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March 31, 2010

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Cooperation up among media and telco firms

CHINESE telecommunications and new media firms are increasingly cooperating with traditional media firms, following the government's announcement to develop "Three Network Convergence" among Internet, broadcast and telecommunications networks.

BesTV, an IPTV subsidiary under Shanghai Media Group, has cooperated with 28 media firms from Shanghai, as well as Zhejiang and Guangdong provinces, to form a new media alliance to report on Shanghai World Expo.

Meanwhile, China Telecom's Shanghai branch has formed a new media alliance to provide various services including payment, multimedia messages and coupon downloads for "e-Surfing" handset users.

"Content is king," said Carol Wang, an analyst at Morgan Stanley, which expects a boost to both traditional and new media sectors from "Three Network Convergence."

In January, China released a statement encouraging cross-industry operations among telecommunications, broadcast and Internet firms. It is promoting full network convergence by 2015.

Chinese broadcasters are no longer banned from providing value-added telecom services and basic communication and Internet services, like broadband, as in the past. Telecom operators will be now permitted to operate TV and radio production and transmission.

BesTV and its alliance members will make use of new media and technology, including interactive video content, to cover the Expo.

The alliance will provide news, event information and World Expo history. Meanwhile, BesTV will collect video clips from the public to better report the event.

In 2010, China's IPTV user base will reach more than 9 million from 4.7 million last year, analysts said.

Compared with traditional TV services, IPTV provides users customized and interactive services, such as VOD (video on demand).

Shanghai Telecom's partners include Internet giants like instant message player Tecent Inc and game giant Shanda Entertainment.

"To traditional media companies, mobile phones offer a new channel for them with huge potential," said Shanghai Telecom's General Manager Zhang Weihua.

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