Tag Archives: Dreamworks Animation

DreamWorks Finds Home In Shanghai

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DreamWorks starts work on Shanghai complex

A growing love affair between Hollywood and Shanghai has taken a major step forward, with the formal ground-breaking for a $2.4 billion entertainment complex being co-developed by US giant DreamWorks Animation (NYSE: DWA) and the city’s leading broadcaster. As a longtime industry watcher, I’m most encouraged that this project is actually moving forward, even if the latest price tag is a bit lower than the figure given when the deal was first announced nearly 2 years ago. Over the years I’ve seen too many cases where big new Sino-foreign projects have been announced with big fanfare, only to later die quiet deaths due to failure to get necessary approvals and financing. Read Full Post…

News Digest: March 21, 2014

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The following press releases and media reports about Chinese companies were carried on March 21. To view a full article or story, click on the link next to the headline.
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  • DreamWorks Animation (NYSE: DWA) Unveils $2.4 Bln Shanghai Complex (English article)
  • New JD.com IPO Filing Shows Big Drop In 2013 Net Loss (Chinese article)
  • China Mobile (HKEx: 941) Reports Full-Year 2013 Results (HKEx announcement)
  • Alibaba Invests $215 Mln In Real-Time News App Tango (Chinese article)
  • Trina (NYSE: TSL) Gets Favorable Arbitration Award, Adjusts Q4 Results (PRNewswire)
  • Latest calendar for Q4 earnings reports (Earnings calendar)

Hollywood Vision Drives DreamWorks, Wanda’s Wang

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Oriental DreamWorks boosts China plans

DreamWorks Animation (NYSE: DWA) is dropping the “animation” part of its name in its year-old China joint venture, with word of a major new expansion that underscores the Chinese film market’s growing clout. Word of the expansion comes as Wang Jianlin, China’s newly named richest man, also makes a big bet on Hollywood, with his multiple investments in movie theaters and related technology via has Wanda Group empire. DreamWorks and Wang are both chasing a Chinese film market that is growing at breakneck pack, and is now the world’s second largest after only the US. DreamWorks is also setting its sights on China’s rapidly transforming TV market, where the Internet and other new delivery channels look set to shake up the traditionally slow-moving sector. Read Full Post…

Murdoch Divorce: Done With China?

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Murdoch divorce spotlights News Corp’s China reversal

It’s been relatively quiet in China these last few days due to the Dragon Boat holiday, so I thought I’d start the new week with a look at Rupert Murdoch’s ongoing divorce with Wendi Deng and what it might mean for his flagship New Corp (Nasdaq: NWSA) in China. Many believe that Deng, a China native, was one of the main forces behind Murdoch’s previous bullishness on China, leading News Corp aggressively try to develop the market in the decade from 2000 to 2010. But the company has sharply reversed its China approach over the last 3 years, perhaps reflecting the deteriorating marriage between Murdoch and Deng. Read Full Post…

Hollywood-China Love Affair In Chengdu Spotlight

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Hollywood execs flock to Chengdu

Many of the usual global CEOs are in China this week for the annual Fortune Global Forum in the interior city of Chengdu, but what’s really interesting this year is the presence of many big Hollywood executives. I use the word “interesting” instead of “surprising”, because the presence of top executives from names like DreamWorks Animation (Nasdaq: DWA) and Time Warner (NYSE: TWX) isn’t really that unexpected considering the sudden love affair between China and Hollywood that’s developed rather rapidly over the last year and a half. Even the music industry is finally starting to believe in the huge potential of the China market, with the head of the US-based Recording Academy, organizer of the Grammy Awards, also attending the event in Chengdu. Read Full Post…

China Telecom, Unicom Rev Up IPTV 电信、联通大举进军IPTV市场

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China’s 2 main fixed-line broadband carriers, China Telecom (HKEx: 728; NYSE: CHA) and China Unicom (HKEx: 762; NYSE: CHU), are revving up for a big push into the television market, in what looks like a smart play for a product area that may finally be mature enough to find an audience. My main concern for both of these companies lies in execution, especially for Unicom, which has shown a poor record for implementing new businesses due to organizational dysfunction at the management level. But let’s come back to that issue later, and focus first on the bigger picture that has China Telecom and Unicom putting out tenders for a combined 6.2 million set-top boxes since August as part of their drive to install their IPTV service in millions of Chinese homes. (Chinese article) That number by itself isn’t all too large, but it does seem to indicate that both companies could quickly order more boxes if they find strong demand for their product.

