Movie Channels Planned, But Will SARFT Let Them Compete?
BEIJING --- According to industry sources, a number of film studios that have been given permission by SARFT to launch movie channels (please refer to 'Three More Channels on Their Way') are complaining to the broadcasting industry regulator that their efforts are being hampered by the near lock CCTV's movie channel, CCTV-6, has on the country's film output.
The studios, Changchun Film Studio, Xi'An Film Studio as well as the Shanghai Film Studio have all applied and received permission to launch film channels, and while they seem to have put the cart before the horse, they now realize that they don't have the right to air a large portion of the films they have produced.
A report in the Nanfang Daily issued at the end of this month notes that CCTV-6 was granted the right to air 61 percent of China's movie output when it was established in 1996. However, according to Wu Yakang, Vice Director of the CCTV-6 Acquisitions Department, this figure is wrong. Mr. Wu notes that the real figure is actually closer to "100 percent."
Regulatory confusion aside, in either case, the policy amounts to a serious restriction on the ability of any new film channel to fill its programming slots.
The rule was initially put in place to insure that CCTV-6 would be able to fill its programming roster without having to turn to foreign sources for a large portion of its content.
This has left potential studios with little in the way of content that they can air on channels they hope to launch, even if they produced the content themselves.
CCTV-6 is the state broadcaster's number two money earner in terms of advertising revenue, second only to the main channel CCTV-1. Last year ad revenue for CCTV-6 reached more than RMB400 million (US$48 million) with cable operators around the country contributing an additional RMB10 million (US$1.2 million) to the bottom line for the right to carry the channel.
Instead of allowing the various channels to compete with movie production companies and rights owners to purchase the films and develop the domestic film market, SARFT has instead chosen to further legislate the market.
In order to resolve the problem, SARFT issued new policy guidelines on November 25, concerning how the country's potential movie channels can operate.
According to the new policy, the new movie channels will be allowed to broadcast TV dramas.
The previous policy for airing TV dramas on a film channel (at that time CCTV-6 was the only domestic film channel in China) was that the dramas could be aired, but that they were restricted to 8 episodes or less, and only 2 episodes per day. Additionally, only 25 percent of all content could be obtained from foreign sources nor aired in prime time: as is the case for all Chinese channels.
Due to these restrictions, over the years CCTV-6 has rarely broadcast television dramas.
CCTV-6's policy on TV dramas and foreign content will remain unchanged.
The new policy for the yet to be launched channels only is that dramas must not exceed more than 45 percent of the amount of movies airing on the channel and must not be aired during prime time. Additionally, the new movie channels will be allowed to carry foreign movies for one third of their airtime.
This isn’t exactly a perfect solution. The whole point of granting the film studios the license to launch pay-TV channels in the first place was that they would be able to draw on their film expertise, as well as catalogues to launch specialized movie channels. Additionally, pay-TV channels are able to charge extra for content usually because they are offering a specialized choice of programming rather then comprehensive fare. SARFT is now telling these film studios that their compensation for having to compete with a channel that has the right to over half the country's film output is that they can offer a variety of programming, just like each and every one of the China's provincial super-stations (none of which cost extra).
A better solution would have simply been to allow the new movie channels to buy, swap and/or deal amongst themselves or other film producers and leave it up to the market to decide. However, once again, SARFT has indicated that when it comes to CCTV, market based solutions do not apply.