Warner Bros signs China VoD deal with YOU On Demand

The deal will make Warner Bros movies available to three million homes with access to CCTV-6’s pay-TV arm, China Home Cinema. Headed by former WWE executive Shane McMahon, New York and Beijing-based YOU On Demand has a 20-year joint venture deal with CCTV-6.

The Harry Potter franchise, including Harry Potter And The Deathly Hallows - Part 1, are among the first movies that will be offered to China Home Cinema subscribers under the deal. Delivered by cable TV and IPTV, the service is expected to eventually reach 200 million households in China.

“China is developing methods for consumers to view movies outside the cinema in a legitimate fashion,” said Jim Wuthrich, Warner Bros president for international home video and digital distribution. “Through YOU On Demand’s platform, millions of potential consumers will be able to view our films.”

McMahon, YOU On Demand’s chairman and CEO, added: “I’m excited for the millions of Chinese consumers that will be able to experience and enjoy the very best content that Hollywood has to offer.”

The Warner Bros deal was brokered by CAV Warner Home Entertainment Co, which is Warner Bros Home Entertainment Group’s joint venture in China, and You On Demand Holdings.

The deal appears to widen access to US movies in a marketplace where theatrical distribution of foreign films is handled by just two state-owned companies – China Film Group and Huaxia Film Distribution – and limited to 20 revenue-sharing releases a year. Additionally, foreign media conglomerates have not been granted broadcast TV licences for China.

However it doesn’t open the landscape to competition; CCTV-6 is part of the same state-owned conglomerate as China Film Group.

China missed a March 19 deadline imposed by the World Trade Organization (WTO) to allow a wider range of companies to handle theatrical distribution of foreign films. The quota issue and broadcast licence issues were not addressed by the WTO.