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Hypebot's New Music Business Briefing For Friday December 15th, 2006

Leading Chinese Download Site Top100.cn Responds To Government Crackdown

EXCLUSIVE:  In a statement issued exclusively to Hypebot, Gary Chen the CEO of leading Chinese download service Top100.cn responded optimistically to new censorship rules imposed by the Ministry Of Culture.  We publish his remarks unedited:

"Overall I think it is a positive move.  Online music market in China need to be regulated.  Online music piracy is a huge problem in China.  The big search engine companies no matter Chinese firm Top100cn_6 and international firm like Yahoo are doing illegal search and download here in China.  The illegal mp3 search and download per day is roughly 60 million.  Ministry of Culture has not involved much in this area for past ten years.  Now, it is natural for them to have saying in this area because they have been doing censorship for physical music products in China."
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"However, they have not publishes the detailed execution plan yet.  For an example, with very limited man power, how can you censor vast number of songs in internet world ?  We are talking about millions of songs and lyrics and copyright owner authorization.  And another concern is about timing.  If legal online business would spend one month to get IFPI authentification of copyrights and then go through Ministry of Culture censorship, then piracy business will definitely beat legit business in China again." 

"As the largest legit digital music company, we are communicating with major labels and Ministry of Culture heavily now on these issues.  We all believe that it is very possible that Ministry of Culture’s new regulation and future detailed execution plan will help legit business to grow and benefit.  And Chinese_flag_2that is one of the major ways to fight piracy."

"There is one part in it about restriction of foreign companies selling music online and in mobile sphere. That happened also because certain international company use double standard (legal business in America; illegal search and download in China) in Chinese market and make government agency and value chain disappointed and lose confidence in them.  On the contrary, four China government owned telecom operators(China Mobile, China Unicom, China Telecom and China Netcom) are very very strict with copyrights in their platforms now.  for an example, you must provide copyrights contract to them if you want to provide any music services on their platform."

Just weeks ago Chen was touting a new deal for tens of thousands of indie tracks via The Orchard. At that time he told Hypebot, "This will be a great culture exchange project and people here willOrchard_21 gradually appreciate it. And Chinese government support such a project". Chen's new statement attempts to put a positive spin on recent government actions, but it is also probable that Chen suspects that the same Ministry Of Culture that censor music also read blog posts.

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