Background: digital Kingdom is a diversified investment holding company with operations and investments in Hong Kong, the United States, Canada, mainland China and other countries, covering media and entertainment, digital visual effects (VFX), co-production, property investment and development, and trading businesses.
On July 19, we attended the first Global and Greater China Strategy Conference held by the Digital Kingdom in Beijing. At the press conference, the company officially launched its new product Zeus and shared the company's latest global development strategy with investors. Xie an, the company's chief executive, said that the company is opening up the Greater China market and will focus on four business areas in the future: (1) special effects; (2) virtual human; (3) IP (intellectual property) copyright investment; and (4) VR.
Launch a new product. At the press conference, the company unveiled its latest ultra-high definition 360-degree VR camera Zeus. The Zeus is the company's first and only 360-degree camera so far, according to company management. The Zeus is like a metal basketball, with multiple shots on the spherical surface, with the high frame rate of 75fps and 8K pixels (UHD). Zeus will be used at the Rio Olympic Games in August. Digital Kingdom is the only company that provides 360-degree live streaming services for the Rio Olympic Games and provides related support services to the world's 22 largest television stations. By providing hardware and software support to the Olympic Games, the Digital Kingdom has access to leading television stations around the world, which is expected to bring business opportunities to the company in the future.
VR illuminates the way forward for the digital kingdom. VR-related business is one of the growth drivers of the company. In 2015, the VR-related business of the digital kingdom contributed only 7-8 per cent of revenue. However, the proportion of income is expected to increase to about 20 per cent in 2016 and more than 50 per cent in 2018.
With the launch of Zeus, the company will be able to provide a full range of VR services, from content development to hardware production. Management believes that the business will have great potential for growth in the future. With the company's hardware, creativity, pre-production and post-production teams, the company is able to produce attractive VR content.
Strategic alliance. Digital Kingdom has formed a number of strategic alliances both online and offline to enhance its special effects, VR and IP development. Amit Chopra, the company's chief operating officer, said a new series of films developed by the company in partnership with DreamWorks, such as Shrek, would be released soon. The company has 23 years of media content production experience in the United States and hopes to bring advanced technology and services from the United States to Greater China. As for online cooperation, the company signed a three-year cooperation agreement with Youku, China's largest online video platform, and the company became Youku's first and only VR content provider. Youku was founded by Victor Koo in 2006, and the company began its video content development in 2009. At present, the number of Youku users has reached 580 million. Under the agreement, Digital Kingdom will provide Youku with computer images, visual effects and 360-degree panoramic streaming and pre-video videos produced and owned by it, as well as virtual reality, augmented reality and immersive media content. the selection will be made on an exclusive benchmark, otherwise it will be on a non-exclusive benchmark. Youku will make several payments to the virtual reality content of the digital kingdom for an initial period of three years. Under the collaboration agreement, Digital Kingdom and Youku also agreed to jointly develop 360-degree panoramic live streaming and pre-recorded video and virtual reality, augmented reality and immersive media content based on Youku's activities and the content selected and allowed jointly by Youku and Digital Kingdom. And use the resulting intellectual property rights on a pre-agreed net profit basis.
Digital Kingdom has also partnered with Shanghai Film Co., Ltd. on investment in IP and cinemas. Shanghai Film Co., Ltd. has more than 800 cinemas in China, with a market share of 22%. According to Xie an and Zhang Feng, general manager of Shanghai Film Co., Ltd., the two companies will cooperate in IP-owned investment and may jointly launch VR cinemas in the future. The company also works with 300426.CH and Shixiang Media in the development of films, TV dramas, variety entertainment shows and visual special effects. Management said that several films and series with the original IP will be released in the second half of 2016, including "win the World", "Monkey" and "Mangrou".