Web-TV service, such as Netflix and Hulu Plus, is growing rapidly, which has forced pay-television network HBO to release its own online-streaming services and step further into Asian market: to distribute TV dramas and movies through the Chinese Internet giant’s online video.

Globally, different from Netflix that directly launches its service in foreign countries, HBO licenses its programming to Tencent, a famous investment holding company whose services include social network, mass media, e-commerce and online games.

Its new deal with Tencent hasn’t disclosed the financial details or broadcast schedules. According to Wall Street Journal, HBO’s international business accounts for about one-quarter of the company’s $4.9 billion in annual revenue. And last year, it added 10 million users overseas, which is twice as many as HBO and Cinemas added domestically in the past decade.

Nonetheless, customers outside of the U.S. pay much less money than Americans for HBO’s programs, which, in other words, the company doesn’t generate a lot of revenue from licensing its programming.

Besides, the Chinese government censorship and local competitors – Youku Tudou Inc. and some internet-pirate sites – still make people feel uncertain about HBO’s future in Chinese market. Bloomberg reporter Xin Zhou said that a pay-to-view channel run by China’s state broadcaster CCTV aired a cut version of “Game of Thrones.” To maintain the program quality and satisfy the viewers without provoking the government seem to require a longtime negotiation among different parties.

Thus, as HBO is shifting its sights on international markets, it’s also ready to create a broadband-only service, which further disrupts the pay-television industry.

In the U.S., since it has to split the revenue with cable distributors, HBO finds it’s getting tougher to profit and dominate the market with current business model. Netflix charges subscribers $7.99 to $11.99 per month, while HBO charges $13 to $15 per month. Although Netflix’s total subscribers were not even half them of HBO, its subscriber revenue inched past that of HBO in the second quarter of 2014: $1.146 billion compared to $1.141 billion for HBO.

Also, HBO didn’t plan to offer its online services to non-pay-television subscribers until Time Warner Inc. CEO Jeffrey Bewkes announced on Oct 16, 2014 that HBO will offer its own online-streaming in 2015. This announcement immediately led TWX stock to soar 8.7 percent.

The online-streaming service will bypass the cable middleman and deliver the shows directly to the viewers. It aims to adding 10 million broadband-only users who consume video online.

HBO’s series of plans do provide an alternative for cable providers.

A policy change that will enable U.S. and Chinese citizens to visit each other’s countries repeatedly within 10 years has been announced at the conference of world leaders in Beijing; and it has been already gone into effect. Business and short-term visit visas, which used to expire after one year, will be valid for 1o years and allow a larger number of population travel back and forth between the U.S. and China.

In 2013, 1.8-million Chinese visitors came to the United States and brought an estimated $21.1 billion to the economy.  The Federal government predicts the economic impact of the loosened visa restrictions could be $85 billion by 2021, according a white house statement reported by the Los Angeles Times.

Majority of the media coverages focused on the economic spur the incoming Chinese tourists may bring to the States. Nevertheless, few wrote about the other side of the story: the policy change will also have an effect on the U.S. citizens’ visa for China. The new 10-year visas available to US passport holders will make travel to China easier for those who qualify.

A policy making process sometimes is the joint-consideration of both international relations and market demand. In the case of the 10-year valid visa, it seems like the policy shift may have something to do to with China’s inbound tourism industry. Unlike the large surplus on manufacturing, China’s tourism industry has been suffering deficit ever after 2009. The deficit pushed the local travel agencies and accommodation providers to price their service lower, sometimes even lower than the cost, to keep the business running.

It may not be just a stereotype for Chinese to picture the U.S. visitor as spenders. According to a report from BBC, the travellers from the United States were actually the No.2 travel spenders in Asia, closely followed by Germans.

