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China media and entertainment industry continues to experience exponential growth as consumer spending rises and technologies



  China media and entertainment industry continues to experience exponential
         growth as consumer spending rises and technologies converge

- Compound annual growth rate for China's media and entertainment industry
between 2010 and 2015 is estimated to be 17%

- Spending on entertainment and leisure activities in China rises 56% from
2010 to 2011

- Building strong brands, operating successful partnerships, navigating
regulatory landscape and succeeding in digital are key success factors

PR Newswire

LOS ANGELES and SHANGHAI, Nov. 28, 2012

LOS ANGELES and SHANGHAI, Nov. 28, 2012 /PRNewswire/ -- The staggering
economic growth-rate of mainland China has created unprecedented opportunities
for Chinese and global media and entertainment companies, according to
Spotlight on China, a report released by Ernst & Young, to coincide with its
Media & Entertainment Emerging Markets Executive Forum being held in Shanghai.
With China's latest Five-Year Plan moving the economy closer towards
consumption-led growth, the media and entertainment business is facing new
opportunities and challenges, as it markets its products and services to the
1.3 billion people that make up the most populated country in the world.

According to the report the compound annual growth rate for China's media and
entertainment industry between 2010 and 2015 is estimated to be 17%, which is
significantly higher than the overall forecasted economic growth of the
country. China is currently the second-largest film market in the world after
the US and is expected to exceed the US box office by 2020. China is the
largest internet market in the world and digital entertainment continues to
grow exponentially.

David McGregor, Asia-Pacific Media & Entertainment Leader for Ernst & Young,
says, "The largest media and entertainment companies in the world certainly
understand that their global strategy has to have China front and center.
Between the impact of digital adoption and the government of China easing
regulatory restrictions, both foreign and domestic media and entertainment
companies are in a position to make new inroads into this extremely promising
market."

Spotlight on China identifies several trends driving growth in China's media
and entertainment economy, including an increasing disposable income among
consumers; the convergence of networks, devices and content; the digitization
of distribution infrastructure; advertising expansion; growth of second-tier
cities; emerging business models and regulatory reform.

It also highlights the challenges facing media and entertainment companies
doing business in China, including changing consumer preferences in a diverse
marketplace, an evolving and highly competitive digital landscape, price
sensitivity, intellectual property rights infringement  and government control
and regulatory restrictions.

Through conversations with leading media and entertainment companies, the
report identified four key factors and associated best practices critical to
success in China. These are building a strong brand, succeeding in digital,
forming and operating successful partnerships and navigating the regulatory
landscape.

"The challenges for media and entertainment companies to penetrate China are
still considerable, however the vast potential of the market makes it
impossible to ignore," says John Nendick, Global Media & Entertainment Leader
for Ernst & Young. "Companies will need to understand that investing in China
is a long-term proposition, and those who can make that commitment will be in
a much better position to succeed."

Media and entertainment companies are also advised to make cultural influences
a key factor in their business strategies for China. "Companies cannot
underestimate the importance of culture in China," said Peter YF Chan, Greater
China Media & Entertainment Leader for Ernst & Young. "An understanding of the
cultural nuances across geography, age and income level is necessary to win
the loyalty of Chinese consumers."

Note: A PDF summary of the report can be downloaded at
www.ey.com/mediaentertainment. A copy of the full report is available to media
on request.

About Ernst & Young's Global Media & Entertainment Emerging Markets Executive
Forum

Ernst & Young's inaugural Global Media & Entertainment Emerging Markets
Executive Forum is an exclusive event that brings together senior executives
and CEOs from leading global media and entertainment companies. The forum is
designed to maximize idea and best practice sharing between executives from a
cross-section of M&E sectors and emerging economies on how to build and lead
successful businesses in these dynamic markets.

About Ernst & Young's Global Media & Entertainment Center

Whether it's the traditional press and broadcast media, or the multitude of
digital media, audiences now have more choice than ever before. For media and
entertainment companies, integration and adaptability are becoming critical
success factors.  Ernst & Young's Global Media & Entertainment Center brings
together worldwide teams of professionals to help our clients achieve their
potential -- teams with deep technical experience in providing assurance, tax,
transaction and advisory services.  The Center works to anticipate market
trends, identify the implications and develop points of view on relevant
industry issues.  Ultimately it enables us to help our clients meet their
goals and compete more effectively. It's how Ernst & Young makes a difference.

About Ernst & Young

Ernst & Young is a global leader in assurance, tax, transaction and advisory
services. Worldwide, our 167,000 people are united by our shared values and an
unwavering commitment to quality. We make a difference by helping our people,
our clients and our wider communities achieve their potential.

Ernst & Young refers to the global organization of member firms of Ernst &
Young Global Limited, each of which is a separate legal entity. Ernst & Young
Global Limited, a UK company limited by guarantee, does not provide services
to clients. For more information about our organization, please visit
www.ey.com.

This news release has been issued by EYGM Limited, a member of the global
Ernst & Young organization that also does not provide any services to clients.

Terence Ng
Ernst & Young Global Media Relations
+852 2629 3005
terence.ng@hk.ey.com

Steve Honig
The Honig Company, LLC
818-986-4300
press@honigcompany.com

SOURCE Ernst & Young

Website: http://www.ey.com
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