Micro-movies offer new platform for profits

But the short movies shown there have been tailored down to 1-minute, 3-minute or 5-minute versions of the originals.

"In essence, micro-movies aren't any different from well-designed advertisements, and in the sector, the critical point lies in establishing broadcast platforms," said Yang Shuting, senior analyst with EntGroup Consulting, a Beijing-based entertainment industry consultancy.

Music copyrights offer the company another source of revenue, because the company deliberately places a theme song in every product it makes.

"We are considering expanding our business to the music industry and artists' management agencies," He said.

Since the company owns copyrights for its theme songs, and the songs have gained popularity with the general public, it could save substantially on marketing and promotion once they sell the songs in the form of disks or through paid downloads at online music websites.

"To us, it is a business in which we will never lose money," he added.

The challenges the company faces include not only disorderly competition but also potential clients' misunderstanding of the industry.

"When one of our clients finds our service useful and yields a sound return of investment, what happens next is not its rivals coming to us for a deal but its rivals going to our rivals for a deal instead," said He.

This indicates that companies think the micro-movie industry is the same as the advertising industry, which has a rule of exclusivity. But that is totally a misinterpretation for the short-movie sector in China.

He said that his business can serve rival companies in the same industry.

"Currently, China's micro-movie industry has entered 'version 3.0' times, when companies and brands blend the corporate culture or brand images into the plot in a less obvious way," said Shao Gang, deputy director of consulting for the culture and entertainment industry at Horizon Research Consultancy Group.