China has issued the first licence to operate an IPTV service to Shanghai Media Group. SMG is China’s second largest media group, after China Central Television.

The State Administration of Radio, Film and Television, SARFT, has licensed Shanghai station STV, an SMG subsidiary, to broadcast television, video on demand and acquired programming over an internet protocol broadband network. SMG has established a partnership with China Telecom to provide services.

An SMG director told news agency Interfax that they had started preparations for the IPTV business two years ago. He said he hoped that the IPTV business would be able to cover the whole country.

Until now, television stations and telecommunications companies were not allowed to provide converged services. Further licences are expected to be awarded by SARFT to operate IPTV services. With over 100 million internet users, a quarter of whom have broadband, but with significant growth potential, China is seen as a major market for IPTV.

Chinese telecom equipment manufacturers such as Huawei have made significant investments in IPTV. Alcatel Shanghai Bell recently opened an IPTV centre in Shanghai to provide demonstration and consulting services. “As Asian users become increasingly sophisticated, triple play is seeing huge growth potential, especially in China,” said Gerard Dega, president of Alcatel Shanghai Bell.