At the Asia Business Conference media discussion, Mr. Wu Xiaoyong, CEO of Phoenix Satellite Television and Ms. Sheryl WuDunn, Project Director for the New York Times Strategic Planning Group, led a powerful discussion on trends taking shape in the rapidly growing Asian media market, focusing primarily on China.
The panel sought to identify opportunities to transform the existing political, social, economic and legal environments. Major ongoing trends discussed included intellectual property rights and piracy, convergence of modes of delivery, and globalization and consolidation as companies look for strategic merger partners.
China was a topic of debate due to its large market size and political restraints against independent media. Xiaoyong pointed out that there are 305 million television homes in China versus 100 million in the U.S. and predicted that Asia will surpass 50% of worldwide GDP by 2025, making it a significant global economic force.
He also noted that as China builds highways, it is laying the latest fiber optic network and may therefore have a more sophisticated network than the U.S. when the infrastructure is complete.
However, the role of media in China is markedly different. Mr. Xiaoyong described it as “the last bastion of state ownership.” Media has been much slower to move to privatization than other areas of the economy because of lingering political strongholds in the industry.
The ongoing balancing act that China is trying to strike is between encouraging trade and keeping a lid on political uprisings. As the Chinese media move toward a free market orientation, they are restricted by old bureaucracies.
WuDunn found that the New York Times’ website was lifted from censorship when a high-ranking politician complimented the site; the bureaucrats were simply afraid of making any changes without clear signals “from the top.”
Picking up on the role of the press, WuDunn summed up the role of the press in Asia by mentioning how she is consistently asked in China which arm of the government The New York Times represents. The idea of an independent press is difficult for some to imagine since it has always been an indelible part of government propaganda.
There is also much suspicion remaining that the foreign media act as spies. Interestingly for the uninitiated, it was not until the 1970’s that the U.S. passed a law barring the CIA from placing agents in the press.
Xiaoyong suggests to combat these forces, media companies should focus on programming strategy, pointing out that it is natural for the government to want to control media due to its strategic nature, also noting that Echostar and BSKYB are illegal in Canada and there are prohibitions against Hollywood content in France.
Similarly, China attempted to block Internet access but is finding such restrictions difficult to implement. Xiaoyong pointed out the necessity of marketing strategy from the inside and the importance of knowing what consumers want to see.
Xiaoyong’s company Phoenix Satellite Systems was the only Chinese language content provider with extended coverage of Sept. 11th. His competitor, the Chinese station, gave three minutes of coverage. Xiaoyong felt that his company gained much credibility and loyalty from Chinese consumers by providing this content.
Xiaoyong believes market forces will eventually work, for example, as incomes rise in China and as technology such as satellite receivers spread. Consumer demand for relevant content will lead to media liberalization. Similarly, as China’s media industry develops, it will need to protect its own intellectual property rights, and thus market forces will work to minimize rampant piracy.
In the meantime, their advice is to provide compelling but non-controversial content, working with inside sources and remaining flexible as the industry develops. WuDunn and Xiaoyong agreed on the growing importance of understanding Asian culture and developing relationships between countries.
They suggested that bridges could be built through business and student exchanges as well as a closer relationship with global media companies. They also urged working together to provide a balance of proper controls on content where desired and furthering an open and independent media.