AOL Time Warner signs deal to broadcast in China

BEIJING -- AOL Time Warner Inc. announced a landmark deal Monday that will make it the first foreign television broadcaster in China, in exchange for carrying Chinese state television's English-language channel on U.S. cable systems.

AOL Time Warner is getting a foothold in the rapidly developing Chinese television market, which foreign broadcasters are eager to break into. Rupert Murdoch's News Corp. is also trying to negotiate a similar arrangement with China, where nearly every household owns a television and viewers number in the hundreds of millions.

The deal is also a turning point for China's communist officials. They regard television as a key propaganda tool and strictly control it, though millions of Chinese already watch broadcasts from abroad on illegal satellite dishes. Beijing appeared to be willing to relax those controls slightly in exchange for getting access to American audiences.

AOL Time Warner relies heavily on the U.S. market for its media businesses -- which include Time magazine, HBO and CNN -- and it has been stepping up its efforts to expand overseas.

Trading channels

Under the terms of the deal, AOL's Chinese-language channel CETV would be carried on cable systems in the southeastern province of Guangdong beginning next year. It will be the first time that a foreign broadcaster reaches Chinese audiences with the government's approval. CETV, based in Hong Kong, already is seen in Taiwan, Singapore and elsewhere in Asia.

CETV's programming is a mix of Chinese entertainment shows, cartoons, game shows, movies and sports. It also carries versions of some U.S. shows like "Miami Vice" dubbed into Chinese.

Tricia Primrose, an AOL Time Warner spokeswoman, said the channel carries no news programs. She had no details on whether the agreement includes provisions for Chinese censorship of CETV programming.

In exchange, the Chinese government's English-language channel 9 will be seen by American audiences in New York City, Los Angeles and Houston. Financial terms of the deal were not disclosed.

Gerald Levin, AOL's chief executive, said in a prepared statement that the deal was a "significant step in the growing relationship between AOL Time Warner and the people of China."