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Rumor: Telecom Operators Lose IPTV Revenue Share to CNTV

Itxinwen.com, 12/16/11

According to a source within the telecom operator, Shenzhen Telecom can receive a 50-60% revenue share in an IPTV joint venture with Shanghai Media Group IPTV subsidiary Shanghai BesTV, but receive only approximately 30% of revenues in an IPTV partnership with CCTV's national online TV station CNTV and local broadcasting authorities. According to another industry source, CNTV takes the lion's share in partnerships with telecom operators, who receive approximately 10% of revenues.

Shandong Telecom recently partnered with CNTV and Shandong Radio & TV Station to launch IPTV services, while Beijing Unicom and Beijing TV Station did the same earlier this year. Shanxi Radio and Television partnered with CNTV and Shandong Unicom to launch IPTV services in November 2011.

In August 2011, CNTV filed lawsuits against Guangdong Unicom and Jiangsu Unicom in Guangzhou Intermediate People's Court and Nanjing Intermediate People's Court respectively for broadcasting CCTV content without permission. CNTV said it would launch a large-scale campaign against IPR infringement.

Editor's Note: There are currently two models of IPTV cooperation: the "1+1" and "1+1+1" models. The first involves a partnership between a single IPTV content service license holder and a telecom operator. For example, BesTV has partnered with local telecom operators for IPTV operations in Shanghai, Jiangsu, and Guangdong. The "1+1+1" model, sometimes referred to as the "Yunnan Model," involves a joint venture between the telecom operator, CNTV, and local broadcasting authorities, with CNTV as the controlling shareholder. For more information on this topic, please see "Yunnan Telecom, TCL Release Smart TV Set," MD 11/23/11 issue.

Keywords: business model Nanjing Intermediate People's Court Shanxi Radio and Television convergence Shanghai Media Group IPR infringement IPTV telecom television CCTV BesTV Guangzhou Intermediate People's Court revenue share Shandong Radio & TV Station CNTV law China Telecom China Unicom litigation 0728.HK 0762.HK 600050.SH CHA CHU BTV JV

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