CASE STUDY : PPS.tv and China's Online Video Distribution Market. Kevin Anthony, Roger Erdong Chen, Aaron Rackoff, Wai Yan Wong.Study Questions 1. If you were on the G-Lab project team, how would you evaluate the strategic options? What factors would be critical to consider? 2. What would you recommend to PPS? Why?08-074
July 29, 2008
This case was prepared by Kevin Anthony, Aaron Rackoff and Wai Yan Wong (MIT Sloan MBAs, Class of 2008) and Roger
Erdong Chen (MIT, doctoral student in Electrical Engineering and Computer Science), under the supervision of lecturer M.
Copyright © 2008, Massachusetts Institute of Technology. This work is licensed under the Creative Commons Attribution-
Noncommercial-No Derivative Works 3.0 Unported License. To view a copy of this license visit
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PPS.tv and China's Online Video Distribution Market
Kevin Anthony, Roger Erdong Chen, Aaron Rackoff, Wai Yan Wong
As Kevin Anthony, Roger Chen, Aaron Rackoff, and Wai Yan Wong—members of a G-Lab team
from MIT Sloan—sat on the steps of the crowded terminal at Hongqiao Airport in Shanghai, China,
Chen broke the silence: “There’s no easy way out.”
Chen was referring both to the jam-packed airport exits and to the strategic dilemma facing one of the
team’s project clients, PPS.tv (PPS), a Chinese peer-to-peer (P2P) online video provider with venture
capital backing from Qiming Venture Partners. By January 2008, PPS had reached a pivotal stage of
its expansion, and was under significant pressure to deliver both profitability and a larger user base.
In order to do so, the small start-up had to decide which strategic direction made the most sense.
The first option was to focus on the small and relatively immature online advertising market in China,
dominated by much larger and more established portal sites. Another option was to attempt to
internationalize PPS’ service offerings in the United States and other countries where more money
was available, notwithstanding the company’s lack of expertise, customers, or extensive content
provider relationships. Third, the firm could shift its focus to its technical strong suit and patent the
company’s highly innovative streaming protocol technology, licensing its technology to leading
content distributors abroad.
With China’s online video space becoming more and more competitive by the day, PPS could not
waste time in choosing a direction.