Television and movies are wildly popular American exports. Yet many American media and entertainment companies continue to get the cold shoulder from the Chinese government, which is notorious for controlling all forms of media its citizens consume. Despite the enormous consumer market potential in China, US-based media companies are finding it difficult, if not impossible, to find success in the Chinese market.
Disney and Apple have had their movie services shuttered in China. Netflix recently announced its entry into China looks increasingly unlikely. Is there any media or movie company that is succeeding in China?
The Alibaba Group is a treasure trove of e-commerce websites in Asia. Alibaba has made itself the place for online commerce in China. It offers the same types of services as eBay, PayPal, Amazon, and more under one umbrella.
The holding company owns Alibaba.com, a leading online marketplace for importers and exporters in China and Japan. The Alibaba Group also wholly owns Alibaba Cloud Computing, which supports its technology platform. The company operates all of China’s largest online retail websites. Altogether, the Alibaba Group’s websites count millions of registered users.
The company went public in 2014 and acquired Chinese online video provider Youku Tudou for $4.6 billion in 2016.
In Chinese, Youku means “what’s best and what’s cool,” and that’s what video content provider Youku Tudou hopes to show consumers in China. The country’s answer to Hulu and YouTube, the company features an online library of video content, including professional productions such as serial television shows, movies, variety shows, sporting events, and music videos.
Youku.com was launched in 2006; it went public in late 2010 and merged with rival firm Tudou in 2012, creating the biggest online video provider in China. The two complementary companies combined in order to save on content licensing, bandwidth, and other costly services before Alibaba purchased the company.
Tough Road Ahead
With such tight government control and successful Chinese companies already dominating the market, US-based media and entertainment companies will likely continue to experience difficulty in breaking into the market in China and finding traction.
Michael McLellan covers the business of restaurants, marketing, media, technology, and more for D&B and Hoover’s. He is a graduate of the University of Texas at Austin’s Radio-Television-Film program.