News Corp. gains ground in digital media and anti-piracy issues

And other news in Greater China

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BEIJING--Despite his well-publicized inability to get News Corp.’s broadcast channels like Star Movies on Chinese cable systems, due to strict controls on foreign media in the mainland, Chairman-CEO Rupert Murdoch was on hand in Beijing this week to bless a small but significant success in China’s digital media market.

News Corp. has signed a deal with China Mobile, the world’s largest mobile phone service provider with more than 287 million subscribers, to launch a wireless music platform to develop and distribute new original Chinese music to China Mobile’s subscribers. The venture is called [V] Wireless Original Music.

It is the first initiative in a strategic partnership established in June 2006 between China Mobile, News Corp. and its Hong Kong-based Star Group subsidiary, which broadcasts the Channel [V] music channel. The [V] Wireless Original Music invites people--of all ages and from all over the world--to create and upload their own Chinese songs to the web site vgongshe.com.

Visitors can vote for favorites and outstanding songs at the top of the chart will be developed into music videos for broadcast on channels across China including Star's Channel [V] and Xing Kong, which have limited legal distribution in southern China. The writer of the song with the largest number of votes will be awarded the Best Original Music Songwriter Award at the annual Channel [V] Chinese Music Awards.

As part of the partnership, China Mobile will set up a dedicated site branded [V] Wireless Original Music on its WAP platform Monternet, enabling its subscribers to download songs directly to their mobile handsets and vote for their favorite songs.

The launch of [V] Wireless Original Music coincides with the arrival of Jack Gao, Star’s new CEO, China and chief representative of News Corp.’s Beijing office, who started work this week. Previously, he was VP at Autodesk Inc., responsible for its operations in Greater China and India.

While Mr. Murdoch was in Beijing, he has also been talking to possible partners, namely blog companies Bokee and BlogCN, to launch MySpace in China.

Another News Corp. subsidiary, Twentieth Century Fox Home Entertainment, has also gained ground in China. It has signed an agreement with China’s largest video distributor, Zoke Culture Group, to distribute DVDs for the studio giant across Zoke's nationwide distribution network of 20,000 retail points in major cities. The deal was signed on Nov. 13, in Beijing by Mike Dunn, Fox's worldwide president and Guo Zilong, Zoke's president-chairman. The U.S. entertainment giant will begin releasing its first wave of DVD and VCD titles this month, led by "Garfield: A Tale of Two Kitties," "Ice Age: The Meltdown" and "X-Men: The Last Stand."

China is rife with pirated discs, a major source of tension in U.S.-China trade relations. The major reason for the widespread sale of illegal discs in China, which sell for as less than $1, is the disparity between the high cost of legal DVD movies, usually above $20, and the developing country’s low wages. As part of the deal with Zoke, Fox intends to lower the price of movies to make legal products more affordable, and hopefully more attractive, to local consumers.

The alliance follows the recent conclusion of a “100 Day Campaign Against Piracy” convened by ten Chinese ministries and national departments, including the Ministry of Public Security, State Administration of Press and Publication, National Copyright Administration and Ministry of Culture.

"China is a very important component of Fox’s future business and our goal is to preserve the integrity of our movies, while offering Chinese consumers first-rate packaged entertainment that is authentic, affordable and quickly accessible," said Mike Dunn.


P&G will resume SK-II sales in December
GUANGZHOU--Procter & Gamble Corp. will resume sales of the full line of products in its premium skin care range SK-II in Chinese department stores in early December. The company said in a statement that it has adopted a "step-by-step approach" with the brand to regain momentum, earn back consumers' trust and better serve consumers and retail customers.

SK-II, which originated in Japan, has been sold in the mainland for eight years but was pulled from store shelves this fall after allegations of poor product safety from a government agency.

The news led to consumer protests and P&G was forced to offer refunds for the pricey products. Late last month, however, P&G said China's General Administration of Quality Supervision, Inspection and Quarantine and the Ministry of Health in Beijing both confirmed there are no safety problems with the product, and it began to the process of reinstating the brand in China.

“We are delighted to once again be making SK-II available to consumers in mainland China,” said Stevie Wong, general manager for SK-II in Greater China. “We realize that some of our loyal consumers may not be able to purchase SK-II right away, and we thank them in advance for their patience and support.”


China will censor "vulgar" content on TV
BEIJING--China will censor content on television deemed “vulgar” by the State Administration of Radio, Film and Television (SARFT), including scenes about extramarital sex, violence and pornography, according to the country’s government-run newspaper, China Daily. The major targets of the new restrictions will be entertainment programs, talk shows and dramas in local dialects.


Home-grown service brands outscore international rivals
HONG KONG--Home-grown Hong Kong service brands are more admired in the Chinese territory than their international counterparts according to a survey on 45 major service brands.

Nine out of the top ten most admired brands in the survey were the Ocean Park theme park, The Peninsula, Cathay Pacific, Shangri-La, Hang Seng Bank, HSBC, City'super, Lane Crawford and the Parknshop grocery store chain.

The only international brand was the Japanese department store Sogo. While renowned international brands such as Starbucks, Four Seasons, Seibu (another Japanese department store), Manulife and Singapore Airlines also fared well, they were out-ranked by local brands, according to a survey conducted by brand management consultancy The Ingram Brand Company, and the global Aegis Group market research company Synovate.

“In a city that continues to refashion itself as a key regional and global service centre, it is encouraging to see so many of Hong Kong's leading service players performing so well. Perhaps we should not be surprised as Ocean Park, The Peninsula and Cathay Pacific, for example, are all highly awarded organizations on the international stage,” said James Stuart, Ingram's managing partner in Hong Kong.

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