Headlines
- Chinese media outlets look set to make IPOs
- China’s culture industry hit 800 billion yuan in 2009
- Integration plan promotes radio, TV and film
- Time to review code on political advertising
- The future of television seen through rose-colored glasses
- Television revolution redux
- 20 jailed for CCTV tower blaze
- CABLESHOW-Cable warns programmers on rush to Web (World)
- Networks unlikely to profit from World Cup (world)
Chinese media outlets look set to make IPOs
Ten Chinese websites are to be listed in the domestic A-share stock market, according to media reports, with Shanghai-based eastday.com hoping to become the first to launch initial public offerings (IPO), analysts said. They include websites of China’s State broadcaster China Central Television, Xinhua News Agency, People’s Daily, Beijing-based qianlong.com, Tianjin-based enorth.com.cn, Shandong-based dzwww.com, Shanghai-based eastday.com and other local online news websites, Shanghai Securities News reported on Sunday, citing an anonymous source. “The Publicity Department of the Communist Party of China Central Committee and the China Securities Regulatory Commission (CSRC) are actively pushing the listing of these websites and, at least, one or two websites will make it this year,” the source was quoted as saying. China Daily contacted the CSRC and a spokesperson did not deny the report, but declined to divulge any further details or to comment on the situation,
Xu Yaowen, an analyst with China Galaxy Securities, said that eastday.com has completed share-holding reform and could be the first of the websites to be listed in the A-share market.
“As emerging media outlets, websites will create a breakthrough in the cultural development of China,” said Zhang Xiaoming, a researcher with the Chinese Academy of Social Sciences. With accelerated technological change, the new media are gaining increasing influence, he said.
However, analysts pointed out, as some of them belong to government agencies and are not wholly market oriented, they may not be able to receive listing in the capital market like free-market companies. Some commentators also oppose government-supported listing of media websites. Fan Feng, a Beijing-based commentator, said investor interest could be jeopardized, since the performance of these websites is not sound enough to bring the revenue expected by investors. Commercial portals, such as sina.com and sohu.com, have been listed in the overseas market. “The upshot is that competitive websites will receive listing overseas, while domestic listing is encouraged for second-class ones. Then how can domestic investors’ interest be protected?” Fang asked. (China Daily 05/10/2010 page2)
China‘s culture industry hit 800 billion yuan in 2009
The scale of China’s culture industry in the global market hit 800 billion yuan ($117.18 billion) in 2009, according to a report jointly issued by the culture research center of Chinese Academy of Social Sciences (CASS) and Social Sciences Academic Press, chinanews.com reported. The report says the culture industry has become a strategic industry for China.
According to the report, new media has emerged as a major force in the culture industry. Fueled by 3G technology, the number of mobile netizens rose to 233 million in 2009, amounting to 60.8 percent of the total, the website said. The film industry is also poised to grow, according to the report. China produced 456 feature films last year, ranking third in the word, following India and the US, according to the news report. The report also shows that the country’s cable television users increased by 6.1 percent year-on-year to 174 million in 2009, with nearly 62 million of them being digital television users, a 36.94 percent increase from the previous year The domestic market for artistic performance kept a strong momentum last year, and the supply and demand of performances have been growing, the website reported.
According to statistics from the General Administration of Press and Publication, China’s press and publication industry defied the financial crisis and kept growing at a stable rate throughout 2008. The report forecasts that the industry will reform deeper and finalize the systematization of its commercial operations this year, the website reported. (07/50/2010 Chinadaily.com.cn)
Integration plan promotes radio, TV and film
Revenue generated from China’s radio and television products are predicted for the first time to hit 200 billion yuan ($29.29 billion), and as domestic box office sales accumulated 3 billion yuan in the first quarter of 2010, the total revenue from China’s film products this year may surpass 10 billion yuan, the Shanghai Securities News reported. Pang Jingjun, deputy director of the development research center with SARFT, said at a press conference that revenue from China’s television advertising and new media would continue to grow amid the financial crisis.
The Report on Development of China’s Radio, Film and Television 2010 issued by the State Administration of Radio, Film and Television (SARFT) on Tuesday said the tri-networks integration plan has promoted the development of radio, film and television industries and new media industries in China even during the financial crisis.
