Government-backed movie streaming service coming to China in Q4, bringing Paramount titles along

Government-helmed China Movie Channel's site M1905 announced this week that it's joining forces with Jiaflix -- a consortium comprised of Hollywood-types like former Columbia exec Sid Ganis -- to launch a movie streaming service in China. The still unnamed offering is set to stream both Chinese and international films, including a deal struck with Paramount that will bring the studio's back catalog and future releases to the service. The fruits of the partnership are set to launch in the fourth quarter of this year, bringing streaming to a number of platforms, including smartphone and tablets. Jiaflix and China Movie Channel added that they'll have a plan in place to combat potential piracy through the service, but have yet to spell out what such a plan of action would entail.


PRESS RELEASE

Jiaflix Named Exclusive Partner of China Movie Channel Web Subsidiary M1905; Venture Will Stream Films Throughout China

Jiaflix Enterprises principals Sid Ganis, Marc Ganis and Kenneth Huang, and M1905, the official internet subsidiary of China Movie Channel/CCTV6 jointly announced today an exclusive venture to stream both Chinese and international feature films on a subscription basis (SVOD), as well as international feature films on a transactional video on demand basis (TVOD) throughout China. The long term agreement names Jiaflix, a U.S./China enterprise, M1905's exclusive authorized party for the importation of international films and libraries from North America and Europe for new media, internet streaming and mobile devices.

"China has the largest number of online users in the world, and M1905.com, commonly known as China Movie Web, is SARFT's official internet movie site. The M1905.com web site is dedicated solely to movies and caters to fans of both domestic Chinese and international films. It averages more than 16 million page views and 4 million unique visitors daily, has more than 3 million registered users and has been growing rapidly, more than doubling year to year," said Jiaflix principal Marc Ganis. "This new venture will bring the best that Hollywood has to offer to viewers in China. It represents a great opportunity to enhance cultural cooperation between our two nations and we are thrilled to be part of this official bridge between the Chinese and Hollywood film industries."

Jiaflix also announced today that it has signed a multi-year licensing deal with Paramount Pictures to include titles from Paramount's extensive and renowned film library for both SVOD and TVOD.

"This is an important step for Paramount in terms of positioning our product in China," said Hal Richardson, President, Paramount Home Media Distribution. "Paramount has worked with China Movie Channel for many years and we are happy to be expanding our relationship and online movie viewership in China through our deal with Jiaflix."

M1905's Director and Vice President, Longfei Liang, adds, "We are delighted to make this announcement with our partners at Jiaflix. China has a long and storied history in films. New media distribution of films is the future and M1905 is excited to be working with Jiaflix and Paramount Pictures, an iconic Hollywood studio, in bringing great movies to our expanding online audience."

The agreement with Paramount is the first under the Jiaflix partnership with M1905 that will see licensing deals with several other North American and European content providers.

M1905 is the wholly-owned subsidiary of the China Movie Channel, which is under the State Administration of Radio, Film and Television (SARFT) of the People's Republic of China. China Movie Channel is that country's largest television buyer of international movies and has agreements with virtually all of the major movie studios. M1905 sub-licenses domestic Chinese films to a number of video web sites in China. In June 2012, M1905's mobile television service officially started operations with China Mobile and China Telecom's mobile video service allowing M1905 to provide officially licensed content and VOD service to the more than 100 million 3G mobile subscribers in China.

Sid Ganis' long affiliation within the film industry along with his recent role in China as Honorary Chairperson of Wuxi Studio Development and Promotion Committee, assisted in bringing this venture to fruition. He is a former President of the Academy of Motion Picture Arts and Sciences and previously held roles as Vice Chairman of Sony Pictures Entertainment and President of Paramount Pictures. Ganis is currently an independent producer at his company Out of the Blue Entertainment and Co-Executive Producer on last year's ABC Television series PAN AM.

Kenneth Huang is a China based entrepreneur and investor. He is active in a number of important business sectors in China including capital markets, infrastructure construction, sports and entertainment. Mr. Huang is a successful philanthropist and was voted the most popular philanthropist by Sina.com and BQ Magazine in December 2009. Mr. Huang was raised in China and educated in the United States.

Marc Ganis is President and Founder of Sportscorp Ltd., a Chicago based sports business advisory firm. Mr. Ganis has been involved in a number of the most visible and valuable sports business transactions in the U.S. He has been active in China for more than a decade in the capital markets, sports and entertainment sectors.

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