China OK’s private coin for digital

Transition to be finished by 2015

BEIJING — China’s State Administration of Radio, Film and TV (Sarft) has given private firms the go-ahead to invest capital in the digitization of the country’s TV network to speed up the sluggish switchover.

On its Web site last week, Sarft urged cities taking part in digital TV trials to speed up the transformation from analog, a process that is supposed to be finished by 2015.

“Sarft is very dissatisfied with the progress of the deployment of digital TV, so the circular is just a step to accelerate that process,” Zeng Huiming, editor of the Radio and TV Information (RTI) magazine, told the China Daily.

It’s a daring step, allowing private capital into an area fiercely guarded by the state.

To safeguard the government’s cast-iron hold on broadcasting, state-owned broadcasters can involve private capital only if the state-owned firms retain a controlling 51% of any joint ventures. Also, broadcasters will be allowed to invest in channels in other regions — another significant change, as broadcasters and network operators are usually allowed to work only in their own regions.

However, the Beijing government is very keen for digitization to be a success.

Zhang Haitao, vice minister of Sarft, said in March that digitization is something vital to the TV and radio industry, which should use it as a tool to speed up its reforms and increase competitiveness.

Originally, the plan was to have 30 million digital TV subscribers by the end of 2005, but by the end of last year there were just over 1 million households watching digital TV.

ost subscribers are used to free TV, which is why cable operators are being encouraged to follow the model of Qingdao City, where viewers get free set-top boxes if they promise to pay subscription fees for a number of years.

Cable operators often cannot afford to pay for the boxes, which cost around $60, and then wait to get repaid from subscriptions. Allowing injections of private capital is supposed to ease their plight.

The move comes on the heels of several restrictive measures issued by Sarft regarding foreign players like Warner Bros. and News Corp.

Sarft recently banned local TV and radio broadcasters from creating channels in partnership with foreigners and came up with the summer ban on exhibition of foreign films.

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