In 2009, the total revenue from China’s radio, film and TV industries reached 195.95 billion yuan, up 17.53 percent from the previous year. Among which, 185.29 billion yuan was generated by radio and TV industries, an increase of 17.06 percent from a year earlier. The revenue included financial subsidies from the government, according to the report. Pang said the film industry revenue surged 26.47 percent year-on-year to reach 10.67 billion yuan and box office sales reached 6.21 billion yuan, up over 25 percent continuously for the sixth year. He also said State-owned traditional media and commercial websites began cooperation, and a standardized pattern where the Internet provides audio-visual programs was established. (19/50/2010 Chinadaily.com.cn)
Time to review code on political advertising
Vice Chairman of the Democratic Party Lau Wai-hing and five young politicians of the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB) coincidentally paid Commercial Radio for a program to give them time to promote their activities. This triggered a debate in Hong Kong as to whether Commercial Radio shall be allowed to broadcast paid political programs. Whether the propaganda advanced by the two was political advertising and whether it would create a disadvantage for political groups without strong financial support are indeed the core issues of the debate.
According to Section 28 of the Radio Code of Practice on Advertising Standards (Code) formulated by the Broadcasting Authority: “No advertisement of a political nature shall be broadcast except with the prior approval of the Broadcasting Authority.” There is, however, a grey area as to the definition of “advertisement of a political nature”. There are three aspects to consider: “an advertisement of a political nature by a political organization”, “an advertisement of non-political nature by a political organization”, and “an advertisement of a political nature by a non-political organization”. The first case is simple. It obviously goes against the Code, but the second and third situations are not as clear. For example, the DAB’s program intended to raise concern for young night drifters is of the second category. The content of the program itself is not political in nature, but the program hosts and sponsor are all members of a political organization.
After this incident, it is time for the government to review the Code. For example, the government should give a clearer definition to the meaning of “political advertisement”. There is also room to review the existing restrictions on political advertisement. As the political system in Hong Kong is opening up, there is stronger need for adverting by political personalities.
The Hong Kong government should not evade the issue or ignore that demand but there must be the precondition that the message shall be transmitted fairly, justly and openly under proper regulation so as to prevent a monopoly of radio or television channels by a very small number of people.
The following issues may be considered in regulating electronic media’s broadcasting of political advertisements and acceptance of political parties’ sponsorship of programs. First, it has to restrict the time for the broadcast (for example, prime-time broadcasting of such advertisements shall not be allowed); second, there shall be a restriction on the length and duration of such broadcasting; third, there shall be a restriction for the percentage and the proportion of political advertising in comparison to all other programing on radio or television stations; fourth, there shall be a standard rate to ensure different parties or people pay the same charges on such programming. Of course, the above are only some issues, among many, for public discussion.
In line with the review of the Code, it is also to be noted that many of the restrictions in the Election Ordinance (EO) are artificially designed to create many unnecessary obstacles for election campaigners. Many parts of the EO discourage the creativity of campaigning. As a result, most campaigns in Hong Kong are boring and stagnant. It is good time now to revisit this question.
The author is a legislator and associate professor of the School of Law, City University. （13-05-2010 www.chinadaily.com.cn）
The future of television seen through rose-colored glasses
Home entertainment manufacturers are hoping that 3D TV will turn into the next consumer bonanza, but analysts and consumers see many drawbacks, reports Timothy Chui.
Competition is heating up as the entertainment industry scrambles to take hold of what it hopes will be the next big consumer boom, “3D”. Not only is cinema heading into three dimensions, so is television. Analysts in the home entertainment industry however are not so certain that the boom will come about, as several factors may make 3D television less than the “big deal”, the industry anticipates. With the 2010 South Africa World Cup coming in June, purveyors of 3D at the cinema and manufacturers of home entertainment equipment hope to garner major profits from the huge worldwide audience for the event. Golden Harvest and Multiplex Cinemas hope to provide the only full 3D coverage of the games available in Hong Kong. The home entertainment industry is trying to keep up, as it gets ready to roll out its latest generation of 3D-ready TV sets as early as this month. The local television rights holder to the World Cup, Cable TV does not plan to distribute a 3D signal. The best local home viewers will get is a simulated effect with the new sets, providing real-time conversion of traditional 2D signals into an approximation of the full three-dimensional experience. It will not equal the picture quality available in theatres, says associate professor Po Lai Man of City University’s department of electronic engineering. Po, speaking at a recent seminar on the latest developments in 3D display at the Hong Kong Electronics Fair, said, “The 2D images can be converted by making use of depth estimations through measuring an image’s focus and relative motions of on-screen objects.” But he added that viewers “should not expect too much”.
