BEIJING, June 24 /Xinhua-PRNewswire/ -- China Digital TV Holding Co., Ltd. (NYSE: STV) the leading provider of conditional access (CA) systems to mainland China's growing digital television market today announced that its wholly-owned subsidiary, Beijing Novel-Super Media Investment Co., Ltd. invested RMB 30 million to establish a joint venture with Guangzhou Pearl River Online Multimedia Co., Ltd. (Pearl River Media), a Chinese company based in the city of Guangzhou, one of the most populous metropolitan areas in mainland China.
The new joint venture will focus on selling a variety of advertising products for digital TV platforms as well as providing other value-added services (VAS) like video on demand (VOD) and near video on demand (NVOD). China Digital TV will hold 60% of the joint venture and the remaining 40% will be held by Pearl River Media.
"The formation of this joint venture is a milestone for China Digital TV," said Mr. Jianhua Zhu, China Digital TV's chief executive officer. "It proves that we can leverage our strong relationships with our operator customers to tap into the VAS field. Building revenue sharing models with our network operators is a core strategy in our long-term growth plan. With this partnership, we are setting out on a new path and one that we expect will bring lasting growth."
Chief financial officer, Mr. Mason Xu added, "This joint venture will offer a more diversified stream of recurring revenue. We expect to see meaningful revenue contribution from this joint venture by 2010. It also provides yet another avenue for us to serve our customers, further deepening these important relationships."
The joint venture entity is the only company in Guangzhou licensed to sell advertisements on digital television screens, while they warm up and download digital content, and on electronic program guide (EPG) screens. China Digital TV also anticipates future revenue from advertisements on Pearl River Media broadband internet videos and data broadcasts.
According to official statistics, in 2007, Guangzhou's average personal disposable income reached RMB 22,469 (1 USD=RMB 6.87), making it one of the most popular cities in China for advertising spending. Given that the number of digital television viewing households in the city passed 1 million in 2007, Guangzhou is an ideal location for China Digital TV's expansion into the value-added service area.
Safe Harbor Statements
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995.
These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "may," "should" and similar expressions. Statements that are not historical facts, including statements about China Digital TV's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained or implied in any forward-looking statement.
Further information regarding these and other risks and uncertainties is included in our registration statement on Form F-1 and other documents filed with the U.S. Securities and Exchange Commission. China Digital TV does not assume any obligation to update any forward-looking statements, which apply only as of the date of this press release.
About China Digital TV
Founded in 2004, China Digital TV is the leading provider of conditional access ("CA") systems to China's rapidly growing digital television market. CA systems enable television network operators to manage the delivery of customized content and services to their subscribers. China Digital TV conducts its CA-related business through its subsidiary, Beijing Super TV Co., Ltd., and its affiliate, Beijing Novel-Super Digital TV Technology Co., Ltd. and its value-added services business through its subsidiary, Beijing
Novel-Super Media Investment Co., Ltd.
For more information please visit the Investor Relations section of China Digital TV's website at http://ir.chinadtv.cn .
For investor and media inquiries, please contact:
In China:
Eric Yuan
China Digital TV
Tel: +86-10 6297-1199 x6171
Email: ericyuan@novel-supertv.com
Helen Plummer
Ogilvy Public Relations Worldwide (Beijing)
Tel: +86-10-8520-3090
Email: helen.plummer@ogilvy.com
In the United States:
Jessica Barist Cohen
Ogilvy Public Relations Worldwide (New York)
Tel: +1-646-460-9989
Email: jessica.cohen@ogilvy.com
