Warner Announces China’s First Video on Demand Service, but Is It Legal?

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Warner Bros. has signed what could be a historic deal to make its movies available to homes throughout China on Video on Demand… as long as it turns out to actually be legit.

Warner Bros. Entertainment has announced a partnership with YOU On Demand Media to provide China’s “first national Pay-Per-View and Video On Demand platform,” to launch in the summer with movies including the last Harry Potter installment, with WB president for international video and digital distribution Jim Wuthrich talking up the “millions of potential customers” that will be able to legally view movies at home as a result. But it turns out that there’s more going on here than just the headlines.

The Hollywood Reporter points out that it’s unclear whether this deal is even legal under current Chinese law, suggesting that the deal is much more complicated than initially announced:

“Sources claiming to be familiar with the Warner-YOD-CCTV-6 deal’s structure say that YOD’s contract is actually with a private Beijing-based VOD solutions company called Zhonghai, which, in turn, has a non-exclusive contract to source video content for the VOD unit of CCTV-6’s pay TV platform.”

With the Chinese media market tightly controlled by government regulators – only 20 imported films are allowed for theatrical release each year – it’s also uncertain whether or not the deal will even be approved by the authorities at this point, even with the number of specifics (How many movies will be screened? What will the paypoint be? Where will the VoD channels be available?) left open for discussion. One analyst who refused to be named seemed very cynical about the announcement, calling it “an over the counter stock looking for a boost to its price.”

Whether or not the reality turns out to be as impressive as the announcement, one thing remains: It’ll still probably be cheaper and easier to get the same movies as bootleg DVDs. Perhaps Warner should work on that market first if it wants to increase its foothold in China.

More on TIME.com:

Are Theaters the Real Winners in the VoD/DVD War?

Blip.tv Launches Hulu-Like Offering for Web-Only Series

Miramax Inks Deal with Netflix Streaming: Who’s Up for a Tarantino Marathon?