CCTV jumps into Web for Olympics

The Wall Street Journal is reporting that CCTV,
China’s state-run national television
broadcaster is teaming
with two Internet ventures to exploit the Beijing Olympics’ status as the first
Summer Games expected to attract droves of online viewers.

In an unusual move for the broadcasting giant, China Central
Television announced yesterday that it is working with the MySpace China
social-networking site and online-video site Tudou.com to run an interactive Web site for the August
Games. The CCTV site will offer streaming video broadcasts of events, which
will be viewable only in
China,
and Web profiles through which users can contact Olympic athletes. The Web site
of CCTV, the monopoly national broadcaster, draws relatively little traffic.

Olympics organizers and their broadcast partners have long
wrestled with how to adapt their plans for the world’s biggest athletics and
media event to an online world. The Web offers new opportunities for
advertising revenue, but also threatens to detract from the lock on Olympic
viewers long enjoyed by TV. Selling TV rights is the major source of income for
the International Olympic Committee.

The IOC didn’t sell audio and video transmissions rights for
Olympics competitions over the Web until 2000, leading some to believe it was
protecting broadcasters that feared their ratings would be cannibalized.

In many markets like the
U.S., the IOC now generally offers
the Internet and wireless-broadcast rights for the Games bundled with TV
rights, but that is beginning to change. An open tender on the online rights in
China
last year, which was eventually won by CCTV, was among the first.

The Internet is expected to play a much bigger role in the
Beijing Games. The Games will be the first to take place since the rise of
sites like Google Inc.’s YouTube and Tudou, a closely held Chinese company,
which enable easy transmission of online video. The stakes are high for CCTV,
which has struggled to translate its national broadcasting dominance into
success in
China’s
competitive and fast-changing Internet sector.

CCTV’s Olympics Web site will be a dedicated one within
CCTV.com, with a video channel supported by Tudou.com, a three-year-old start-up, and a
social-networking section supported by MySpace
China, which was launched last
April in a joint venture with News Corp. The Olympics video site — to go live
Aug. 8, the first day of the Games — will include live video, playbacks from
the Games, commentary and user-generated content. Users will be able to
interact with athletes and coaches using the MySpace China part of the site.

“We want to make full use of the interactive
characteristics of the Internet,” said Wang Wenbin, general manager of
CCTV.com, at a ceremony to announce the launch of the Web site, the theme of
which is “My Olympics.”

One question that still needs resolution, people involved
with the deal said, is how CCTV and Tudou will enforce their joint right to be
the exclusive online video broadcaster for the Games. While it has been
typically easy for traditional TV channels to keep their competition from
broadcasting the Olympics, the international, dispersed nature of the Internet
makes it tough to do so for online video.
China’s Internet is home to
numerous services that illegally broadcast copyrighted TV shows or movies —
even whole TV channels.

“At this stage nobody knows who is going to do the work
of making sure the videos are legal,” said Christopher Stokes, the chief
executive of United Kingdom-based NetResult, which helps companies enforce
sports rights.

While there is plenty of interest among Chinese Internet
users in watching and interacting with the Games online, the advertisers that
are spending hundreds of millions of dollars to advertise on CCTV during the
Olympics are unlikely to flock to CCTV’s online-video option. According to
technology-consulting firm iResearch, online video takes up 2% of all online
advertising in
China — even
though it is the fastest-growing segment of the Internet for advertising in the
U.S.

“This is the year that we are starting to see online
video really pick up…but the truth of it is, online video is only a tiny
fraction of ad spend” in China, said Kaiser Kuo, director of digital
strategy in China for WPP Group PLC’s Ogilvy Group.

Still, MySpace
China
and Tudou hope to benefit from the big publicity boost in
China they aim
to get from working with CCTV. The Games are “the best opportunity to help
MySpace
China build its
brand,” said Luo Chuan, chief executive of MySpace
China, which
licenses technology from MySpace and counts the News Corp. unit as a
shareholder. News Corp. owns Dow Jones & Co., publisher of The Wall Street
Journal.

Although details like which languages will be used on the
Web site are still being worked out, Mr. Luo expects the site to be open to
users world-wide for social networking. Athletes, coaches, journalists and
volunteers will be able to set up their own categorized profiles, he said.