BEIJING (AdAgeChina.com) -- Discovery Communications has turned to the internet, not television, to expand its business in mainland China.
The U.S. media company's Discovery Networks Asia-Pacific division has launched a Chinese-language web site, discovery.baidu.com, through a partnership with the Chinese search engine giant Baidu.com.
Discovery is best-known for its broadcast operations, such as Discovery Channel, Learning Channel, Animal Planet, Discovery Science Channel and Planet Green Channel. Those channels have wide distribution in many parts of Asia, but not in China, where 24-hour distribution of foreign channels is limited to hotels catering to western visitors and housing compounds for foreigners.
Discovery programming also runs in short blocks on local cable channels in a handful of major Chinese cities like Beijing and Shanghai, but the U.S. company's viewership is limited to around 21 million people in mainland China, said Singapore-based Tom Keaveny, exec VP and managing director, Discovery Networks Asia-Pacific.
Discovery's decision to expand online, rather than via television, isn't just about avoiding China's restrictive broadcast regulators, Mr. Keaveny said.
"We're looking at it as a way to create a deeper presence in the marketplace with our content. A lot of companies see themselves as TV, print or online media. We look at ourselves as all media. Working with Baidu is a way to use our web content from around the world."
Baidu, known as the "Google of China," is the largest Chinese web site and Chinese search engine in the world. During the second quarter of this year, Baidu earned $160.7 million in total revenues from 203,000 active online marketing customers, a 36.7% increase from total revenues generated during the same period in 2008.
The company controlled 61.6% of China's search market in the second quarter of this year, according to Analysys International. Google, the No. 2 player, trails with a 29% market share.
Discovery's web presence also reflects the size and importance of the internet, the first stop for young adults in China looking for entertainment and information. China's internet market surpassed the total population of the U.S. by the end of June 2009. China now has 338 million web users, according to the China Internet Network Information Center, about 25.5% of China's total population.
Baidu will build, operate and update the web site, and Discovery will be the exclusive content provider for the site, which will be customized and translated for the Chinese market. Like its other sites around the world, the Chinese platform will carry nonfiction content about science and nature. br />
The site will be supported by advertising although there were no marketers on the site for the July 28 launch. Baidu and Discovery will share responsibility and revenue from third-party advertising sales.
"There's no advertising yet, the site just launched, but there will absolutely be advertising. We're still looking at other sources of revenue," Mr. Keaveny said. "For now, it's just important to us that the site has launched. China is one of the fastest- growing markets in the world and we need to be involved in it."
Discovery has also created content for its global sites inside China through its First Time Filmmaker project. In 2007, it produced six short films that presented a unique view of past Olympic host cities through the eyes of Chinese filmmakers in a partnership with Visa International. The films aired on an entertainment section of the Chinese portal Sina.com as well as on Visa's Chinese consumer site, www.visazone.com.cn.
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