Brand advertisements primarily appear on the app opening page, the top banner, the website home page banner and the inline video feed alongside organic feeds. Brand advertisements can also be customized according to advertisers’ need and appear in Bilibili-produced OGV or events. Performance-based advertisements appear in various formats, such as video or picture feeds alongside organic feeds, a banner underneath the video-playing frame, a link, banner or pop-up in the Story Mode, and a link in the comment section appearing below the video. Native advertisings are customized according to advertisers’ needs, produced by the company’s content creators and embedded naturally in their video creations.

In addition, the company offers integrated marketing campaigns to provide a one-stop marketing solution for the company’s advertisers. Advertisers can leverage the company’s brand advertising to raise their brand awareness, use native advertisements to influence user’s purchase decision and convert sales through the company’s performance-based advertisements. The all-around marketing campaigns were well-received by the users and brought satisfactory results for the company’s advertisers. In 2022, The company has added more advertising opportunities to various video viewing forms in the company’s ecosystem, including PUGVs, live broadcasting, Smart TVs and Story Mode.

E-commerce and Others

The company’s e-commerce initiatives are focused on the derivative merchandise of ACG-related content. The company offers ACG-related merchandise and generates revenue from sales of these products. For example, for users who are particularly interested in a certain anime, the company recommends to them merchandise of the same theme, such as figure toys, and convert into sales on the company’s e-commerce platform. The company also generates revenue from certain offline activities the company holds, including e-sports copyright sub-licensing, selling events tickets and peripheral products.

Strategic Partners

The company collaborates with reputable industry players to enhance its content offerings and to strengthen the company’s user-centric commercialization capabilities. The company partners with domestic and overseas content partners to continually expand and deepen the company’s content repository. The company also works with talent agencies in expanding its content creator group, as well as in diversifying the company’s content offerings. The company contracts with talent agencies to recruit, manage, train and support the company’s hosts and pay talent agencies a percentage of the total revenues from virtual gifting made to the hosts managed by such talent agencies. The company works with advertisers in a variety of industries due to the company’s rapidly growing community and increasing brand awareness. The company enters into advertising service agreements with advertisers directly or through advertising agencies.

The company cooperates with leading global and domestic mobile game developers to distribute their mobile games on the company’s platform. Under the company’s agreements for exclusively distributed mobile games, the company is typically responsible for the launch of the games, hosting and maintenance of game servers, determination of when and how to operate in-game promotions and customer services and the pricing of in-game virtual items, and making localized versions for overseas licensed games. Under the company’s agreements for jointly operated mobile games, the company is typically responsible for distributing games and providing payment solution and market promotion service. Proceeds earned from selling in-game virtual items are shared between the company and the third-party game developers pursuant to the agreements. The company’s large and diverse user base presents a prime opportunity for the company’s strategic partners to reach a growing number of audiences. The company has also entered into revenue sharing arrangements with distribution channels, including iOS and Android-based app stores to distribute the company’s mobile games. To provide multiple payment methods for the company’s users, the company contracted with online payment channels and pay fees based on the amount of payment made through the payment channel.

In October 2018, Tencent, the company’s principal shareholder, further invested in the company, and the company entered into a strategic collaboration agreement with Tencent for sharing and operating existing and additional anime and games on Bilibili’s online platform, pursuant to which the company and Tencent shall participate in the exchange and purchase of existing anime copyright, and jointly procure, produce and invest in anime projects, as well as seek investment opportunities in the anime and comic industry. In addition, the company would expand its cooperation with Tencent by jointly operating more Tencent games on the company’s platform.

In December 2018, the company and Alibaba Group commenced its business collaboration in the content creation and commercialization front. Under the agreement, content creators on Bilibili will promote merchandise by producing content in a creative and interactive format. Taobao will also work with the company to promote and commercialize Bilibili’s IP assets, leveraging consumer insights on both platforms. Alibaba Group became the company’s principal shareholder in February 2019 and further increased its shareholding in the company’s company in 2021. Alibaba has become one of the company’s major brand advertisers. In 2022, the company deepened its cooperation with Taobao in the field of video e-commerce by enabling direct links or banners and pop-ups that could directly link to Taobao’s website in the company’s video products.

In April 2020, the company received a strategic investment from Sony and entered into a business collaboration agreement to pursue collaboration opportunities within the area of entertainment business in the Chinese market, including anime and mobile game. The company would support Sony in deepening its understanding of and insight into the Chinese entertainment market. In October 2020, the company deepened its partnership with Sony by entering into a strategic agreement with its subsidiary Aniplex Inc. to introduce more high-quality anime content and mobile games on the company’s platform. Under the agreement, the company will obtain certain exclusive distribution rights of Aniplex’s anime content and will pay Aniplex different fees per episode for different anime series. The company also entered into revenues sharing arrangements for exclusive distribution of Aniplex’s mobile games. The company also collaborated with Funimation, the global anime streaming platform of Sony, to distribute the company’s Chinese anime works to the worldwide audiences.

Branding and Marketing

The company is retaining and expanding its user base by providing high-quality content. The company has cultivated a deep and diverse content pool well recognized among Generation Z+. In addition to viral marketing, word of mouth referrals and repeat user visits driven by superior user experience, quality content and product offerings, the company implements various branding and marketing measures to promote its brand awareness among existing and potential users with prudently managed sales and marketing expenses.

