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Fri, Nov 26, 2004 - Page 12 News List

Sony in deal to make Chinese-language TV programs

VENTURE Sony has bought a minority stake in a unit of China Film in a venture to produce sitcoms, drama series and movies in the world's biggest TV market

BLOOMBERG

Sony Corp's Sony Pictures Television International formed a television production venture with China Film Group (中國電影集團), challenging rivals such as Viacom Inc for a foothold as the nation opens its TV market to foreign investors.

The venture with China Film's Hua Long Film Digital Production Co (華龍電影數位制作) unit will make Chinese-language programs including sitcoms, drama series and movies, Los Angeles-based Sony Pictures said in a PR Newswire statement. The Beijing-based venture is the first to receive Chinese government approval, the statement said.

China last week issued rules allowing foreigners to take minority stakes in TV production companies for the first time, widening access to the world's biggest TV market by viewers.

Viacom, Walt Disney Co and News Corp are among foreign companies that have set up, or are in talks to form, TV ventures in the nation.

China's government is betting that putting television on a more commercial footing will generate revenue, taxes and jobs.

ad sales

China's TV advertising sales will surge a third to US$24 billion this year based on published rates, after jumping 45 percent last year, New York-based Nielsen Media Research forecasts.

Sony, which owns Columbia TriStar Motion Pictures and is buying the Metro-Goldwyn-Mayer Inc studio, already cooperates with China Film, the nation's only authorized importer of foreign movies. The companies have a "long history" of co-producing and distributing Chinese films, China Film Chairman Yang Buting (楊步亭) said in the statement.

TV production ventures must use "China themes" in two-thirds of programs, the broadcasting regulator said last week.

The requirement ensures companies that include investors from other countries produce original content rather than adapt overseas programs for mainland audiences. Investment in news and current affairs programming and in TV stations remains off-limits for overseas media companies, the regulator said.

Sony said the venture is part of its efforts to increase TV production in Asia. The company will produce programs this year in India, Japan, Indonesia, Thailand and Taiwan.

China Film will hold a majority stake in the venture, named Huaso, Sony said, without giving a figure. Under the rules issued last week by the State Administration of Radio, Film and Television, foreign investors can hold a maximum 49 percent.

China Film, which has 3,200 employees, operates businesses including a film studio, a movie channel on state broadcaster China Central Television's network and a cinema chain.

The venture already has programs under development, including light entertainment and TV movies, for distribution inside and outside of China, Sony said.

digital conversion

China needs varied content and new channels as it plans to convert 100 million urban households to digital TV by 2008, said Wang Xiaojie, a director-general at the country's broadcasting regulator.

Viacom, the third-largest US media company, in March became the first overseas investor to take a stake in a Chinese TV production company, forming a venture with Shanghai Media Group to make and sell children's programs.

News Corp, which already broadcasts to parts of China through its Star TV unit and 38 percent-owned Phoenix Satellite Television Holdings Ltd, is negotiating with potential production partners and may announce a deal within six months, Jamie Davis, president of News Corp China, said last week.

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