Hollywood fare attracts small but appealing audiences for advertisers in China.

Ratings don’t always equal revenue, at least for foreign content on China’s video sites, where Korean dramas and Japanese anime attract the big audiences – sometimes almost as big as those for local shows.

Of all the overseas content however, it’s Hollywood entertainment that does the most to boost the bottom line.

“Right now, advertisers prefer US dramas over Korean dramas, even though the traffic generated by Korean dramas surpasses US ones,” Wang Yi, head of international business, content acquisition and production for Chinese portal Sohu, tells Media Business Asia, speaking on the sidelines of the Asia TV Forum (ATF).

Many Chinese marketers regard viewers of US shows as an attractive demo, Wang explains, but bigger ratings drivers are also important to help protect Sohu’s market share.

Korean dramas in particular have become must-have content for China’s video sites, following the runaway success of one in particular, sci-fi romance My Love From The Star, earlier this year.

Competition to find an equally popular successor has pushed up prices for Korean entertainment to eye-watering levels, even though no show has yet to match My Love From The Star’s success. Wang is sitting it out for now. “Right now, it is almost impossible for us to recoup our investment in the current situation,” he says.

Prices for US shows are also rising, but their relatively small viewer base keeps competition and inflation in check. Foreign content will always be a nice-to-have for China’s video sites, especially in the wake of new regulations limiting how much sites can import and requiring new approvals before they can be shown.

At the same time, moves by Beijing to develop domestic production will raise the bar for home-grown fare too.

“Both in terms of volume and in terms of traffic generated by shows, foreign content remains like a dessert for us,” Wang says. “You can survive without dessert. The staple, which is domestic content, is important to us, but with dessert, life is more wonderful.”

Within that, US content, a niche proposition, becomes an amuse-bouche, he adds, a tasty addition to the meal but one that adds little sustenance overall.

A CHINESE HOME FOR HOLLYWOOD

In 2009, Sohu became the first Chinese site to buy US shows for its video portal, paying upfront for shows in a market where piracy was rife.

Five years later, the government has tightened the noose on pirate sites, and license fees for Hollywood shows are rising each year. Sohu now airs 70 day-and-date shows from the US, 20 on an exclusive basis, showing properties ranging from House Of Cards to The Simpsons to Ellen DeGeneres. 

New regulations requiring scripted shows from overseas to be vetted could squeeze early windows, but that doesn’t necessarily mean Sohu will buy less of them.

“For US drama, a big proportion of our audience watch library shows like Lost or Prison Break,” Wang says. “They are still among the most popular shows online.

“We felt day and date is really important but if you look at the data it tells us something different. Maybe we are over-exaggerating the consequences of this new policy.”