After previewing a few soccer matches on a 3D screen in the company of some colleagues, Anthony Fung, professor of popular culture at the Chinese University of Hong Kong, said reactions among the group were mixed and only a few said the new technology actually enhanced their experience. Consumers who choose to buy into the new technology will be making a sizeable investment. One can buy Samsung’s latest 3D televisions in Hong Kong today, at under HK$20,000 for the 40-inch model and a little over HK$40,000 for the 55-inch set. The world’s biggest electronics companies are eager to get into the untested waters of 3D television sets. For example, Samsung already has shipped a handful of 3D sets and plans to ship more. Sony doesn’t intend to ship until June or July. Panasonic has one new model on the market. LG is aiming for a May launch, Vizio comes out in August and Sharp plans to begin shipping its 3D sets by the end of the year. The director of Accupix, which manufactures 3D glasses, Lee Rae Hwan said Samsung and Sony are well ahead of the pack in the push to capture the new market. Both companies plan to ship 2 million units each this year. LG, Panasonic and Vizio plan to ship roughly 1 million units each. Companies have been quick to try to capitalize on the latest 3D reincarnation that started with Disney’s 2005 offering, Chicken Little. The rebirth of the technology is best epitomized by the more than HK$8.58 billion box office for Avatar directed by James Cameron.
The technology for home 3D however is still evolving. There’s one battle going on over 3D glasses for example. Probably one would recall the familiar “Buddy Holly-style” polarized lenses. Those sacrifice image quality but they cost only HK$60. Several manufactures are moving toward the heavier, signal interference prone glasses which use liquid crystal lenses powered by a rechargeable lithium ion battery. To achieve that level of 3D experience however costs consumers about HK$400 per pair. The home entertainment market for 3D is so new that content creators are still hammering out the code to be used to store and transmit 3D media. Critics have zeroed in on the current dearth of content but that’s expected to change in the not too distant future. Rapidly improving conversion technology is expected to unlock vast libraries loaded with content, Po said.
In addition to the current lack of content, observes Fung, the timing for introducing the next big step in display technology at home may be a little premature. He notes the fact that the majority of consumers have only recently upgraded to flat-screen LCD, plasma and LED displays.
Other factors may militate against viewers buying in to 3D television on a broad scale. “It would also take some time for consumers to embrace the new technology since it doesn’t fit well into the viewing habits of today’s consumers,” he said. Most households, he noted, keep the television on while people busy themselves at other things. That will be hard to do when wearing 3D television glasses. “Changing viewing habits among younger consumers may be even more difficult since they are shown to prefer to view content online and through their computers monitors. That will lead to even greater fragmentation of the home television market,” he said. “All in all, older viewers would see the new technology as unnecessary for their needs while most people on the whole would be put off by the higher premiums for an experience which is probably more suited for theaters,” he said. The newest craze toward 3D movies however is being described as, “not a trend but a sustainable, energized and revitalized market,” by the head of Hyundai IT Corporation’s research and development center, Kim Hee-jung. Kim cites studies by the market research firm Insight Media projecting 31 million 3D televisions to be sold by 2012. Another firm, Display Search predicts the 3D market will escalate to some HK$171.6 billion by 2018. Even if home theatre audiences are slow to respond, observes Kopin Kenny Chow, general manager of the China 3D association, there are plenty of avenues to keep the 3D technology buoyant, e.g., military applications, medical sciences and gaming. (China Daily HK Edition 05/21/2010 page2)
Television revolution redux
By Jules Quartly (China Daily)
For many years I’ve been downloading films and TV series, partly because it’s the only way to view the stuff I like and also because I’m not a great fan of TV. My life doesn’t conveniently revolve around broadcast time slots and then there are the ads, which are such a waste of time those responsible should be criminalized for taking years off a person’s life.