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SARFT Comments: Media Clampdown Coming? 中国传媒业对外开放要放缓？

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I’ve been writing about China’s media industry long enough now to know that a blossoming love affair with Hollywood might be too much too quickly, and new comments from the TV and film regulator appear to hint that a crackdown or at least a slowdown could be looming for this fast emerging relationship. If it comes, such a crackdown would hardly be a new thing, as China has twice before signaled it was preparing to open its media to foreign investment, only to quickly slam on the brakes after the big foreign players got too aggressive.

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HNA Goes to Hollywood 海航走向好莱坞

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The huge potential of China’s box office is back in the spotlight again today, with word that US technology company RealD (NYSE: RLD) will install its 3D technology on a major new theater chain with up to 500 screens being set up by a unit of HNA Group, one of China’s more entrepreneurial business groups. (company announcement) The announcement by HNA Vigor Film Investment comes less than 2 weeks after China’s largest movie theater operator, Wanda Group, announced it will buy AMC Entertainment, the second largest US movie theater operator, in a landmark plan that also includes major facility upgrades. (previous post) All this shows how much potential these companies see in China’s movie market, now the world’s second largest, and also underscores their determination to take advantage of a newly relaxed quota for the import of foreign films that now command the big majority of the country’s fast growing box office. Let’s take a look at this latest news, which has HNA Group getting into the movie theater business with a big move that will make it one of China’s top movie theater operators, behind Wanda’s 730 screens in 86 movie theaters. Equally important, the installation of 3D technology in its new theaters means that HNA will be eligible to show films under China’s newly expanded quota for imported foreign movies. After limiting the annual import of foreign films to 20 for many years, China recently raised the figure by allowing in additional 14 movies in high-tech formats like 3D. That could mean a 40 percent increase in box office sales, as foreign films currently dominate a sector that generated more than $2 billion last year and whose sales could top $5 billion by 2015 as more affluent Chinese are willing to pay relatively expensive ticket prices to see big-budget films. The domestic film-making business has also gotten a lift in recent months, with global animation leaders Disney (NYSE: DIS) and DreamWorks Animation (NYSE: DWA) both setting up joint venture animation studios in China earlier this year. (previous post) Look for this trend to continue, with movie theaters quickly multiplying in China’s biggest cities to meet the growing demand from affluent Chinese eager to see a growing number of top-notch films coming into the country. That should play well not only for the theater operators and movie makers, but also technology and equipment makers like RealD and Imax (NYSE: IMAX).

Bottom line: Real ID’s tie-up to install 3D technology in HNA Group’s new theater chain marks the latest step the recent boom for China’s movie industry.

Related postings 相关文章:

◙ Wanda’s AMC Buy: The Show Isn’t Over Yet 万达并购美国AMC影院：表演还未结束

◙ News Corp Makes New Play for China 新闻集团入股博纳影业集团

◙ Disney, Tencent Tie-Up to Animate China 迪斯尼、腾讯合作研发动漫

 

