Animation Games Base Project

1. Animation Games Base Project Weihai Wendeng District

2. Contents • Basic condition of animation market • Market prospective of animation market • Development planning and cooperative means • Project development advantages • Contact information

3. Basic situation of animation market in China In accord with current regulation that all provincial level and vice provincial level TV station must have children’s channel. If we calculate according to that requirement, the whole country needs 5000 minutes animation program per day and 1.8 million minutes per year. However, in 2012 the total production quantity is about 0.22 million minutes, a huge shortage of supply. During the Spring Festival of 2009, the Chinese home made original animation film “Pleasant Goat and Grey Wolf—Enormous Power to Greet Year of Ox” hit 8 million RMB at the movie premier, and exceeded 30 million RMB in first weekend. It not only broke the box office record of home made animation film but also far more than the box office of the movie Kongfu Panda in 2008. Besides the film market, it also has huge derivative products market of 0.367 billion young people. Hunan Sanchen Animation Group, with its “blue cat” image, opened over 4000 derivative products franchise shops, covering 95% cities of prefecture-level.

4. Market Prospective • The animation product itself has huge market space and the market space of derivative products of animation is even bigger. The industry development and sales of children's audio & books, clothing, toys, stationery, food and so on, to some extent, depends on the condition of the emerging animation industry. • Benefit analysis of this project: It is estimated to realize 2000 minutes quantity in first three years and the cost of each minute production is 25,000 RMB, and the total project investment is 50,000,000 RMB. Conservative estimate says it sells 1000 RMB for one minute and gets back 3 million to 5 million RMB. As for the publication, 2000 minutes film can be used for publishing 50 books. According to conservative estimate, each book can help get 1 RMB copy right. If we publish 10 million sets, we can realize 500 million RMB revenue.

5. Development planning and cooperative means • Short term: Vigorously carry out the project introduction, industrialization, and realize win-win for production, study and research. Facing society and introducing animation training academy, providing animation production talents for settled enterprises. Introducing the creativity enterprise and independent creative talents studio to set up animation industry park. Set up cultural creativity industry technology share center, including network information, investment and financing, IPR, qualification certification, technology communications, exhibition and demonstration, trading platform etc. • Long term: venture capital, IPO, making the creative industry become the feature and pillar industry for the city. • Means of cooperation: whole foreign funded, joint venture, co-operative

6. General advantage • The government specially formulated the preferential policies such as “Opinion of Wendeng People’s Government on Encouraging and Supporting Animation Network Games and Software Industry ” and “Awarding Method of High Level Talents in Wendeng City”. • Wendeng Vocational Technology Education Center, Weihai Guangyuan Technicians School both open the animation major and cultivate hundreds of animation creativity talents every year, providing the back-up talents for the development of animation industry. • Combination with city image. Wendeng economy is in the key period of model transformation. Therefore, it is easier for cultural creativity industry to be combined with city brand, making cultural industry a part of city image.

7. Geographical advantage Facing South Korea and Japan across the sea, Wendeng district is the important hub that connects these two huge markets. It is also the ideal base for enterprises of China, Japan and South Korea to explore overseas market.

8. Traffic advantages Highway: Qingdao-Weihai Expressway, Rongcheng-Wuhai Expressway and No.309 National Road lead to all directions. Aviation: Weihai airport is located in Wendeng territory and has over 20 flights home and abroad. It takes only 45 minutes to fly to South Korea. Railway: Jinan-Weihai railway crosses Wendeng and it can directly access to cities such as Beijing, Wuhan and Jinan. When Qingdao-Yantai-Weihai intercity railway is built, one-hours peninsula life circle of Wendeng, Qingdao and Yantai will come true. Port: Wendeng plans to build 300,000 tonnage level national first class open port. Now two 10,000 tonnage ports have been built.

9. Environment Advantage Wendeng is located in north temperate region, with 11.5°C annual average temperature, 816mm annual average rainfall, and over 95% excellent air quality rate. With beautiful scenery, distinctive four seasons, mild winter and cool summer, it is a god-blessed beautiful place which is suitable for visiting, living and undertaking. Wendeng is located in 37°north latitude, which is called “magic latitude” by geologists. The negative oxygen ion content in the air here is so high that it is a natural oxygen bar. Living in Wendeng can help improve the function of heart and lungs, enhance metabolism, and strengthen immunity system.

10. Talents Advantage Weihai has 7 colleges and universities, such as Shandong University Weihai Branch, Harbin Institute of Technology Weihai Branch, Weihai Vocational School. The number of full-time enrolled students of above three-year college level is 60,000. It has 31 medium level vocational schools which provide talents support to the development of animation game industry.

11. Policy advantage • Wendeng district formulated the preferential policies such as “Opinion of Wendeng People’s Government on Encouraging and Supporting Animation Network Games and Software Industry” (No.45 File of Wendeng Government, 2013 ). It adopted the way of “case by case” to give preferential policies such as supply of land, administrative and institutional charges, and so on.

12. Local animation enterprise Weihai Guangyuan Animation Limited Liability Company is a production organ which specializes in animation planning and cartoon production. It mainly handles 2-dimension animation series, 3-dimension animation series, animation movie, construction cruise, products image demonstration, corporate commercials, trailers, virtual spokesman, R&D and sales of animation derivative products, academic education and cultivation of animation professional talents. It now has become one of the best animation production organs. It was awarded “Advanced Unit of Weihai Cultural System Reform and Development of Cultural Sector” “Weihai Excellent Cultural Enterprise” “Advanced Unit of Weihai Service Sector” “Advanced Unit of Weihai Spiritual Civilization Construction” “Demonstration Base of Weihai Cultural Industry”.

13. Weihai Guangyuan TechnicianSchool is the member unit of Guangyuan Film & Animation Ltd. It was approved by the Human Resources and Social Security Bureau of Shandong Provincial Office, and its school permit license number is: 3710000000021. It is provincial qualified key technical school that can recruit students as per certain plan and its enrollment is included in the planned recruit students of Technical Schools of Shandong Province. The number of animation and creative major students in this school is nearly 244. The "project teaching method" is used in teaching, which means part of the company business will be adopted to teaching.The technical personnel of the company willlead the students to "learn in the practice, practise in the learning", so that students can quickly grasp the related technology of animation production. At the same time, on one hand it can reduce the company's operating cost, on the other hand it provides a talent guarantee for follow-up development of company.

14. Contact Information • Contact Unit: Weihai Wendeng District Bureau of Commerce • Contact Add: Health Mansion, No.2 Tonghe Road, Wendeng district Weihai city • Contact Tel: 0631-8451070 • Email: 8451070@163.com