Further Opening-up of the Cultural Sector

By staff reporter JIAO FENG

AT the Third Plenary Session of the 18th CPC Central Committee, held last November, the Party proposed to establish a sound modern market system of cultural industry and to develop a modern public cultural service network, in efforts to promote opening-up of the cultural sector. Professionals working in the industry have expressed positive views.

Breaking Barriers

After years of development, China’s cultural industry has expanded considerably. However, many businesses in the circle are still vulnerable to market risks, due to narrow business scope and low market concentration. This predicament calls on industry leaders to hasten the steps of convergence, merger and reorganization between companies in different areas and realms, and also between those under different types of ownership.

According to Wang Changtian, president of Enlight Media, the CPC has set a new tone for the cultural industry. Now that the main direction has been affirmed, the industry expects more detailed support policies. “What most directly affects the cultural industry is undoubtedly the attitude of the government – which realms should be under government control, and how to manage them. Our feeling is that the government is gradually loosening its grip on the industry. We are looking forward to a more just and transparent market and legal system that will encourage growth of cultural businesses,” Wang said.

The Party’s pledge to deepen reforms to the cultural system and improve the management of the cultural sector is generally expected to entail cultural reform measures. New policies are anticipated to increase the momentum of reform of state-owned cultural enterprises, promote mergers and reorganization of cultural businesses, and relax control over market entry for private capital. Industry convergence in the press and publishing, film, radio and television sectors in particular will see steady advances in the coming months and years.

Wang pointed out that since CCTV (China Central Television) broadened its platform in recent years, private cultural companies have had more room for development. Through open bidding, many privately-owned TV production companies, including Enlight Media, have scooped a number of CCTV prime-time slots in 2014. “Enlight Media is the biggest private production company to form a partnership with CCTV. As the state loosens its control, we will broadcast more programs on CCTV in the coming year, and hope to gain more income and revenue through heavy investment in our programs,” Wang said.

To deepen reform of its cultural system and promote opening-up of the cultural sector, China needs to improve its incentive schemes by encouraging domestic cultural enterprises and public institutions and supporting their participation in international competition, so promoting exchanges and cooperation. Ministry of Culture statistics show that China now conducts cultural exchanges with more than 160 countries and regions. The country has also signed inter-governmental cultural cooperation agreements, and plans cultural exchanges with 145 countries. Bolstered by this interaction, an array of well-known Chinese cultural brands has become globally recognized.

Market Power

A large number of mergers and reorganizations took place in China’s cultural industry in 2013 as a result of the sector’s swift development. According to National Bureau of Statistics data released last August, the added value of China’s cultural industry last year surpassed RMB 1.8 trillion, accounting for 3.48 percent of the country’s GDP.

In the first three quarters of this year, gross private investment in fixed culture, sport and entertainment assets reached RMB 201.8 billion – a 39.4 percent year-on-year growth, and 16 percent higher than that of fixed asset investment by private capital across all industries. In the same period, China’s cinemas raked in RMB 16.425 billion in box office receipts, including RMB 9.56 billion from domestic films. Ticket sales for domestic films account for 58.2 percent of total box office revenue, a year-on-year increase of 93.8 percent. The value of the mobile gaming market exceeded RMB 5 billion in the first half of 2013 – an increase of 135.3 percent over that of the previous six months.

“By improving production and management and developing a modern culture market, the government has resolved property right relations, acknowledged market rules, and underlined the importance of complete industry chain. In contrast to its previous preoccupation with monitoring public opinion, the state has made major progress,” president of Times Publishing Wang Yafei said.

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