Welcome to the US Dollhouse, China Mobile 中移动和万达进军美国料将失败

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There are several interesting developments today on big-name Chinese firms moving into the US, highlighting both the opportunities but also the risks for increasingly assertive Chinese names looking to expand into a market that is at once the world’s largest but also highly suspicious of China. Leading the news is dominant wireless carrier China Mobile (HKEx: 941; NYSE: CHL), whose US expansion aspirations are reportedly running into trouble over familiar security concerns. (English article) That report is followed by another one saying Wanda Group, a real estate developer and owner of China’s largest movie theater chain, is in talks to buy some or all of AMC, operator of the second largest US movie theater chain. (English article) And last but not least, long-frustrated telecoms equipment maker Huawei appears to have found a new backdoor into the US through a new tie-up with local company Synnex (NYSE: SNX) to sell its enterprise products in the world’s biggest market. (English article) Let’s look at the China Mobile and Wanda-AMC developments first, as they’re certainly the newest and each provides an interesting challenge that many will be watching in the months ahead. US media are reporting that US national security officials, concerned about the potential for cyber-spying, may deny China Mobile’s recent request to provide mobile service between the US and China and to build facilities in the US. Their main concern is that China Mobile could use the US presence to gain access to local infrastructure that could then be used for spying and to steal intellectual property. This particular concern has become a popular refrain for Chinese telecoms firms trying to enter the US, with both Huawei and rival ZTE (HKEx: 763; Shenzhen 000063) both being denied access to the market numerous times due to similar concerns over the last year. Whereas Huawei and ZTE have both made significant efforts to improve their US images and ease spying concerns, I suspect that China Mobile has done little or nothing in this regard and for that reason its request is very likely to be vetoed. Meantime, other US media reports say that Wanda is talking with AMC’s private equity owners about buying some or all of the US theater chain, in discussions that began a year ago but have become more serious since then. Anything involving Chinese ownership in the US media space is also likely to be sensitive, despite China’s recent opening of its own media sector by allowing big names like Disney (NYSE: DIS) and DreamWorks Animation (NYSE: DWA) to form new animation joint ventures. Accordingly, I would also give this deal a good chance of failure, higher than 50 percent, both due to such sensitivities and also Wanda’s inexperience at this kind of overseas M&A. Lastly there’s Huawei, which is the most experienced in the US after a number of high-profile failed attempts to enter the market in the last 2 years. I quite like this deal with Synnex, which will see the US company sell Huawei routers and switches to US businesses for use in their internal networks, putting it in direct competition with Cisco (Nasdaq: CSCO). These kinds of smaller sales are much less likely to attract controversy than Huawei’s previous efforts to build bigger mobile networks in the US, and thus could actually succeed and give Huawei its first chance to make a serious inroads to the elusive market.

Bottom line: New efforts by China Mobile to enter the US and a Chinese real estate firm to buy US theater operator AMC are likely to fail due to sensitivities, while a new Huawei initiative could succeed.

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◙ Albaba Hires Big Gun in US Image Drive 阿里巴巴重金聘请美国前高官 启动形象改善工程

◙ Beijing Help Undermines Huawei Image Drive 中国商务部替华为出面或适得其反

◙ Huawei-Motorola Rumors Look Logical 华为收购摩托罗拉手机业务传言看似合情合理

Bona Opens New China Back Door 博纳欲与美国同行合拍电影 中国同好莱坞恋情升温

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The growing new love affair between Hollywood and China is taking yet another step forward, with news that New York-listed movie maker Bona Film (Nasdaq: BONA) is in talks with several major US studios to co-produce films for the China market. (Chinese article) In fact, such co-productions aren’t completely new, and many of the other studios have used them in recent years to circumvent a strict quota system that limits the number of foreign films that can be imported to China each year. But Bona’s plan looks particularly aggressive, presenting a potentially interesting proposition for foreign investors looking to buy into the China film story. According to the reports, Bona is talking with a number of major studios, including 20th Century Fox, Universal, Sony Pictures (Tokyo: 6753) and Paramount (NYSE: VIAb) about co-producing movies for the Chinese market. Furthermore, the company’s chief executive says his ultimate goal is to make 2 such co-productions a year. Such a large number would mark a big opening into China for the foreign studios, which until recently were only allowed to collectively export 20 of their films each year into China, now the world’s second largest movie market. Beijing recently increased the total by saying it would allow another 13 movies into the market each year using high-tech formats like 3D. Still, the appetite and potential for high-quality films in China is clearly capturing Hollywood’s attention, leading to a recent flurry of moves into China by the major studios. One of those moves, in fact, saw 20th Century Fox’s parent News Corp (Nasdaq: NWSA) take a 20 percent stake in Bona Film itself last month (previous post); accordingly, I wouldn’t be surprised if 20th Century Fox ends up signing the first co-production deal with Bona in this new round of tie-up talks. Bona’s talks come as other major studios are making their own new moves into China, amid increasing signs that Beijing wants to open the industry to more outside investment. Disney (NYSE: DIS) and DreamWorks Animation (NYSE: DWA) both announced new animation joint ventures in China earlier this year (previous post); and HNA Group and Wanda Group have both discussed major new moves to open and expand their domestic theater operations to accommodate the expected big influx of Hollywood-quality movies. (previous post) Another name to watch could be Huayi Brothers (Shenzhen: 300027), one of China’s other major privately held film studios with foreign experience, though that company has tended to focus more on co-productions with other Asian firms. Either way, these foreign-focused Chinese studios could make an interesting investment play into the market as it prepares for major expansion, with the potential to perhaps someday rival some of the major US entertainment giants.