In keeping with the company’s slogan, Bilibili-All the Videos You Like, the company holds various activities to reinforce its impacts across different user demographics. For example, the company launched China’s Youth Day promotion video and Teachers’ Day promotion video to increase the company’s awareness in student and teacher groups. The company marked the end of the year with the company’s fourth successful New Year’s Eve Gala, The Most Beautiful Night of 2022, which maintained its popularity in the company’s community. These branding and marketing initiatives have allowed the company to connect and resonate with more users and expand to more diverse audience.

In 2022, the company had an average of 314.5 million MAUs and 86.5 million DAUs.

User Privacy and Safety

The company provides users with adequate notice and authorization as to what personal information are being processed and undertake to protect and process the personal information in accordance with applicable laws and make reasonable efforts to prevent the unauthorized use, loss or leak of user personal information. The company’s user privacy policy, Bilibili Privacy Policy, has clearly specified the type of user personal information that will be collected under different scenarios. For example, a user will need to provide phone number to receive verification code when registering an account on the company’s platform. When a user downloads (including the re-download after uninstallation) and opens the company’s mobile app for the first time, or any modification is made to the Bilibili Privacy Policy, the company will notify the user of the Bilibili Privacy Policy in a pop-up window and obtain the user’s explicit consent. In addition, the company uses a variety of technologies to protect the user personal information with which the company is entrusted and have a team of information security professionals dedicated to the ongoing implementation of data security practices. For example, the company stores all user personal information in encrypted format and strictly limit the number of personnel who can access those servers that store user personal information. For the company’s external interfaces, the company also utilizes firewalls to protect against potential attacks or unauthorized access.

Content Management and Review

The company maintains two levels of content management and review procedures to monitor the content uploaded to the company’s platform to help ensure that no content that may be deemed to be illegal or inappropriate under government rules and regulations is posted and to promptly remove any infringing content. The first level of review procedure is conducted through the company’s proprietary artificial intelligence-based screening system. This system automatically flags and screens out newly uploaded videos that have piracy issues or contain illegal or inappropriate content by comparing them with copyrighted or objectionable videos stored in the company’s own in-house ‘black list’ databases and identifying those with similar codes. Once the content is processed by the company’s technology screening system, the company’s system then extracts fingerprint trails from the content and sends them to the company’s content screening team for the second-level review. As of December 31, 2022, the company’s content screening team consisted of over 3,800 employees dedicated to screening and monitoring the content uploaded on the company’s platform to ensure that the flagged content identified by the company’s screening system is reviewed and confirmed before it can be released. The company provides initial training during the onboarding process for new hires. The company also offers periodic training sessions to keep these employees apprised of any regulatory and policy changes, and supervise and monitor their work. All of the content needs to go through these two levels of review procedures before it is released on the company’s platform.

All of the other content, primarily consisting of bullet chats posted by users, is also automatically filtered by the company’s screening system, which utilizes an artificial intelligence-based screening system to conduct semantic analysis on bullet chats to analyze, identify and screen out inappropriate bullet chats. With respect to live broadcasting, the company has a separate monitoring team to review and monitor the content and activities of hosts of the company’s live broadcasting, as well as the bullet chats posted by viewers. The monitoring team for live broadcasting consisted of about 400 members as of December 31, 2022, and the company sometimes assigns more team members from its general content screening team as necessary. The live broadcasting reviewing process is similar to the two-level review procedure described above. Further, in addition to responding to user complaints, the company’s monitoring team frequently visit different live broadcasting rooms to ensure the appropriateness of the content.

The company utilizes a real-name system to authenticate the identities of the company’s content creators and live broadcasting hosts. In addition, before each upload, the user has agreed to the terms and conditions set forth in the user agreement of the company’s platform. Pursuant to such user agreement, each user undertakes not to upload or distribute content that violates any PRC laws or regulations or infringes the intellectual property rights of any third party, and agrees to indemnify the company for all damages arising from third-party claims against the company caused by violating or infringing content uploaded or linked by the user. Cooperation agreements with the company’s popular content creators also provide for standard clauses that restrict the content creators from uploading infringing content on the company’s platform. The company also removes users’ uploads when the company is notified or made aware by copyright owners or from other sources authorized by copyright owners of copyright infringements, such as lists of inappropriate or infringing content that the regulatory authorities publish from time to time and market information on releases of movies and television serial drama.

The company’s abuse reporting infrastructure allows the company’s users to report inappropriate, offensive or dangerous content to the company through ‘report’ links easily found on the company’s platform. Users can also report through customer service staff or third-party organizations. In addition, if the company confirms that user has uploaded content that contains provocative and hate speech, personal attacks, fraudulent information or other offensive information, the company may temporarily suspend or permanently terminate such user’s account, and display such user’s account information and reason for the disciplinary action under the ‘Dark Chamber’ tab, which is open to all users on the company’s platform. To protect the community values and contribute to a more harmonious community, the company’s veteran users have voluntarily formed a community discipline committee to collectively evaluate the appropriateness of content posted on the company’s platform, the results of which will be used to train the company’s AI system for content monitoring.

Research and Development

The company’s research and development expenses were RMB4,765.4 million (U.S.$690.9 million) in 2022.

History

Bilibili Inc. was founded in 2009. The company was incorporated under the laws of the Cayman Islands in 2013.