On May 28, China Broadcasting Network Co., Ltd. was officially established after four years of preparation. The establishment of the National Radio and Television Network Company is a landmark event in the development history of China's broadcasting industry. Industry insiders point out that in the future, the National Radio and Television Network will focus on promoting the integration of cable television networks, transitioning from a fragmented system to a unified one, with standardized planning, technology, operations, and management across the country.
Waiting for Four Years
Since 2010, the formation of the National Radio and Television Network Company has taken a long journey of four years.
On January 21, 2010, the State Council issued the "Overall Plan for Promoting the Integration of Three Networks," which proposed that from 2010 to 2012, the focus would be on the pilot phase of network integration, emphasizing the dual entry of broadcasting and telecommunications, cultivating qualified market entities, and upgrading network infrastructure; it also called for the establishment of a national-level cable television network company to initially form a moderately competitive industry structure.
The former director of the Guizhou Broadcasting Bureau, Li Xinmin, was transferred to the preparatory group for the National Network to oversee the preparation work. In the initial proposal, the preparatory group suggested that the national treasury invest nearly 100 billion yuan as startup and integration funds for China Broadcasting, but this proposal was subsequently rejected by the State Council's leadership group for network integration. With the first proposal not approved, the originally scheduled establishment of the National Radio and Television Network in December 2010 was naturally delayed.
For a long time, there was no substantial progress in the integration of the three networks, and the formation of the National Radio and Television Network Company was marked by the awkward and prolonged waiting of "modifying proposals - proposals being rejected - rumors of establishment - establishment being postponed."
With the widespread adoption of the internet and mobile phones, the status of the broadcasting industry has become increasingly marginalized. When the national strategy for network integration was proposed, the broadcasting industry was almost universally excited, believing it was the best opportunity for transformation and upgrading, and for crossing into the telecommunications sector. However, the competition for departmental interests led to the prolonged indecision regarding the establishment of the National Network, making it difficult for broadcasting to obtain telecommunications licenses. Without an "organization" to rely on, provincial broadcasting entities were extremely disappointed and could only struggle alone in the market.
Over the past four years, the rapid development of 3G networks has seen the three major operators aggressively entering the content space with IPTV and mobile video, leading to a rapid loss of broadcasting television users and a continuous decline in the performance of broadcasting network companies. Limited by technological and talent advantages compared to telecommunications operators, broadcasting enterprises were unable to fight back and were naturally marginalized.
"One Network Nationwide"
Although the establishment of the National Radio and Television Network Company has come after the optimal timing, industry insiders still believe that it is better to establish it late than not at all. Luo Xiaobu, the operations director of Gehua Cable, candidly stated, "The establishment of the National Radio and Television Network is definitely a good thing; broadcasting has lacked an organization for so many years, and finally, there is an organization now."
On May 28, after the listing ceremony of the National Radio and Television Network (广电国网), the National Radio and Television Administration held a seminar on "The Integrated Development of Broadcasting and Television Networks in the Context of Building a Strong Cyber Nation." Regarding the concerns from the public about the positioning and development goals of the National Radio and Television Network, its chairman Zhao Jingchun provided a detailed explanation. He stated that the positioning of the National Radio and Television Network has four aspects:
First, to adhere to the correct guidance and direction, establishing a modern communication system that is three-dimensional and widely covered; second, to become a truly large state-owned cultural enterprise, devoid of administrative characteristics, strictly following the principles that meet modern enterprise requirements, reflecting cultural and broadcasting characteristics, and carefully designing management models and asset organizational forms; third, it is a holding company, with market-oriented operations conducted by its controlled enterprises. The National Radio and Television Network primarily focuses on strengthening management, attracting talent, promoting innovation, building an industrial chain, creating an ecosystem, and cultivating the brand of the broadcasting and television network market; fourth, to strive to become a national-level company. To ensure that the "China" brand lives up to its name, efforts will be made to incorporate the integrated development of broadcasting and television networks into the strategic layout and major project planning for building a strong cyber nation, aiming to make broadcasting and television networks a national information infrastructure network.