TV is like magic when it comes to live broadcasts (news, sports events) but essentially it’s passive. In the old days you had to watch what you were told. Then there was satellite and cable. More choice – but more ads. Now there are settop boxes with Internet connections, TiVo, iTV and movie services. Which are better, but a bit clunky. When I told Chinese colleagues some time ago that I didn’t watch much TV and considered myself a downloader, they looked at me pityingly. And not because downloading much of the media on offer is illegal. “Why don’t you stream?” they said. Why clog up the hard disc’s arteries with media I will never watch again? They had a point and I became a streamer. Then, the government authorities did their annual pruning of “pirate videos” (this time online) and a broad swathe of streaming sites went out of circulation. Now, many of them are back, stronger, taller and more verdant, according to a recent Sohu article.
Sites like Youku and Tudou host foreign and domestic TV series, and increasingly homegrown movies, such as the outstanding The War of Internet Addiction, which attacks censorship from a World of Warcraft point of view. While the State Administration of Radio, Film and Television is working out how to control broadcast and content licensing, the market is growing like weeds in an untended garden.
The latest China Internet Network Information Center figures show there are about 240 million online video watchers in China, which is more than 60 percent of the country’s 384 million Internet users. This is obviously a massive market. It proves to my mind that traditional TV is choking and people like me would prefer to seek out the content we want, when we want. Nothing’s going to stop us, so the authorities better sort it out.
But that’s not the point of this article. No, I want to talk about a revolution in the airwaves. The Web is coming to TV. “The revolution we’re about to go through is the biggest single change in television since it went color,” Intel chief executive Paul Otellini prophesized last week.
He was referring to Google’s annual developer’s conference in San Francisco that opens today, where it is expected the company will announce, with Intel and Sony, the launch of Smart TV. In the immediate future there will be a convergence of TV and computer screens and all those fans of online videos will be migrating back to the TV to watch what they want, when they want, on the Web.
It makes sense. After all, if phones can be connected, why not TVs? It will be so much more fun. Large screen, high definition, smart TV. My eyes are watering at the thought. Bring it on（19-05-2010 www.chinadaily.com.cn）
20 jailed for CCTV tower blaze
Twenty people involved in last year’s deadly Spring Festival fire at the China Central Television (CCTV) headquarters have received jail terms ranging from three to seven years. A statement released Monday by the Beijing No. 2 Intermediate People’s Court, said Xu Wei, former head of construction office of the broadcaster’s new headquarters, was sentenced to seven years, with the other 19 involved receiving three years to six and a half years. A total of 21 people were convicted Monday, but one, Chen Zijun, was exempted from criminal punishment due to his minor role is the blaze, said the statement. The 21 convicted included five CCTV staff: Xu Wei, Deng Jionghui, Hu Debin, Gao Hong and Wang Shirong.
Xu Wei was found to have made the decision alone to stage the fireworks show and arranged others to organize the event from December 2008 until February last year, said the statement. Gao Hong, head of the safety production supervision department under the CCTV new headquarters office, was jailed for four and a half years for failing to halt the fireworks show after being informed of the plan. Three staff from the China State Construction Engineering Corporation and three from the Beijing Urban Construction Group, who were all involved in the construction, were also among those convicted, said the statement. In addition, a warehouse principal named Liu Guilan, in north China’s Hebei Province, received a three-year jail term suspended for three years for storing the fireworks and ignition devices for the display in an unqualified storehouse. The statement gave no titles for the other nine convicted, including Liu Faguo, who got six and a half years for choosing the site for the display and arranging the purchase and transportation of the fireworks. The statement did not give details of the charges against the remaining defendants.