At the same time, foreign tourists have slowed down their adventures in China. In the year of the 2008 Beijing Olympic Games, the number of the foreign tourists in China reached its peak at 6.15 million. Since then, the number has been shrinking, though it did bounce up a little bit in the year of 2010. The United States of America-China Chamber of Commerce (USCCC) said in a statement that the relatively high standards for L visas are one reason Beijing has seen declining tourism numbers. Programs such as 72-hour, visa-free travel to Beijing have not been sufficiently easy or welcome to make the city attractive as a destination.

The USCCC also clarified some requirements in order to obtain the new 10-year visa. In order to qualify for 10-year visas, US passport holders must have more than one-year validity remaining on their passport. And, each entry will only be good for 60 days.

“As international relations can change quickly without advanced notice, we urge you to take advantage of this new policy and apply for your China visa at your earliest convenience. In addition, if your passport expires in less than one year, we encourage you to consider renewing your passport,” said the USCCC in their website post.

It is uncertain, but worth expecting a growing number of tourists from the States coming to China for visits. As predicted by Huffington Post blogger Kathleen Peddicord, “the boom will bring more and more higher-end choices.”

However, according to Peddicord, “the biggest challenge to travel in this region is language”. It is normal that desk clerks in local small hotels, cab drivers, bus drivers, waiters, and sales speak no English at all. And it could remain a long-term challenge for the Chinese tourism industry to equip with the level of service to satisfy the international travellers.

Until 1800, China accounted for a third of world economy. In the 1880’s, the U.S. overtook China as the largest economy, a position China had for several hundreds of years. It looks like things will be returning back to “normal” in a generation’s time.

China’s growth record in the past 30 years has been incredibly remarkable, it enjoying a steady growth even during the Financial Crisis in 2008 and comprising 11 percent of global economic output in 2013. Robert Fogel, a Nobel winner in economics, forecasted in 2010 that Chinese total economic output would be $123 trillion in 2040, four times the U.S economy he predicted.

What makes China’s economy look so successful?

The first essential factor would be Chinese government making huge investment in education. Well-educated workers will turn to be highly productive workers. In China, higher education are growing steeply due to enormous state investment. In 1998, only 3.4 million students were enrolled in China’s universities. The fast change was impressive: in 2002, enrollment in higher education increased 165 percent.

Second, Chinese officials may undervalue its economic progress. In service industry, small firms often don’t report their numbers to the government and statisticians always fail to translate improvements of services’ quality into economic progress. A simple example: Chinese hospitals’ registration fee has been remaining at an unaltered ￥10 for more than a decade.

Finally, China is undergoing consumerist tendencies. In Chinese mega cities, there is already a high standard of living. At the same time, a host of policies has been set to encourage Chinese consumers’ appetite.

Everything seems to go well in China. Are there elements hindering its economic development?

“Why will growth slow? Mainly, because that is what rapid growth does.” Episodes of super-rapid growth (>6 percent) are inclined to be extremely short-lived. The median duration of a super-rapid growth episode is nine years. There are only two economies close to China’s current duration — Taiwan and Korea.

During the late 1980’s, it was widely believed that Japanese-style industrial policy, Japanese emphasis on corporate linkages and high levels of investment were keys to rapid growth. At an even broader level, it was widely believed in the early 1960’s that the Soviet Union would quite likely outstrip the United States economically.

But those forecasts were never lucky enough to be realized.

Will China be an exception? According to a prediction by The Economist, even under a moderate GDP growth rate of two percent, China will surpass the United States in 2029. Apparently, it is destined that China will lead the global economy in stead of the U.S. in few decades.

Then what will happen if China’s economy exceeds the size of America’s? Why does China’s return even matter?

A bigger economy will certainly give China global commercial domination. Fluctuations in China’s domestic demand will send ripples around the world. Market surveys will focus on China first. Leadership of international institutions will shift toward China as well. This movement includes the equivalents at that time of the United Nations, the World Bank, the International Monetary Fund, and regional development banks, etc. A more visible shift would be various headquarters moving to Beijing or Shanghai.

Geopolitically, it will necessarily alter the preeminent position that the U.S. has enjoyed since the end of the Cold War, and that Western nations have enjoyed since the 19th century.

