Chinese video biz going postal to stress rentals

BEIJING – China’s answer to Blockbuster has arrived.

The audiovisual industry decided recently to shift its focus away from sales and stress rentals instead, according to China Audio-Visual Assn. chief Liu Guoxiong.

The association has teamed up with the country’s national postal service to form the China Postal Audio-Visual Rental Co. Ltd.

The new company, approved by the Culture Ministry, plans to take advantage of the more than 60,000 post offices nationwide, which will act as a video rental chain. Software will be supplied by the association’s 300 members.

More than 200 postal offices in Nanjing, Hangzhou, Fuzhou and Liaoning province have already been chosen to adopt the new system on an experimental basis, with Shaanxi, Shandong, Hunan, Jilin, Hubei, Shanxi, Inner Mongolia, Hebei, Guizhou, Jiangxi and Henan provinces and Beijing and Shanghai to follow. The plan is to have a nationwide rental structure in place within five years.

According to official statistics, videocassette recorders are owned by a growing number of Chinese urban consumers. In Beijing, 20% of households own VCRs, while the number is 43% in Shanghai and 59% in Guangzhou.

But most of the cassettes played on those VCRs are pirated. The government estimates that the 100,000 video rental stores and 50,000 commercial video exhibitors in China required at least 80 million cassettes in 1995, but the number of legitimate copies distributed that year was just 3.5 million.

Meanwhile, a newly adopted policy requires commercial video exhibitors to purchase their videos from authorized suppliers and prohibits them from screening videos intended solely for home viewing.

The decision, announced by Culture Minister Liu Zhongde, is aimed primarily at halting the illegal screening of imported videos. Liu added that all commercially screened videos must be approved by the state copyright authorities and have the Culture Ministry’s exhibition permit.

In addition, local authorities will be required to establish specialized video supply agencies in order to unify distribution channels. The distributors will be forbidden from supplying videos outside of their area.

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