Xiao Yang, a lead actor in the popular website-produced program Old Boys, playing guitar in the studio. [Photo/Xinhua]

Websites are challenging the monopoly of TV and film companies by making video shorts and movies themselves. Sun Li reports.

Major Chinese websites are transforming the video-programming environment by making films themselves. Leading video sites such as Tudou.com, Ku6.com and Youku are among the established players making shorts or episodes of shows, while popular Internet portals like Sina.com.cn are getting in on the action too.

One of the best examples of the new website-produced shows is Old Boys, made by Youku and China Film Group Corp (CFGC), which has racked up tens of millions of video views within a month since it first premiered on the Internet on Oct 28.

"With the development of video websites, abundant capital has poured into the industry," says Wei Ming, senior vice president of Youku.

"It's a natural commercial activity for these sites to spend money producing their own programs.

"Other countries with a mature Internet industry have already set a good example that we are learning from."

In 1995, while directing commercials for the Fattal & Collins advertising agency, American filmmaker Scott Zakarin created The Spot, said to be the world's first Web series, which heavily featured product placement from the show's sponsors.

Following the same business model, in 2008, Ku6 produced China's first Web series, I Love Fantasy, attracting investment from FAW-Volkswagen Automotive Company (FAW-VW). A year later Youku shot Office Quartet, funded by Ting Hsin, a food processing company.

But the recent wave of website-produced programs features more than just collaborations between websites and corporations.

In some respects, this sea change is due to the State Administration of Radio, Film and Television (SARFT), which issued a string of policies cracking down on piracy of films and TV programs in 2009, which led to a sharp rise in copyright fees.

Some websites snapped up the copyrights of shows, transforming themselves from being a platform into a distributor; while others started to produce their own videos and own the copyrights in the first place, thereby saving money and generating future profits.

"In the current circumstances, it is inevitable that websites buy up the copyrights of some video programs," says Zhang Guowei, video director of Sina.

"But when all of us purchase the same copyrights, website content starts to look the same.

"The key to avoiding homogeneity is websites making their own programs. Only by realizing its own projects will the cyber space of videos become diversified."

Youku's Wei Ming adds the reason many websites want to make video shorts, films or serials is to break the monopoly of television companies.

"It will enable us to shift the former supply-demand relationship, as we move from the bottom of the food chain to the top," Wei says.

"China's websites will find their own way in the new marketing scenario."

Tudou, recently set up a video-making department and produced its maiden Web series, Welcome Love.

Although the budget for shooting Welcome Love was just 6 million yuan ($900,000), copyrights of the show have been sold to 11 countries and regions.

The most expensive episode is worth 200,000 yuan ($30,000).

"Besides the profits, what is remarkable is the role reversal between the buyer and the seller," says Wang Wei, Tudou's CEO.

The popularity of website-made shows has drawn some familiar names from showbiz.

Scriptwriter Ning Caishen, who is best known for his smash-hit TV series My Own Swordsmen, wrote a program for Ku6, while Hong Kong director Pang Ho-cheung served as executive producer for Sina's The Nail Trimmer, which had 20 million hits just a few days after it was broadcast last month.

The high-profile names and initial success of the films are morale boosters, but even so some websites are taking a cautious approach to the developing phenomenon.

"Where there is opportunity, there is risk," says Sina's Zhang Guowei. "We will not venture into film production with big money right now."

But with more "brands" and profitable shows, like Pang Ho-cheung and The Nail Trimmer being released in the Web-original programming circuit, he adds, there will be more enterprises that tend to emphasize videos made by websites.

"That will generate further profits and increase the number of shows produced by websites," he says.