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October 22, 2009

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SMG seeks to be nimble with split

SHANGHAI Media Group, the city's largest media conglomerate, yesterday announced that its operations will be split into two parts as it seeks to be nimble to react quickly to the market.

On one side will be the TV and radio news operations and certain core technology department which will be responsible in providing non-profit public service programs. The other part comprises production, advertising, distribution, media-related operations and investment.

Li Ruigang, president of SMG, said the separation of production and broadcast is a trend for the TV industry to react more efficiently and quickly to the market.

The splitting of operations marks a response by SMG to heed the call of the State Administration of Radio, Film and TV for TV production and broadcast functions to be separated.

The group's affiliated TV production and distribution company aims to become the largest content and service provider and distributor of Chinese language programs on the mainland.

"China's media sector has experienced tremendous growth over the past years and will continue to evolve rapidly," Li said. He added that with the latest move, SMG aims to enhance its leading position in the market.

Previously state-owned terrestrial and cable TV stations were both broadcast and production centers. But under the new plan, production resources will be released into the market, while the state will retain control over broadcast.

According to local industry insiders, the separation of production and broadcast is expected to cut the current costs of media operations.

In August, SMG was the first broadcaster to get the official nod from SARFT to begin its transformation.

It now owns a share holding company which is involved in content distribution, programming, production, new media and home shopping, among others.




 

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