China will invest billions in a media company

In the next few years, China plans to invest billions of dollars in the development of media and entertainment companies that, as they hope in the country's government, will be able to compete with global giants, Bfm.ru business portal writes.

The ambitious plan prepared by the Chinese State Council provides for the creation of companies in the field of media and entertainment, marketably oriented and with a smaller share of state support. China seeks to consolidate the media industry in the hands of several companies like Bloomberg, Time Warner and Viacom.

“In the highest government circles, there is, apparently, an understanding that it is necessary to develop a media machine, according to the growing influence and status of China,” comments in an interview with The New York Times, Jim Lori, a former ABC News correspondent, who teaches at the University of Honcokong.

Last week, Beijing said that state groups will be reorganized to make external financing and companies could live on "self -support, instead of parasites, to be attached to state structures." Companies will receive greater freedom in attracting funding and in the production of a greater spectrum of entertainment and cultural content for distribution within the country and abroad.

Although yet China has not prepared a detailed plan, it can be assumed that the exception will probably be information programs that are under the control of the Communist Party. China also modernizes in state information services with an eye on foreign -language publications, information tapes and television programs to cover the reader and audience abroad.

Investments on the part of media companies, if they follow, will probably be carried out through partner projects, which is even under government control today.

“This is a good moment for Western companies to come to the market and find partners,” says Zhu May, head of Linden Consulting. According to her, the new policy seems to encourage cooperation in the form of joint enterprises, for example, such as the Beijing State Company Geehua Cultural Development Group and the American Live Nation, specializing in the organization of concerts and performances.

Among the former, as a result of the new state policy, Shanghai Media Group (SMG), one of the largest state media conclicts, will win. In August, the company received government permission to reorganize and place shares in the open market. Last year, SMG received almost $ 1 billion revenue and $ 100 million. The company cooperates with News Corporation, Viacom and CNBC. Its structure has a number of profitable television units, including an animated channel, a portfolio of programs about fashion and lifestyle, as well as radio, newspaper, magazine and film studio.

Analysts believe that some Chinese large media companies flourish, film production and other entertainment directions show rapid growth, as wealthy Chinese consumers seek to diversify their leisure time.