Within 10 years, China’s entertainment industry has the potential to create more new wealth than any other industry in the country. At least, that’s what Rupert Hoogewerf, publisher of the Hurun Rich List, says in a recently released report – his first — on the entertainment industry’s top moneymakers.
Hurun’s entertainment rich list isn’t what you’d expect. Instead of movie stars, models and the like, China’s entertainment industry is dominated by suits – possibly a consequence of Hurun’s definition of “entertainment,” which includes new amusements like instant messaging and online gaming in addition to traditional diversions like movies and sports.
Pony Ma, founder of Tencent Holdings, China’s largest Internet portal and provider of the popular QQ messaging service, topped the new list. Hurun calculates that 23 billion yuan, or 3.5 billion dollars, of Ma’s total worth comes from his company’s entertainment business, which generates roughly 80% of Tencent’s total market cap. Ma fell just outside the top ten on Hurun’s 2010 general list of the richest people in China and finished second to Baidu CEO Robin Li on Hurun’s latest IT industry rich list.
Just yesterday, Tencent reported a third-quarter net profit of 2.15 billion yuan, a 52% increase from same period the year before, despite an ongoing quarrel between Tencent and software company Qihoo. Two other Tencent executives are ranked among Hurun’s entertainment top 20.
In second place on the entertainment list is William Ding, the founder of Internet portal and online game operator NetEase. Ding was briefly China’s richest man in 2003, according to Forbes. According to Hurun, he is worth 14.5 billion yuan from entertainment portions of his business. Since 2009, NetEase has been the main operator in China of the popular multiplayer online game World of Warcraft. According to second quarter results, more than 90% of NetEase revenue comes from its online gaming service.
Rounding out the top three, with 10.5 billion yuan, is Chen Tianqiao, the founder of gaming company Shanda Interactive Entertainment.
While Hurun’s general China rich list this year was dominated by food and beverage barons, the entertainment sector list is stacked with online game executives at nine total, including Ding and Chen. On average, the people on the entertainment rich list are eight years younger –with a median age of 43 — than those who made the general 2010 Hurun rich list.
The film industry had some representation, including Wang Zhongjun and Wang Zhonglei, founders of the Huayi Brothers production company, who made the list largely because their movie “Aftershock,” released earlier this year, was popular at the box office. It is now China’s highest-grossing domestic film to date, hitting well over 600 million yuan in ticket sales. “I would place a lot of emphasis on the film sector in the next few years,” says Hoogeworf. “Budgets and number of films are going up each year, and revenue generated from these films are up too.”
Only two actual entertainers made the top 20: Actor Jet Li (1.9 billion) at number 11 and basketball star Yao Ming (1 billion yuan) sneaking in at number 20.
“I was surprised that the rich list was so predominantly online,” says Hoogeworf. “Entertainers didn’t make the cut. I expected a couple of kararoke bars at least.”