The trial opened in late March. According to the Criminal Law, a person who causes a serious incident while violating the provisions of the control of explosive or inflammable materials can be jailed for up to three years. In especially serious cases, the sentence can range from three to seven years. The illegal fireworks display started the fire that gutted the 30-story building in Beijing’s Central Business District on February 9, 2009. One fireman died and six firemen and two construction workers were injured. The cost of the fire was estimated at more than 160 million yuan ($23.44 million).（10-05-2010 www.xinhuanet.com）
CABLESHOW-Cable warns programmers on rush to Web
Cable TV executives on Tuesday warned the industry against rushing to put their best shows on the Web and other platforms before figuring out business models that won’t cannibalize existing revenues on television.
Top cable executives gathered at the annual Cable Show event here to discuss, among other things, the best way to deal with a proliferation of new Web-based and wireless services which enable their subscribers to access programming without subscribing to their cable operator. “This jump to put long-form content on all these platforms didn’t make business sense and didn’t make consumer sense,” Discovery Communications (DISCA.O) Chief Executive David Zaslav said on a panel with other executives. Zaslav said there had been a “rush in the industry to put quality content on a range of platforms.” “Long form content on all these platforms is diminishing the value of your cable customer,” Zaslav added to applause from an audience of hundreds of cable executives.
Discovery has been a leader in offering short-form versions of its popular shows online but has declined from pushing full-length shows. Viacom (VIAb.N) Chief Executive Phillipe Dauman said his company continues to experiment with new forms of content distribution with partners and said that the “business models will evolve.” Cable programming distributors like Time Warner Cable Inc (TWC.N) and Comcast Corp (CMCSA.O) are keen to continue to have a say in the aggregation of programming on a range of platforms beyond linear TV, such as Apple Inc’s (AAPL.O) iPad tablet computer and Netflix. Patrick Esser, president of privately held Cox Communications, said, “We’re on a journey to move these to other platforms. It’s a change about how we distribute content.”
Cable’s worries have been worsened by infighting between the programmers and the distributors over affiliate fees. In the last six months there have been high-profile programming disputes between Time Warner Cable and News Corp and Cablevision Systems Corp (CVC.N) and Scripps Networks (SNI.N) among others. Programmers fear they will lose viewers if they do not raise affiliate fees to help make more competitive programming. On the other hand, distributors worry about having to pass on higher programming costs to customers and drive these subscribers to seek video entertainment elsewhere. Esser warned his fellow executives against the long-term damage of the disputes to the industry. “If we disrupt our customers’ lives by taking channels away and putting them back on we invite other people into this discussion.”
While executives were positive about the impact of technology on the industry in general they cautioned against rolling out 3-D services in a hurry. Major cable companies have been experimenting with 3-D programming with the hope of catching on to the next big consumer technology trend. Time Warner Cable CEO Glenn Britt said the industry should be patient with consumers’ adoption of technology. “We have to pay attention to the consumer. It can’t be us pushing this; it’s got to come from the consumer.” （11-05-2010 http://www.reuters.com）
Networks unlikely to profit from World Cup
ESPN is counting on that maxim to justify its biggest marketing blitz to date for a single event, hoping to prove that soccer has reached critical mass in the United States — a mass worthy of the monthlong global sports extravaganza. Meanwhile, Univision, with a long track record covering soccer as Spanish-language U.S. rightsholder for the World Cup, already knows it’s true. It will use the event, taking place in South Africa from June 11 to July 11, to make further inroads with marketers who might not have opened their wallets for the broadcaster in the past and generally still pay lower ad rates than do the network’s English-language peers. Both networks say ad revenue around the World Cup has been brisk. But rights fees also are up, and both networks are going all out in terms of production, coverage and marketing. “We embrace this as a mega-event, not just as a sporting event,” says Alina Falcon, president of news and sports at Univision. “It is our biggest commitment yet in terms of resources.”
ESPN is investing more money on promoting the World Cup than it has for any other sporting event in the channel’s 30-year history. Although the rightsholders don’t disclose spending budgets, they might end up making little or no profit, which is not unheard of: NBC lost $223 million on the Winter Olympics. Still, both are betting on continued growth of the U.S. soccer market, which has benefited from more exposure to content than ever before thanks to foreign league coverage on TV and online. The U.S. fan base is rabid and has helped make the country one of the biggest buyers of tickets, according to the U.S. Soccer Federation. “It’s the world’s most important sport on its largest stage,” says Scott Guglielmino, vp programing at ESPN. “You put into that nationalism, people pulling for their country or the country where they have an interest. You play that over a month, and it’s a completely unique story.”
