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Digital TV Provides Novel Business Opportunities

China's TV and radio industry should grasp opportunities in the promotion of digital TV (DTV) and transform itself into a modern information provider, instead of simply acting as broadcast media, said a top TV and radio industry policymaker Monday in Beijing.

"The promotion of DTV has offered us unprecedented opportunities as well as challenges for the TV and radio industry, and it will be a paramount job for us," said Zhang Haitao, vice-director of the State Administration of Radio, Film and Television.

He made the remarks at the opening of the 2004 China Cable, Broadcasting and Network Exhibition (CCBN) Monday in Beijing, which will last from Monday to Thursday in Beijing.

He urged the TV and radio industry to transform from a traditional industry to modern media, and transform TV sets into multimedia information terminals with the deployment of digital TVs across the country.

Zhang pointed out that while TV and radio have only provided public broadcasting services and were a one-way service before, the industry should offer professional and tailored information and interactive broadcasting options to consumers.

It is believed the transformation will help TV and radio operators solve or ease difficulties and challenges in the industry.

On one hand, China already has more than 100 million cable TV subscribers and 300 million TV sets, and the potential for subscriber growth is becoming more and more difficult.

At the same time, Chinese TV stations, which rely on advertising, may also reach a bottleneck in seeking out more advertising revenue.

But subscription fees only accounted for about 15 percent of the total incomes of TV and radio stations and network operators.

What is even more important, network operators at the county level, which are responsible for collecting subscription fees and programme reception for all channels, only got 7.8 percent of the country's total TV and radio advertising incomes in 2002. These operators have great difficulty developing further, owing to a lack of financing.

At the same time, the State and provincial TV and radio media garnered more than 60 per cent of that revenue.

Besides internal challenges, telecom operators are also penetrating into the TV broadcasting area.

Some telecom operators started their Internet protocol TV broadcasting based on telecom networks, which have attracted some TV station subscribers.

With the transformation from a purely public broadcasting platform to an information-providing platform, subscription fees will play a more important role for TV and radio operators.

Qingdao, a coastal city in East China's Shandong Province and a pioneer in the promotion of DTV in China, is expected to see revenues more than double, when all 600,000 households begin to subscribe to digital TV channels.

On the other hand, TV and radio network operators and content providers can also tap into providing information for subscribers, which is dominated by telecom operators mainly in the form of the Internet and has huge potential.

There were only about 79 million Internet users in China by the end of last year.

Chinese TV channels have about 1 million hours of programing every year, so the TV and radio industry can play an important role in providing information.

Zhang urged TV and radio stations to open their content to different kinds of technology, including mobile phones and the Internet.

At the same time, TV and radio network operators should use their networks to transmit the kinds of information that people want.

Besides digital TV and radio programes, subscribers in Qingdao can also get access to the latest government policies and announcements, ticket information, weather forecasts and even restaurant information, whenever they need.

(China Daily March 23, 2004)

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