Zhao Jingchun pointed out that aiming for a nationwide unified network and achieving a comprehensive cable television network across the country is an inevitable requirement for the rebirth of broadcasting and television networks. It is essential to promote the integration of cable television networks from a decentralized state to a unified one, ensuring that cable television networks are uniformly planned, technically standardized, operated, and managed on the basis of a nationwide unified network.
First, there must be an internet mindset, organically combining the awareness of broadcasting and television networks with internet thinking to plan and promote the development of broadcasting and television networks.
Second, focus on technological integration. The National Radio and Television Network is both a network company and a technology company, and it must support development through technological integration. It should make good use of the latest information and network technologies to make broadcasting and television networks interconnected, mobile, and intelligent.
Third, focus on network integration. To adapt to the needs of a two-way coordinated communication system, it is necessary to promote the interconnection and intelligent full coverage of cable, wireless, and satellite transmission networks, strengthening the interconnection capabilities of broadcasting and television networks with telecommunications and internet services.
Fourth, focus on business integration. It is essential to excel in core broadcasting and television businesses while also crossing boundaries. This is particularly important in response to the market changes from monopoly to competition. Breaking self-imposed closed loops, achieving openness, integration, and innovation will allow for diverse and personalized business forms to meet user needs and enrich user experiences.
Fifth, focus on the integration of development models. The National Radio and Television Network cannot start everything from scratch; instead, it should promote explosive growth through acquisitions, mergers, investments, shareholding, and cooperation.
A New Journey
The listing of the National Radio and Television Network signifies the beginning of a new journey, but the challenges surrounding it remain to be resolved, and the road ahead may be fraught with difficulties.
In today's rapidly developing mobile internet landscape, the entire industry is undergoing significant changes. The emergence of new technologies and business models is continuously impacting the traditional business forms of telecom operators and broadcasting enterprises. Firstly, a large number of internet companies and terminal enterprises are leveraging OTT services, such as set-top boxes, to indirectly achieve some of the goals of the convergence of the three networks, putting broadcasting and telecom operators at risk of becoming secondary players. Secondly, against the backdrop of a crisis facing traditional media, video websites are heavily investing in copyright development and original content production, challenging the content creation advantages of broadcasting companies.
Local broadcasting companies are accelerating their collaboration with the industry chain to avoid "waiting for death" in market competition. For example, Zhengzhou Mobile is partnering with the Zhengzhou branch of Henan Cable, and Hubei Broadcasting Network is collaborating with Hubei Mobile on integrated business operations. Recently, Jiangsu Broadcasting, which has nearly 18 million cable users, received approval for its IPO application. Along with previous operators like Tianwei Video, Gehua Cable, Huashu Media, and Dajiang Media, an increasing number of local broadcasting companies are seeking to go public, making it difficult for the State Grid to achieve its goal of integrating local broadcasting.
It is estimated that the overall asset valuation of the national broadcasting and television network is approximately 150 billion yuan, with net assets exceeding 70 billion yuan. If the valuation of listed company assets is included, the total assets of its cable network amount to about 180 billion yuan. However, the initial funding for the National Broadcasting Network is only 4.5 billion yuan. Industry insiders believe that the possibility of integrating local provincial networks after the establishment of the National Broadcasting Network is virtually nonexistent. Its core business will focus on establishing an interconnection platform for the national cable network and applying for broadcasting IDC (Internet Data Center) licenses, among other initiatives. The challenge for the new leadership of the National Network lies in how to create an effective interconnection platform that allows broadcasting network companies in various provinces and cities to truly share and reasonably allocate benefits.
As for the State-owned Radio and Television Network Company itself, despite its grand ambitions, Huang Zhijian, Director of the Reform Office of the Publicity Department, candidly stated that there is still a long way to go for the company in terms of how to accelerate its transformation into a shareholding system, how to clarify the relationship between relevant party and government departments and the company, how to establish a system and mechanism with orderly connections, and how to truly implement a management model and asset management form that meet the requirements of modern enterprise development while reflecting the characteristics of a cultural enterprise.