Ruili plans digital movies to dodge internet pirates

Ruili Holdings, the flagship media business of dealmaker Charles Chan Kwok-keung, plans to invest more than $10 million to produce 30 digital movies each year in a bid to stimulate a local film industry struggling under the threat of internet downloads.

The number of locally produced movies had plummeted over the past decade, from more than 200 to about 70 in more recent years, director Chan Ka-sheung said.

Ruili has partnered with a dozen local movie directors to establish an artists' management subsidiary to support the digital business.

'[The digital movie business] should be a profitable business due to its lower cost base,' chief executive Carl Cheung said. By using hard disks, recording costs are much lower than with film tape.

The actual cost would vary depending on the cast members, but budget flexibility should encourage directors to break from appealing to the mass market and come up with new ideas, Mr Cheung said.

'Using digital media can avoid the piracy issue, as movies are stored on the hard disk and can be sent via satellite or broadband with a specific encryption code for each cinema,' Mr Cheung said. Distribution costs would be slashed. 'All digital movies we own can be distributed through all channels such as cinema, television stations and mobile phones. This can generate much more income without additional cost,' Mr Cheung said.