NBA commissioner Adam Silver recently reiterated his goal of raising the league’s draft eligibility from the age of 19 to 20 in the next collective bargaining agreement.

For several reasons, this doesn’t make economic sense for the NBA, and it escapes me why the commissioner would push for such a resolution.

The current rules force high-profile players to attend college for a minimum of one season — or in rare cases like Brandon Jennings, play in Europe for a year — before qualifying for the draft.

This has lead to an influx of talent for the NCAA that wasn’t seen before the age limit was put in place in 2006. Stars like Kevin Garnett, Kobe Bryant, and LeBron James were able to skip playing in college because NBA teams were willing to bet on their talent and pay them immediately.

Proponents of the age limit will also point to notorious preps-to-pros flops like Kwame Brown as a reason athletes need to attend college to “grow” as people and players — while also arguing the incubation of talented players in college helps make them more marketable once they become professionals.

It’s flawed logic, even if it were true, because it results in the NBA propping up a direct competitor. ESPN scored their highest college basketball ratings in the network’s history last year, with 1.4 million viewers tuning in on average. Their ratings have increased six percent each of the past two seasons.

The NBA shouldn’t view this as a positive. Unlike in football, professional and college basketball are played on the same nights. They’re competing for the same viewers, and the NBA shouldn’t do anything to influence that finite market to watch a different product.

And yet, that’s what the NBA age limit does. Last year’s NCAA ratings increased because of a well documented collection of high school seniors like Jabari Parker and Andrew Wiggins going to college for one season. If NBA teams were allowed to draft them instead, there would have been much less incentive for basketball fans to tune in for random college games on ESPN during the year.

At the same time, the NBA saw its ratings slide five percent last season. The Finals rematch between the Spurs and Heat featured the most high profile American athlete, and ratings still fell one point.

The age restriction runs counter-intuitive to what the league’s goals should be: to collect the greatest amount of talent, put out the best product, and give consumers every reason to watch professional basketball rather than college.

As we discussed in class, sporting events carry more cache to advertisers now because they are live, making it more likely their ads will be watched. The increase in college ratings is more money in the NCAA’s coffers, and the NBA would be best served having curious fans tune into their product to see how the young players will fare.

It would behove the NBA financially to consider removing their age restriction entirely, rather than increasing it.

On the hill of Santa Susana Mountains sits Pico No. 4, the first production and commercially successful oil well in California, which is considered a birthplace of the state’s petroleum boom.

The well was considered the longest operating oil well in the world until it was conserved in 1990 after operating for more than 114 years, according to the Santa Monica Mountains Conservancy website.

It was drilled in 1876 near the city of Newhall by a French entrepreneur named Charles Alexander Mentry who explored the oilfield in Pico Canyon.

Within a year, Mentry drilled three wells that didn’t produce much oil, but it was the Well No. 4 that streamed a geyser to the top of a derrick.

Drilled 370 feet deep, the well producing 25 barrels per day, ultimately becoming a success that allowed Mentry to make a bigger investment  the oil production. 

The discovery of the Well No. 4 quickly led to the appearance of a new town called Mentryville, named after the well’s founder, which hosted more than 200 residents, majority of them arrived from Pensilvania’s oil fields to work for Metry, the L.A. Times reported.

But during Great Depression in 1930s when the oil production declined, residents started leaving the town.

In 1995, Chevron acquired Standard Oil of California and donated the Mentyville site to the Santa Monica Mountains Conservancy group.

Today the town is a one block village with only Mentry’s 13-rooms mansion survived. The site was turned into a National Historic Landmark in 1966.

While the California’s oil continue to gush in the Santa Susana Mountains and other fields across the state, the oil prices continue to change every day.

Almost 150 years after drilling the first Californian well, it’s still unclear where the oil prices are going.

On Dec. 3, crude oil costs $70.30 per barrel.

