Wednesday, June 29, 2011

China's Great Firewall Helping Chinese Companies Get American Business

Warner Bros. Entertainment's joint venture in China has reportedly made a deal with Youku, sometimes referred to as the "YouTube of China".  Reuters reports:
"Under a three-year agreement with Warner Bros, Youku will add between 400 to 450 Warner Bros movies to its Youku Premium library.

"People are increasingly willing to pay for high quality content, and we take the growth of Youku Premium as a sign that the market is improving for paid services," Dele Liu, Youku's chief financial officer, said in a statement."
Why would Warner Bros. make a deal with Youku instead of say... YouTube?  Well, one reason probably of high importance is that YouTube is currently blocked in China.  Pretty simple.

So, from an American perspective is the news about Warner Bros. new deal good because an American company can further profit in China?  Is it good because possibly more content from the US will be seen in China?

Or is it bad because Warner Bros. is presumably helping the business of a Chinese company that heavily censors its material?

Will Warner Bros. receive as much backlash for this deal as YouTube would if it were to announce that it planned to heavily censor in China so that it could conduct business there?

What's the difference?

Just something to ponder.

Note: I can't be positive that YouTube agreeing to censor would lead to it being available in China and raise the possibility for the sake of making a point.

Update:  Regarding the statement "Warner Bros. is presumably helping the business of a Chinese company" there is an interesting update in the Reuters article:
"Youku shares up 15 pct on NYSE, among top gainers"

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