Soccer is the world’s most popular sport — only the Summer Olympics rival it in terms of global TV audience — but it is somewhat less of a spectator sport in the U.S. Soccer lacks the financial and ratings punch of the NFL or Major League Baseball among non-Hispanics. However, Univision’s soccer-crazed young Hispanic demographic has long provided big ratings. The network’s World Cup numbers traditionally are much higher than ESPN/ABC’s, with a 20 household rating for the 2006 final, a 19 in 2002 and a 26 in 1998, according to Nielsen Media Research. ABC earned a 5.7 household rating for the 1998 final on English-language TV; it fell to a 2.5 rating in 2002 before rising to a 7 in 2006. The lower ratings in 2002 can be tied to the tournament being held in South Korea and Japan, more than 12 hours ahead of the U.S. This year’s event will be six hours ahead of New York, the same difference as for the 2006 World Cup in Germany.
Univision is paying about $155 million for this year’s tournament, compared with ESPN’s $100 million for 2010 and 2014. Univision received about $110 million in incremental World Cup-related revenue in 2006 — an estimated $170 million during the tournament’s time frame — after paying about $100 million for rights. After production and marketing costs, however, that slight profit all but vanished, making it a break-even business. This year, the World Cup likely will bring in about $100 million in incremental revenue, Univision CFO Andrew Hobson said Thursday, which would mean a loss when looking at direct Cup financials. For its part, Univision is bullish about this year’s tournament. “We are performing above expectations, and the demand for the World Cup is strong,” ad-sales president David Lawenda says. Lawenda adds that general market advertisers are discovering that the World Cup is a major avenue to reaching the growing Hispanic demo. Anheuser-Busch, Coca-Cola, McDonald’s and Walmart are among those spending big, many with soccer-themed ads, much as they would for the Super Bowl or Academy Awards.
ESPN wants to bring soccer to a wider audience — not only soccer aficionados but also casual sports fans who crave big, emotional marquee events. The network’s promotions in many cases are targeting the latter group.
It also is targeting foreign-born U.S. residents with posters featuring caricatures of national teams in an effort to reach, for example, ethnic Greeks in Queens, or Italians and Germans in big cities.
The World Cup won’t have much in the way of challenges for a sports fan’s attention. There are no Olympics, the NFL season is months away, and basketball and hockey nearly will be over by the time the action begins. Only baseball’s All-Star Game on July 13 is nearby. “The World Cup pretty much has the stage to itself this summer,” says Sam Sussman, senior vp and director at Chicago-based ad buyer Starcom Worldwide.
Other factors are conspiring to make the event a more attractive sell to English-speaking sports fans: The U.S. team is guaranteed three games and maybe more as it has a chance to move beyond the group stage with England, its opening-match opponent June 12. Sussman believes that the South African locale — where it will be winter — also will help. Cooler conditions could promote scoring, which American fans like. Data on ad rates are tightly held by Univision and ESPN, and marketers typically don’t buy single spots. Instead, they often make commitments to soccer governing body FIFA that include jersey or boot sponsorship for national teams, in-game and in-stadium signage and TV ads.
Adidas had a $200 million deal in 2006 that made it the official supplier of game balls and title sponsor of an MVP trophy. Such arrangements make the World Cup hard to compare with, say, the Super Bowl, for which average spot prices typically are publicized. Industry folks are keeping a particularly close eye on ESPN to see whether this year’s World Cup reaps hoped-for benefits.
Miller Tabak analyst David Joyce says the event still could be a loss business for ESPN and ABC, but “it helps broaden their brand to get customers to identify the World Cup more with ESPN.
“I expect them to be increasingly competitive in their bidding for future World Cups as ESPN has been expanding its programing into European markets, and (showing the Cup and other soccer events in even more countries) would be a key rights win to help grab market share,” he says. （07-05-2010 http://www.reuters.com）
Edit by Jackie Fang YIN
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