Bertelsmann Earmarks China as ‘Key Strategic Region’, Plans Rapid TV Expansion

29 January 2002

Not to be outdone by Rupert Murdoch or AOL Time Warner, German media mammoth Bertelsmann has received “binding permission” from the Chinese government to produce indigenous TV content.

The deal, a fruit of a recent visit to Beijing by Bertelsmann chief executive Thomas Middlehof, will lead the group to “massively increase” its presence in what many see as the globe’s prime advertising and media growth market.

Middlehof has committed himself to hike Asia’s contribution to total group sales over the next twelve years from its current level of 2.5% to 10% – a feat that can be achieved only via China given that rivals already control all other major TV markets in the region.

The Bertelsmann beachhead will be established with local partners in a joint production of the successful game show The Price is Right, scheduled to air in Shanghai in July. It will be co-produced by Bertelsmann unit RTL Group with Sino Universal Media and Oriental TV.

Also on the stocks is a programming deal with Hong-Kong based Sun Satellite TV, reflecting the type of TV fodder preferred by China’s rulers: non-political,family-oriented and aimed directly at advertisers. Enthuses chief executive officer at Sun TV, Bruno Wu: “We see great potential in a cooperation with Bertelsmann.”

Around 93% of Chinese households own a TV set and the nation has some 1,200 local channels – all seeking modern content, including Western-originated fare. Advertising volume currently totals around E2.4 billion ($2.067 billion) and, according to Xinghua Online, is set to soar 13% this year.

News source: Handelsblatt (Germany)