Bottom line: Bona Films’ aggressive pursuit of foreign co-productions reflects the recent opening of China’s film industry, which is forging growing ties with Hollywood.

Related postings 相关文章:

◙ News Corp Makes New Play for China 新闻集团入股博纳影业集团

◙ China-Hollywood Lovefest Continues With Latest Deal 小马奔腾携手数字王国 中国与好莱坞恋情继续

◙ Wanda’s AMC Buy: The Show Isn’t Over Yet 万达并购美国AMC影院：表演还未结束

Disney, Tencent Tie-Up to Animate China 迪斯尼、腾讯合作研发动漫

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Coming soon to movie screens in China: “Pudgy Penguin: The Movie”. That may sound like fantasy for now, but it could soon become reality following a newly announced partnership between animation giant Disney (NYSE: DIS) and Chinese Internet leader Tencent (HKEx: 700), whose ubiquitous logo featuring a pudgy cartoon penguin is practically synonymous with the web in China. (company announcement; English article) Talks of the tie-up were first leaked last week, at which time I predicted the pair would form a joint venture animation studio similar to the one announced earlier this year between another US industry leader, DreamWorks Animation (NYSE: DWA) and local partner Shanghai Media Group (SMG). (previous post) The structure of Disney’s partnership looks a little different from a traditional joint venture, with the 2 sides announcing they would set up an animation R&D center along with China Animation Group. The Ministry of Culture also appears to be heavily involved, meaning the venture should have good government connections to help it steer clear of China’s huge bureaucracy governing the sensitive media sector. Despite its name as an R&D center and the emphasis on developing local talent for China’s animation industry, which look mostly like a public relations exercise, this initiative closely resembles an animation studio in everything but name, with the announcement saying it will develop content for the China market. From my perspective, I really do like this particular tie-up, as it brings together a major foreign player in the form of Disney, together with a major new media player like Tencent and government connections from the Ministry of Culture and the China Animation Group. Tencent is currently making aggressive moves in the online video market, and, joking aside, its animated pudgy penguin would make a great character for a future animated movie or TV or Internet series to help promote the Tencent brand and the partnership in general. While the government’s close involvement has its positive elements, it could also be one of the new venture’s weak points, as government involvement in anything tends to add an extra layer of bureaucracy from officials who often have other agendas besides running an efficient business. But then again, no one ever said this was an official business, which could be another weakness in this partnership if and when it ever starts to earn profits. Comparing this Disney-Tencent tie-up with the DreamWorks-SMG one, I would have to say I personally like the DreamWorks one better, since SMG, as China’s second biggest media group, is also a quasi-government organization but lacks formal government ties, giving it more room to innovate. But that said, China’s animation market is certainly big enough for major joint ventures led by 2 of the world’s top players, and I would fully expect both  to see strong success both in China and also potentially through exporting their products to other Asian markets.

Bottom line: Disney’s new tie-up with Tencent looks well positioned to capitalize on China’s animation market, though close government participation remains a medium-sized risk factor.

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◙ Facebook, DreamWorks in Latest China Moves Facebook、梦工厂在华最新动向

◙ Disney-Tencent Talks: China Looking Animated 迪士尼与腾讯沟通动漫合作

◙ More Media IPOs From People’s Daily, Shopping Channel 电视购物，继人民日报后又一计划上市的媒体