 

 

It seemed like a big year for Chinese pop music’s international performance. In the American Music Awards (AMAs) 2014, two international awards went to Chinese recipients. China’s talent show-grown pop singer Zhang Jie was presented with the International Artist Award; while the Chopstick Brothers, an immensely popular Chinese boy group, snatched the Best International Song award with their song “Little Apple”.

The outrage and laughter on Chinese social media began when the audience found out that the performance was only taped during a commercial break and then released online on Chinese video-sharing websites. The local audience in the States never got the chance to see the Chopstick Brothers Xiao Yang and Wang Taili danced and lip-synched on the state of AMAs. It was also found out later that these two categories of International Artist and Best International Song did not exist in past editions of the AMAs.

Speculations started both in China and on some of the U.S. entertainment news media. China’s state-run CCTV called it a “Mixed reactions to Chopsticks Brothers performance and win at AMA”. The Rolling Stone questioned: “Do the American Music Awards have a deal in China that requires goosing the broadcast with the Chinese-related content?” Rumour circulated on China’s Sina Weibo, saying the Chinese artists paid 6 million RMB (roughly equals to 0.95 million U.S. dollars) to let AMA to establish these two awards for the Chinese artists exclusively.

The speculations and rumours accumulated. Mark Rafalowski, AMA’s organiser Dick Clark Productions’ vice president of the International Division, later cleared out the rumours in an interview with Xinhua News Agency. “The AMAs have a decent history of 40 years, do you think that is what we will do? It doesn’t fit our tastes and status,” said Rafalowski.

Nevertheless, Rafalowski admitted these two exclusive awards were for certain marketing consideration: “We are glad to promote the brand of Dick Clark Productions internationally and feel proud to bring outstanding international singers like Zhang to the stage.”

The AMA Chinese content remind people of what happened earlier this year when Chinese actress Jing Tian won the Hollywood International Award from the Hollywood Film Awards. Jing was the “first-ever recipient of the Hollywood International Award”, according to  Hollywood Reporter.

Just like decades ago when the Chinese magazine People’s Movie has introduced the Oscars to the Chinese readers, the prominent awards in the industry, such as the Academy Awards, the Golden Globe Awards and the Grammy Awards still play big roles among Chinese audience. The major difference nowadays, however, would be the audience’s judgmental capability to tell the credibility of the awards that been presented to the Chinese singers and celebrities.

According to a social media poll on Sina Weibo about the AMA 2014 scandal, 64 percents of the Chinese social media users claimed that they would like to see real recognition, not just the gesture to show the interest to the Chinese market.

China has a huge entertainment content market with great potential. Last but not at least, many of the Chinese media hold strong investment capability and purchasing power.

 

So, despite the efforts that singers like the Chopsticks Brothers and Zhang Jie have put, China’s music industry is still looking for its first truly global hit. And it might be hard for any of the global awards to win the Chinese market just by adding one-time, exclusive items for the Chinese.

A $1-billion restoration project, which aims to recreate the ecosystem and develop business spaces adjacent to Los Angeles River, is becoming a gentrification plan.

The U.S. Army Corps of Engineers, on May 28, recommended approval of spending $1.08 billion on creating wetlands, restoring habitat, and building bike trails along 11 miles of the Los Angeles River. This project, also known as Alternative 20,  is a critical part of the L.A. River Revitalization Master Plan that is dedicated to transform the concrete river channel into a comfort, livable environment. Before the funding is pledged, however, real estate and land prices in some places have already risen steeply, which concerns many low-income residents.

According to Zillow.com, the median list price per square foot in Frogtown rose almost 85 percent from 2012 to 2013. And the median home value in Frogtown rose 10.2 percent over the past year to $469,300.

Frogtown, whose official name is Elysian Valley, is a tiny, isolated, lip-shaped neighborhood. Blogger Isaac Simpson described this town that “there are no retailers but the streets are packed with yard sales. There are no restaurants but tacos fry in front yard… It’s a community that supports itself in its own way.”

