Speaking before a panel discussion on film finance attended by a top Chinese film regulator, Rupert Murdoch said that “the promise” of China’s huge investment in screen infrastructure “has not been fully realized because market access remains so restricted.”
Murdoch has invested heavilty in China. When you are that rich, you can gamble! Murdoch invested in STAR TV, a Hong Kong-based satellite service, for more than $500 million even as the company was hemorrhaging money. Richard Li, owner, forgot to tell Murdoch that Chinese consumers were pirating the signal.
Also, Murdoch’s purchase of MySpace, with his wife, Wendi Murdoch at the reign of the Chinese version of MySpace, proved to be a dud. Murdoch recently sold his $580 Million purchased stake in MySpace for $35 Million….a bargain, in the Wall Street world!
Hopefully, the Murdochs have great luck with their latest entrée into the Chinese Market…Wendi’s first film with Fox Searchlight, along with Wendi and Rupert’s nearly $30 million commitment in Xunlei hopes to be a money maker. The Murdochs are joining Google (Nasdaq: GOOG), which holds a 2.8 percent stake, and IDG Technology, which has a 12.2 percent stake in the company. Based on information in the filing, the Murdoch’s could hold up to an 18.4 percent stake in Xunlei.
Notably, the investment is rather small compared with the Murdochs total wealth. Forbes pegs the number at about $7.7 billion, meaning the investment is the equivalent of a car payment for the average American (about $170 based on average salary of $44,000 in the U.S.).
Xunlei gains most of its revenue from online advertising, and is considered the “YouTube meets BitTorrent” amalgamation of China. Because of its business, Xunlei reported dealing with 108 lawsuits in 2009, 126 in 2010, and 10 in 2011 through March. Still pending are 33 copyright infringement lawsuits, claiming damages of $3.4 million.
The company also has services aimed at cloud storage.
Wendi’s film and the incredible interest in Chinese films by Westerners.