China’s State Administration of Radio, Film and Television has been on the warpath recently. First, they threw a haymaker at China’s sattelite TV stations by slashing the number of “entertainment” programs allowed daily, and now they’ve fired a shot across the bow of net video and P2P streaming company PPTV for allowing their content to be streamed to third-party TV set-top boxes with internet connections, in violation of SARFT regulations.
Smart TVs and other set-top internet-to-TV streaming boxes provide a bit of a challenge to China’s government, which prefers to control content carefully, especially the content that appears on televisions, since — unlike computers — nearly everyone in China has one. Internet video companies like PPTV have a license from the government that allows them to provide streaming video services to computers but apparently SARFT does not extend that to net-enabled TV devices, and in fact had expressly forbidden Chinese video companies to support that kind of streaming. PPTV ignored that order, and now they’re being warned that another incident of noncompliance could result in heavy fines, forced restructuring, or even the termination of their license to broadcast video on the internet (which would effectively destroy the company).
PPTV’s CEO Tao Chuang has denied that the company ever supported or offered their services to the makers of these third-party set-top boxes — think HTPC but with fewer features — but boxes featuring PPTV streaming services are sold publicly by a number of different companies in electronics markets around the country. Producing and selling these devices is also apparently illegal.
The warning by SARFT is an indication that the permits held by all Chinese internet streaming companies — including Youku (NYSE:YOKU), Tudou (NASDAQ:TUDO), etc. — do not allow them to stream their videos to televisions, which will be bad news for companies planning HTPC support and Smart TV apps to increase their reach.
Some analysts have interpreted SARFT’s crackdown in this area as a move to reduce competitive pressure on CCTV, China’s state-owned television conglomerate, which has been losing viewers to the internet and to China’s satellite TV stations over the past few years. The crackdown on entertainment programs and on net-to-TV streaming may be an attempt by SARFT — which has close ties to CCTV — to ensure that on television sets, at least, the government-run channels remain unthreatened by more entertaining competitors.
[Via Sina Tech]