Tencent to Distribute HBO Dramas, Movies Online in China

HONG KONG-- Time Warner Inc.'s HBO has signed a deal with Tencent Holdings Ltd. to distribute its TV dramas and movies through the Chinese Internet giant's online video site as the U.S. cable network tries to expand its audience in the world's most populous country.

For the network behind popular series such as "Game of Thrones" and "True Detective," the partnership could allow it to take advantage of Tencent's massive online user base and create an official distribution channel in a market where pirated videos are rampant.

For Tencent, whose online games and social networks have hundreds of millions of users in China, the deal with HBO is part of its attempt to move ahead of rivals in online entertainment, a major battlefield for China's technology firms. In July, e-commerce giant Alibaba Group Holding Ltd. announced an alliance with Lions Gate Entertainment Corp. to offer the U.S. firm's programs on the Chinese firm's set-top boxes. Xiaomi Inc., China's largest smartphone maker by shipments, said earlier this month that it will invest $1 billion to acquire TV programs.

Under the deal, Tencent Video, the Chinese company's video site, becomes the exclusive online platform for HBO shows in China, the companies said in a statement Tuesday. Tencent Video, a major video site available on PCs, tablets and smartphones, competes against Youku Tudou Inc., in which Alibaba holds a 16.5% stake.

Financial terms of the deal weren't disclosed.

Appetite for HBO programs, especially "Game of Thrones," is already big in China. Even though there are currently no authorized online distribution channels for HBO in China, many shows are available on multiple piracy video sites. Even on some major online video sites, users have posted unauthorized clips of some HBO shows with Chinese subtitles.

On Douban.com., a popular Chinese film review site, the first season of "Game of Thrones" has been reviewed by over 100,000 people, while Season 4, the current season, has accumulated 40,000 reviews. The current season has received one of the highest scores on Douban.com among U.S. TV dramas--higher than other shows that have been available through authorized online channels, such as "The Big Bang Theory."

"This partnership with Tencent Video ensures that Chinese fans will now be able to enjoy our dramas at the high level of quality they were meant to be experienced," said Charles Schreger, HBO's president of programming sales, in a statement.

Online distribution through Tencent Video will start "in the very near future," the companies said in a statement. The companies also said that "Game of Thrones" is "set to hit China audiences." Still, under Chinese rules, the programs need to be approved by the government before Tencent Video can offer them.

In September, China's top broadcasting regulator said in a statement that it must approve all foreign TV shows before they can be posted on video sites and that sites must pull unapproved shows by early next year. According to a draft of the government rules posted by local Chinese media, censors are likely to review the whole season of a foreign TV show before any episodes can air, possibly causing a delay in online distribution.

A Tencent spokeswoman declined to comment.

Tencent's partnership with HBO follows the Chinese company's another alliance with Warner Music Group. Under a deal signed earlier this month, Tencent would play a middleman role to expand Warner Music's online music distribution channels in China, including platforms that aren't run by Tencent.

Lilian Lin in Beijing contributed to this article.

Write to Juro Osawa at [e-mail]

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