YY is an online social entertainment platform, which allows users to participate and interact in large group activities based on certain interests or topics. We monetise our business primarily by adding value to the consumer experience on our social platform.
Our proprietary routing algorithms and cultivated cloud-based infrastructure support the real-time communication among millions of concurrent users. Users create channels that cover particular interests or topics such as music, game broadcasting, dating, e-learning and finance. The increasing amounts of content attract more users to the platform, which in turns encourage more channels and activities. This recurring process leads to greater user engagement and a thriving social ecosystem.
Internet Value-added Services (IVAS) and third party advertisers are currently our main forms of revenue generation. In IVAS, we create and offer a variety of virtual items on our platform, which users can purchase with YY currency and prepaid game tokens. Virtual items are often purchased for gaining privilege status or being given to performers or channel hosts by users to show support and appreciation, or in the case of online games, for gaining advantages over other players. YY takes a proportion of the revenues generated from selling of the virtual items . In 2014, 96% of our total revenues were generated from IVAS businesses, including music and entertainment, online games, online dating, live game broadcasting and the membership program. In online education, we generate revenue through charging students tuition fees for accessing premium content. As a small part of the business, we also generate income from third party online advertising on our separate game media website Duowan.com.