Government-Approved MP3 Site to Launch in China

SAN FRANCISCO (03/02/2000) - U.S. Web site creation tools company Houston InterWeb Design Inc. is teaming up with the Chinese government and a Chinese investment company to establish China's first officially sanctioned MP3 music Web site, the head of the U.S. company said yesterday.

The trio -- Houston InterWeb Design, an Internet arm of the Chinese Ministry of Culture called China Culture Information Net and Hainan Dingshen Investment Co.

Ltd. -- signed an agreement in China last week to set up a joint venture based in Beijing, Harry White, chief executive officer of Houston InterWeb Design, said yesterday in a phone interview.

To be known as Beijing Artists Online LLC, the venture plans to launch a Chinese take on MP3.com Inc.'s well-known music download Web site. In fact, an English-language version of the Chinese site will appear first within 60 days, with the Chinese-language version to debut within 120 days, White said. The company is not yet publicizing the site's address, he added.

"We're already looking at ISPs (Internet service providers) in China, in Shanghai and Beijing," White said. "We're anticipating opening offices in both cities and will have mirroring sites there too."

The reason for offering an English version first instead of a Chinese one is because the download site will initially focus on the last 500 years of Chinese music, both classical and folk, White said. The aim is to first try to interest the rest of the world in Chinese music, he said, adding that Houston InterWeb Design also plans to offer a Spanish-language version of the site.

The company is currently in advanced talks with investors regarding establishing a Spanish-language music download site which could appear within three months, White said. Eventually, the plan is for Beijing Artists Online's Web site to also feature English and Spanish music, he added.

Another facet to the Chinese agreement is that individual musicians will be able to put up their songs on the Web site, White said. As on Houston InterWeb Design's AMP3.com MP3 Web site -- http://www.amp3.com/ -- the musicians will receive a fixed royalty for every download of their music as well as a split of the advertising revenue on the site. Houston InterWeb Design's flagship software, SiteBlazer, allows anyone to create and update their own Web site without needing any knowledge of programming tools such as HTML (hypertext markup language), he added.

Although the download and use of MP3 players is allowed in China, any song posted on a Web site has to be approved by the Ministry of Culture. One of the main reasons the Chinese government was drawn to working with Houston InterWeb Design was the company's technology which contains master administration capabilities enabling the authorities to validate all the information being posted on the music download site, White said. The U.S. company already pledges to protect users from any profanity relating to any music appearing on its site.

"At present, we can validate up to 200 artists a day, each with 10 songs, so 2,000 songs per day," White said, using only five of Houston InterWeb Design's 38 staff members. "If there is a question over a song's lyrics, we can just deactivate the song, not shut down the whole of an artist's work on the site.

We'll contact the artist to ask 'what are you are trying to say here,'" he added. White didn't think that checking songs for possibly objectionable political content -- a definite issue for the Chinese authorities -- would be a problem for his company's technology.

China has an ongoing love-hate relationship with some of its pop musicians. For example, quasi-punk pop singer Cui Jian has often run foul of the Chinese government, due in part to the semi-political nature of some of his lyrics. He is best known for the song "Yi Wu Suo You," ("Nothing to My Name") which became the unofficial anthem for the Tiananmen Square student demonstrators in June 1989. Following the Chinese government's crackdown on dissent in 1989, Cui's 1990 tour of China was cancelled halfway through due to the authorities' fears that his music might provoke riots.

Houston InterWeb's negotiations started with Chinese government representatives three to four months ago, White said. The discussions advanced smoothly despite the country's ever-changing policy on Internet relationships with foreign companies. "Our company was definitely looked at very hard; we met a lot of top government officials and held deep conversations," White said. In addition to holding an unspecified stake in Beijing Artists Online, Houston InterWeb Design also will receive a significant royalty for all advertising generated through the new joint venture, he added.

White said that his company and the Chinese authorities have already signed three other agreements relating to Houston InterWeb Design's products, with announcements relating to those agreements upcoming within two weeks.

Houston InterWeb Design, based in Houston, Texas, can be reached at +1-713-627-9494 or via the Internet at http://www.hiwd.net/. China Culture Information Net, based in Beijing, can be reached via the Internet at http://www.ccnt.com.cn/.

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