Chinese Government Finally Enters Online Video Market with State-Owned

The following is my latest post on Digital East Asia.

cntv logoChina’s online space has long been one of rare industries where there is not big state-owned players present – Baidu, Inc. ((ADR) NASDAQ: BIDU), Limited (HKSE: 1688), Tencent Holdings Limited(HKG: 0700(ADR) PINK: TCEHY), etc. are all private companies. People often speculate if and when this will change (just last night I had such a conversation with a friend who works in VC). Well, this has just become true for the online video sector.

China’s state-owned media giant China Central Television (CCTV) has just launched China Network Television (, which is an aggressive foray into the online video space by any measure. Previously, CCTV has been content with offering ad-hoc streaming of important programs on its website and partnering with internet properties such as Sina. CNTV is a dramatic development as it is essentially trying to move all of CCTV’s content online (think Hulu, but 10 times more aggressive).

The site, which will officially launch on Monday, Dec. 28th, is already accessible. At launch, the site offers 5 distinct “channels”:

  1. a 24-hour news channel,
  2. a sports channel,
  3. a general entertainment channel,
  4. a user-generated-content (UGC) channel (think Youtube clone), and
  5. a video-on-demand (VOD) channel.

In addition, CBOX (in Chinese), a software client, is available for download (though right now the link seems to be broken, so I haven’t been able to test it).

The 24 hour news channel and the sports channel (titled “5+”, as CCTV5 is the sports channel under CCTV) require a plug-in to view. 5+ currently only has some ads (it’s 7am Monday as of this writing, so the channel hasn’t officially launched yet), whereas the news channel is currently streaming CCTV News. I think these two channels will offer some forms of original programming going forward, and not just stream TV content. I’m not sure if the plug-in is based on some form of P2P technology (as used by competitors PPLive and PPStream), but at 7am the news channel isn’t streaming that well, so there are some technical issues to resolve. The entertainment channel, the UGC channel and the VOD channel utilize Adobe Flash.

CNTV xiyou logoThe UGC channel, named CNTV Xiyou (grapefruit, I have no idea why it’s named as such…), looks and feels like any other online video site. As can be expected, there isn’t a lot of content right now, but I did see clips from other television stations uploaded – not sure how CNTV will handle piracy, but this will likely be a very sensitive issue due to CNTV’s state-owned background.

cntv bugu logoPersonally I found the VOD channel, CNTV Bugu (cuckoo, again, no idea why it’s titled this), to be the most interesting. The service has two components – a live component and a database of programs. Right now, live streaming of 51 TV channels (CCTV properties and a range of the most popular provincial channels such as Beijing TV) is available. For the database, it seems to be CCTV’s ambition to make all of its programming fully searchable and watchable online, and Bugu is the first step in that direction. The database has a impressive collection already – I just watched the 30-minute news from September 14th. There are also some films, courtesy of CCTV6 (the movie channel), for example All Quiet on the Western Front, though again there could be some copyright issues involved (when CCTV purchased the license for the film, did it also include online broadcasting rights?).

CNTV’s launch has serious implications for the space. It’s an aggressive entry into all the sectors of online video. While UGC sites like Tudou (in Chinese) and Youku (in Chinese) might feel the pain less (CNTV in this regard is just another Youtube clone; there is not differentiation – yet), properties like PPLive (which has recently renamed itself PPTV) and PPStream which heavily rely on traditional TV resources will certainly be strongly challenged. One of CNTV’s stated goals is to make CCTV’s 20 channels fully viewable online, and since CCTV is the monopolistic player in many fields (sports for example – there are few competitors to CCTV5), this will make CNTV the go-to property for a lot of viewers. Of course, a lot depends on the actual execution, but it’s safe to say that the landscape is about to change.


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