When media mogul Mr Rupert Murdoch bought the pan-Asia satellite television network Star TV in 1991 from its Hong Kong owner HutchVision, he had one eye on the China market. Beaming signals easily accessible to anyone with a big enough satellite dish, the network promised advertisers access to the homes of 1.2 billion Chinese.
Other satellite networks shared the same dream. International networks such as CNN, Discovery and ESPN, whose broadcast footprints cover much of the mainland, all have ambitious China projects. One of the most aggressive players was CIM, the Hong Kong-based media group which owned the local broadsheet Ming Pao. CIM spent US$40m to launch CTN ? a Mandarin-language, two-channel 24-hour satellite television network.
For a while the market looked good. Television was spreading rapidly in China, with 837 terrestrial networks and over 3,000 cable networks at end-1995. Cable networks, in particular, needed lots of programming to fill their 20-30 channels. Satellite dishes appeared everywhere in China, receiving signals from free-to-air broadcasters. Star TV was especially popular, thanks to its Mandarin-language channel featuring soap operas and entertainment shows. By 1993 its viewers grew to 30 million, according to one estimate. Murdoch was so carried away with the achievement that he predicted satellite television would spell the end of totalitarian regimes worldwide.
It was a premature forecast. Murdoch's comment alerted Beijing to the potential threat posed by foreign broadcasters to its political stability. The authorities moved quickly to exclude uncensored foreign broadcast signals.
Today, Star TV is accessible only to a few designated areas, such as tourist hotels and apartments and offices where foreigners live. CTN, now owned by Taiwan interests, has almost given up the mainland market, concentrating instead on Taiwan. "Our penetration in China is close to zero," admits a CTN executive. The limited foreign programming Chinese viewers see is often censored, cutting out parts which the authorities deem inappropriate. "What finally comes out of the censoring machine is usually boring," says a Hong Kong-based manager for an international news broadcaster. The foreign programme is sometimes edited beyond recognition, with the logo of the foreign broadcaster cut out and the content edited and mixed with local footage.
How has Beijing managed to counter the signals of an estimated 330 foreign satellite broadcasters whose footprints cover China? First, there are tough regulations. In October 1993, the State Council issued 'Decree 129' to restrict the ownership of satellite dishes. Overnight, many dishes disappeared. A year later, Beijing announced new, tougher regulations confirming again that no private individual or foreign company could invest in or run cable networks. Plans of a few foreign media companies to take a stake in a local Chinese network were suspended indefinitely.
Programmes for airtime
Then, there are the gates and the gatekeepers. Beijing restricts the importation of foreign programmes to about 2,200 titles a year. In June last year, Beijing further said airing of foreign programmes was to be restricted to at most 40 minutes during the prime hours of 18:00 to 22:00 every day. Importation of foreign programmes was also to be done only via one company, the China International Television Corporation, a subsidiary of the national broadcaster China Central Television.
Programmes imported have to be cleared by the Ministry of Radio, Film and Television, the watchdog of the industry. "There is no telling what the censors like or don't like," says Wing Chung, an executive of Animation Limited, a Hong Kong-based media company which has sold animation and Japanese-language programmes to China. Even seemingly benign cartoons are not left alone, a Beijing lately has turned more attention to improper content, such as violence any sex, contained in such imports.
Aside from regulatory constraints, financial ones also pose formidable hurdles to foreign broadcasters wanting to sell their products in China. Smaller net works do not have the foreign exchange to buy foreign programmes. Bigger stations, thigh richer, are used to discounted 'friendship' prices offered b: foreign firms anxious to sacrifice immediate gains for potential long-term re turns. "Chinese networks are not use (to paying much cash to buy foreign programmes as they could get them very easily and cheaply from over-zealous suppliers," says a US media executive. For most foreign programmes, the average price Chinese networks pay is US$2,000-3,000 for a half-hour episode.
Search for self-sufficiency
One common form of cooperation between foreign programme suppliers and Chinese television stations is barter. In return for providing a programme fret to a Chinese network, the supplier get segments of airtime which it can sell to advertisers. CNBC, the US news and entertainment channel, has such an arrangement with Guangzhou Television and Shanghai Television. MTV, the music channel, provides one hours encrypted programming to 23 Chinese cable networks, in exchange for both advertising time and licensing fees Many are cynical about profitability claims. "I have yet to meet someone who has made money out of such an arrangement," says one source.
With a limited supply of foreign programming, Chinese networks have to rely on themselves to make a high proportion of programmes. But their production capacity is limited. Even cash-rich CCTV could only produce less than half of all its programmes; the rest are old programmes or productions of other networks. Things are made more difficult by the fact that production, especially television drama, is subject to strict
official scrutiny. Before filming, the script has to be approved by the ministry and then cleared before completion.
As a result, the number of television dramas completed each year is way short of the intense demand for programming from thousands of channels. In 1994, only 792 separate television dramas consisting of a total of 6,212 episodes were produced. China's long-term solution to the deficiency is to pool national programmes and distribute them nationwide via one big, mixed satellite and cable network. CCTV, the eight-channel national broadcaster, and 18 major terrestrial stations are already beaming their signals nationwide, allowing all Chinese stations to download their programmes for rebroadcast.
With such an abundant supply of Chinese programming from the sky, the average 20-channel cable network will easily be able to fill up over half of its airtime.
Another solution is to allow networks to develop pay-television, which will consist of encrypted programmes that require viewers to pay an extra fee before the signals can be accessible. Television networks now make money mainly through advertising; subscriber fees are minuscule, an average of Yn8-12 (US$0.96-1.45) a month for most cable networks. Pay-television will broaden the revenue base of networks and provide more money to produce better programmes. CCTV already has a pay-movie channel, which charges subscribers Yn2 a month. Other big local networks are likely to follow suit, although encryption technology has to be improved first in China.
China may have grandiose plans to be self-sufficient in television programming, but foreign shows will continue to appear. Networks anxious to boost their ratings will find ways to import quality products, but the watchful eye of the censors will never be far away.