YOU On Demand, a New York-based company that’s established a significant presence in the Chinese video on demand market, will begin trading on the Nasdaq Wednesday.
The “uplisting” of the over-the-counter stock, which closed Tuesday up over 6 percent to $5.25 a share, is a milestone for the company, which was founded by World Wrestling Entertainment scion Shane McMahon and now has a 20-year contract with the Chinese government to run nationally sanctioned VOD services in the country.
Also on Tuesday, YOU On Demand announced the addition of two new members to its board of directors: veteran TV executive Michael Jackson, who once served as president of programming for Barry Diller’s InterActiveCorp.; and marketing and brand strategist Michael Birkin.
Concurrent with its listing on the Nasdaq, Marc Urbach has relinquished his title as director of the company and will now be listed as president and CFO.
Headquartering its Chinese operations out of Beijing, YOU On Demand has positioned itself is one of the more vital distribution hubs for U.S. films, with studios including Warner Bros., Disney, Lionsgate and Magnolia signing output deals with the company within the last year.
Like other foreign companies entering the Chinese market, YOU On Demand is accomplishing its goals via a joint venture — in this case with the Chinese broadcaster CCTV-6 and its pay-TV arm, China Home Cinema. Through that partnership, YOU On Demand’s VOD service is already in 3 million Chinese cable homes equipped with digital set-top boxes via carriage deals with four local cable systems. It is the leading transactional VOD service in China, controlling about 88 percent of the market.
By the end of 2012, YOU On Demand expects to be in 12 million homes with additional cable deals in place. YOU On Demand currently charges consumers anywhere from $1 to $3 per movie rental, but hopes to increase that to $3 to $5 as more Chinese consumers get used to legally paying to watch American movies. Meanwhile, the company is playing both ends of the business-model spectrum, with plans to also launch a Netflix-like subscription VOD service sometime later this year.