Now this town is about to lose its own serenity. Under the Master Plan, nonprofits, such as Friends of L.A. River is leading the river revitalization: building bike path, and cleaning up the river bed. Mayor Eric Garcetti announced a $3.2-million plan to transform Frogtown’s river-adjacent Marsh Park. And luxurious waterfront houses next to the park are midway through construction. The Frogtown Art Walk, an annual arts festival, where thousands of Angelenos show up every year, also helps promote this eco-friendly suburb to the rich.

The rising home prices in the Frogtown raises a question: is it possible for the poor and the rich to co-exist? The answer actually depends on how many jobs and how much wealth the revitalization plan can provide for the local community.

The $1-billion plan, according to a L.A. River Ecosystem Restoration Feasibility Study conducted by the Army Corps, is estimated to generate 16,833 opportunities in a variety of industries – construction, food services, real estate establishments, and wholesale trade business- and $4.68-billion labor income in total.

Also, city officials said that revamping the entire river could create recreational opportunities, such as kayaking, fishing and bicycling, and attract more than $5 billion in investment over the next 10 to 15 years, according to Los Angeles Times.

However, few officials can tell whether the river will be entirely restored in the next 10 or 15 years. Revamping the entire river, which means to un-pave the concrete banks, and preventing the floods at the same time require a whole transformation in L.A.’s urban form: building parking lots that could absorb rainfall during storm, narrowing streets to reduce runoff, or replacing neighborhoods away from floodplains.

Otherwise, the restoration of the entire river might end up like the one in the Tujunga Wash. The Tujunga Wash, according to Grist reporter Christian MiNeil, is one of Los Angeles’ first restoration site, which has a small parallel stream next to the larger paved river channel and surrounded by native vegetation and a cycling path. Melanie Winter, a watershed advocate, said the scope of the Tujunga Wash restoration project was too narrow.

Winter also said that until Los Angeles embraced those broader changes, restoration effort like the one at Tujunga Wash would end up spending more tax money to achieve less.

The billion-dollar proposal requires the federal government and local sources to share equally. According to Post-Periodical, 13 members of Congress representing districts in the Southland called on President Barack Obama on Nov. 24 to include this funding in his 2016 budget.

Where do most Angelenos go for Chinese restaurant tips? Yelp, maybe? But a local Chinese residents would probably say, nah, never, except for finding certain restaurant’s address. But what’s their source? And how do hundreds of Chinese restaurants in San Gabriel Valley get their name out?

Chihuo, founded in 2011, is a Mandarin-language website sharing food reviews, restaurant news, recipes, deals, and other recreational information like travel tips and upcoming events in Los Angeles. Within three years, the website along with its several social media accounts has attracted over 180,000 followers and become the biggest online food influencer for local Chinese community.

Chihuo stands for foodie in Chinese. Motivated by sharing food information with other foodie friends, the founder, Amy Duan, started to post food reviews on Weibo, China’s equivalent of Twitter. On June 15th, 2011, the first Weibo was sent out and it said: “ So for the very first post, let me introduce the ‘grand old man’ of Hong Kong style tea restaurant in Los Angeles—Tasty Garden. The one located in Atlantic Times Square opens until 4 a.m. Right next to AMC Theater, it’s a great place for late supper. Main dishes include Walnut Shrimp and Chicken Curry. Porridges and noodles are also highly recommended…”

To Duan’s surprise, credibility and popularity accumulated quickly. By late July 2011, barely six weeks after its launch, despite posting only around 50 reviews, Chihuo had already drawn a lot of attention and support. “Chihuo now has 1000 followers,” Duan posted. “I am so excited! SO EXCITED! EXCITED!”

As the fan base grows, Chihuo’s posts are also becoming more objective and formal. But what it’s doing keeps the same: sharing information.

Although Chihuo provides the similar service as Yelp does, its contents are mainly created by its own members rather than followers or fans. This feature hits home for many Chinese people. In general, Chinese people prefer to read reviews rather than generate them. That explains why many Chinese people have Yelp on their phones, but they still don’t trust it when finding a Chinese restaurant.

