Qin Jia Yuan Media Services Company Limited (Stock Code: 2366, hereinafter referred to as "QJY") is pleased to announce the formation of a joint venture with China TV Copyright Protection Center* (hereinafter referred to as "the Center") and Beijing Huaxia Yinghao Business Services Limited* (hereinafter referred to as "Huaxia"). The joint venture, namely Beijing Guoguang Huaxia Culture Media Company Limited* (hereinafter referred to as "Guoguang"), has been established and commenced business in Beijing recently, and is principally engaged in the distribution of foreign films and television ("TV") programs for broadcasting in new media in mainland China. QJY, who has a 45% stake, is the largest shareholder of Guoguang. Dr. Leung Anita Fung Yee Maria, chairman of the board of directors of QJY, and Mr. Guo Hong, an executive director of QJY, have accepted the invitations to act as chairman and chief executive officer of Guoguang, respectively. Other directors of Guoguang include Mr. Lai Tsz Wah, chief executive officer of QJY.
The Center, one of the major joint venture partners, is a business unit under the State Administration of Radio, Film and Television (hereinafter referred to as "SARFT") and is engaged in the provision of domestic and foreign films and TV programs.
Guoguang has four divisions, namely program acquisition, preliminary examination, copyright monitoring and program distribution. The program acquisition team is responsible for the search and acquisition of foreign films and TV series (hereinafter referred to as "foreign films and TV programs") as well as TV programs for broadcasting in new media and on TV channels in China. The preliminary examination division has a pool of professional talents from the Center, who examine the films and TV programs intended to be acquired by Guoguang and perform screening and editing before submitting for final approval by the relevant government authorities. The copyright monitoring division, which is comprised of professionals, uses advanced technology, including networking, to safeguard the copyright of film and TV programs. The distribution division is responsible for the distribution of the acquired foreign films and TV programs with importation permit granted by the relevant government authorities and proper copyright to new media in China.
Being the largest shareholder holding 45% of the shares in Guoguang, QJY will bear all procurement and operating expenses of Guoguang and will enjoy returns on its investment on a preferential basis. "The domestic demand for foreign and domestic films and TV programs is huge. Foreign film and TV programs are particularly desired by the audiences of the new media, who are mostly youths with strong purchasing power. As a result, films and TV programs have become a major source of advertisements for the new media. Furthermore, relevant authorities in China have stipulated that before any new media broadcast any foreign films and TV programs, it must have obtained the proper copyright while the production itself must be censored and approved with the issuance of importation permit. In this respect, Guoguang will fully comply with the national regulations announced by the relevant authorities in its films and TV programs business. The preliminary examination system will lower the risk of the issuance of importation permit being rejected for any films and TV programs production proposed to be acquired. Guoguang will be one of the first in China to offer professional preliminary examination, monitoring and follow-up services. In view of the gigantic amount of foreign film and TV series productions entering the Chinese new media market each year, it is believed that the number of foreign TV and film productions distributed in the fourth quarter of 2012 and year 2013 to be handled by Guoguang's professional and efficient internal preliminary examination and monitoring services will exceed 1,000. In 2014, the business efficiency will be even more impressive," said Mr. Guo Hong, an executive director of QJY and chief executive officer of Guoguang.
Mr. Lai Tsz Wah, chief executive officer of QJY, also has high hopes for the establishment and operation of Guoguang. Mr. Lai expressed that in addition to the making and production of quality domestic film and TV programs, QJY will also be able to distribute outstanding foreign films and TV programs thanks to the operation of Guoguang that can enrich the core business of QJY. QJY will consolidate all the domestic and foreign film and TV productions of which it has broadcasting rights so as to create a more appealing and extensive film library. Capitalizing on the surge in advertising income of new media in recent years and the general trend of the integration of telecommunication, internet and cable TV networks, QJY will definitely become the leading supplier of film and TV contents in the domestic market.