Time Warner Inks Investment Partnership With China Media Capital

Time Warner Inc. and China Media Capital (CMC) announced a
strategic investment partnership that will seek to capitalize on China's
rapidly expanding media sector and the demand for content on multiple

The companies announced the agreement at the 2013 Fortune
Global Forum in the Chinese city of Chengdu.

The partnership is another example of how U.S. media
companies are working to expand their presence in international markets and is
part of Time Warner's push to expand its international revenues.

In announcing the agreement, the companies noted that the
Chinese media and entertainment market is among the largest and fastest growing
in the world. Box-office revenue grew at 45% a year between 2009 and 2013 and is
projected to reach $4.4 billion in 2013. Meanwhile, animation revenues have
also skyrocketed by 27% a year over that period to $7.1 billion and online
video revenues have jumped by 64% to $2 billion in 2013.

The Chinese market has, however, proven difficult for U.S.
TV players in the past. After making a big push into China during the 1990s,
restrictions on exporting channels and content into China forced major U.S.
companies like Time Warner, Viacom and News Corp. to scale back some of their
efforts in the 2000s.

"This partnership with CMC and [CMC chairman] Ruigang Li
will give us a unique window into one of the world's largest and fastest
growing media and entertainment markets," said Time Warner chairman and CEO
Jeff Bewkes in a statement. "Increasing our global presence is one of Time
Warner's strategic priorities and China is one of the most attractive
territories in which we operate, but it is complex. This alliance will give all
our businesses a savvy and accomplished partner as we strive to bring our
leading brands and storytelling to people everywhere, across a wide range of

"China's media and entertainment industry is undergoing
a profound change on various fronts including technology, creativity and
commercialization," added Li. "We are privileged to be at the forefront of
these unprecedented opportunities as well as challenges. We are pleased to
forge this partnership with Time Warner, a global power of television, film and
digital content, to jointly explore innovative ways of creating premium content
for the new generation of consumers at the age of Internet and mobile, which
will further contribute to the dynamic industry development in China."

Li set up CMC as China's first media and
entertainment-focused investment fund in 2010.

Since then it has worked on a number of deals,
including DreamWorks Animation's Chinese joint venture and CMC's acquisition of
Star China from News Corp.