Chihuo’s success can partially owe to the rise of social media. Chihuo started from a Sina Weibo account and until now it still plays as a major platform to send new posts. Just like Twitter, followers can attach Chihuo in their own posts. As a result, there are a lot of interactions between Chihuo and followers and sometimes followers can contribute valuable food information.

Two year later, Chihuo had the website, Chihuo.org, where the food reviews are preserved permanently.

 Wechat, a free messaging and calling app like WhatsApp, also helps enhance Chihuo’s influence. In Wechat, Chihuo can send blog posts to every follower. As many Chinese people depend so heavily on Wechat to communication that they check the messages on Wechat every several minutes. So the posts sent via Wechat got circulated like virus.

 Within three years, Chihuo gets so influential that its food reviews can draw hundreds of customers to a restaurant, keeping them waiting in line for almost two hours only to try out the recommended dishes.

 Not only LA Chinese foodies take Chihuo as their go-to source, Jonathan Gold, the famous restaurant critic for Los Angels Times, also told Amy Duan that “I actually put your articles on Google translate.” And Gold once mentioned Chihuo and Amy Duan in one of his food reviews.

Businesses are also catching the trend. They provide sponsorship for publishing promotional food reviews on Chihuo. In 2013, Chihuo registered into a company and started to generate revenue by sharing information.

Recently, Chihuo launched another Northern California based website and started to cover food information in major cities like San Francisco.

Amy Duan, graduated from the communication management program in USC Annenberg, is now working full time as the CEO of Chihuo. Her goal is to spread the information sharing business and passion for food all over the U.S.

Coca-Cola does not only sell soft drinks; the beverage giant has its presence in water, energy drink, and juice markets as well. Now Coca-Cola is about to take another leap–it has announced that it will be expanding its beverage portfolio through the nationwide launching of high-end milk called Fairlife in 2015.

According to Coca-Cola, Fairlife milk will contain 50% more protein and calcium, and 30% less sugar than other milk, and contain no lactose. Coca-Cola also insists that it tastes better than regular milk.

What is interesting is that Coca-Cola is jumping into the milk business right at a time when milk sales in the U.S. are falling. Milk sales have declined by about 8% during the last decade. The premium milk which would be sold at twice the price of regular milk seems like a somewhat risky bet Coca-Cola is making.

Nonetheless, Coca-Cola seems quite confident about its new venture. At a recent conference announcing Fairlife’s launch, Sandy Douglas, the president of Coca-Cola said the company expects the premium milk to “rain money”.

It is hard to guess whether Fairlife will be a success or not. Milk market in the United States remains fragmented with only a few number of famous brands. One-third of U.S. milk sales come from store-brand milk. Coca-Cola’s breakthrough can either change the whole dynamic of the milk industry, maybe even boosting overall milk sales or become a complete disaster.

Coca-Coal’s main advantage in the new move is that it has a high brand recognition and that it has plenty of resources to support its marketing muscle. However, consumers are highly sensitive to price when it comes to milk. According to research by Nielson, people are more likely to consumers are much more likely to go for cheaper option since the perceived difference in milk is very low.Therefore, it is very hard to predict whether Coca-Cola’s use of differentiation strategy using higher price and marketing it as ‘healthier’ milk would be a success or not.

Coca-Cola has recently been investing more in non-carbonated drinks such as juices and teas, given an overall decline in soda sales across North America and rest of the world due to increasing concerns over obesity and artificial sweeteners as more people are becoming health-conscious. It October this year, it was announced that Coca-Cola has scored the lowest number in market shares in six years.

Fairlife products have already pre-launched in some states like Colorado and Minnesota. According to Steven Thueringer, dairy manager Coborn’s grocery store in Belle Plaine, Minnesota, the new milk products are “going pretty awesome”, especially being popular among younger population between their 20s to 40s.

Fairlife is scheduled to launch nationwide early next year. Will it become Coca-Cola’s next cash cow to compensate for declining soda sales?