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EarthNetMedia
- an international marketing company producing television content, is positioned as a
gateway between the United States and International companies to China
Business Services
Services
(ENTM – OTC)
EarthNetMedia, Inc.
222
Amalfi Drive
Santa Monica, CA 90402
Phone: 310-459-10081
Alie
Chang
President and
Chief Executive Officer
Interview conducted by:
Lynn Fosse, Editor
CEOCFOinterviews.com
April 2003
BIO:
Alie Chang
President and Chief Executive Officer
Alie Chang, as co-founder of
EarthNetMedia, Inc., serves as the Company's President and Chief Executive Officer. She
combined business acumen, leadership and creative design abilities to position
EarthNetMedia as a gateway to China for international businesses.
Ms. Chang produces and hosts
"The Art of Living" television series, as well as other life-style,
entertainment and informational programs for the Chinese and multicultural markets.
Inspiring creative individual lifestyles, "The Art of Living" TV programs
showcase innovative ideas about enhancing your home environment and give insights into
home design secrets of celebrities. "The Art of Living" series enables product
placement and soft-selling
sponsors’ products to her Chinese TV audience.
In June 1999, Ms. Chang was
featured on China Central Television, the largest television network in China, as one of
the most outstanding designers in the world today. She was the only woman and the only
residential designer featured in a group of 20 prominent design architects from around the
world, including such architectural giants as Richard Meyer, Robert Venturi and I. M. Pei.
Ms. Chang is an entrepreneur,
accomplished artist and designer. Before turning her attention to television production,
Ms. Chang has been recognized as one of the leading creative interior architects and
environmental designers. Prior to receiving her Master of Arts degree in Environmental
Design from the University of California, Los Angeles, she completed five years of a
special design program at the National Academy of Arts in Taipei, Taiwan.
Besides receiving numerous
U.S. and international design awards, her paintings have been exhibited as one woman show
at major universities such as UC Berkeley, University of Chicago, University of Hawaii and
many other major art galleries.
Ms. Chang's design and artistic abilities have long been sought by business and corporate
communities, as well as Hollywood's elite. In early 1980, Ms. Chang founded Alie Design
Inc., an architectural/interior design firm specializing in high-profile custom homes. Her
clients include such international luminaries as Rod Stewart, Larry Hagman, the former CEO
of Disney Frank Wells, and the CEO of Lorimar Production Merv Adelson. She has also worked
on the homes of former President and Mrs. Ronald Regan, as well as Hugh Hefner's
"Playboy Mansion West". Her design works are highly regarded by major
design books and magazines both in the United States and internationally.
Prior to forming her own
company, Alie joined William L. Pereira Associates in Los Angeles as a project designer.
There, she worked on projects such as the Master Plan for the University of Missouri's
four campuses, the University of Hawaii's Master Plan, and the 400-acre urban renewal
project in Queens, NY.
Ms. Chang is frequently
requested as a speaker in the US and China. Her ability and leadership in the design field
resulted in her twice being elected as co-president of Design International, an
international design organization with twenty three categories of design disciplines. Her
outstanding design achievements and contribution to society resulted in the State of
California proclaiming a special honor to her: designating August 12, 1990 as "Alie
Chang Day."
Company Profile:
EarthNetMedia, Inc., is a U.S. based multimedia and international marketing company, which
produces and distributes lifestyle and interior design/home improvement television
programs aimed at providing a gateway for businesses to enter the explosive markets in
China. EarthNetMedia has been a multimedia leader, based on "The Art of Living"
interior design and lifestyle television series, produced in Santa Monica, California and
hosted by EarthNetMedia CEO Alie Chang. This television series targets a relatively
affluent audience of 200 million viewers along the east coast of China. EarthNetMedia's
main business is to be a conduit or gateway for U.S. and international companies to
establish their presence in China and to assist firms with marketing and branding of their
products and services. ENM merchandises consumer products via product placement on
television, leading “The Art of Living” viewers to their website, providing the
Company and its shareholders great capital value.
CEOCFOinterviews. Ms. Chang, please give us a brief overview
on EarthNetMedia.
Ms. Chang: “EarthNetMedia is an international marketing
company which also produces television content. We intend to position our self as a
gateway for United States and international companies to China.”
CEOCFOinterviews:
Tell me about the TV content, what you do there and how it works in the whole plan.
Ms. Chang: “The television program that we produce is a
lifestyle, magazine format, television program called "The Art of Living". It is
based on interior design and home improvement; it is an informative entertainment and a
cultured type of program. It’s for the international market, specifically for
the United States and China. We are also bringing television programs that are
already completed that we think are suitable for China. For instance, two years ago our
Company made arrangements with ICM (International Creative Management) to bring National
Geographic Television programs to China Central Television station, which were very well
received. Now we have additional content that is in negotiation.”
CEOCFOinterviews:
Do you represent the advertisers that go with this program? How does this fit in with your
strategy?
Ms. Chang: “The program itself takes a thirty-minute
slot in China and we will have three minutes of advertising time. For that advertising
time we will obtain advertisers. Each program works differently; some have
international distribution already and have standing sponsorship. In those cases, we will
be working in conjunction with the existing sponsors and advertising companies in United
States. Sometimes we have to work with another advertising company in China in order to
package and convert the commercial into a Chinese version.”
CEOCFOinterviews:
Are there particular types of companies that are sponsors?
Ms. Chang: “Yes, we produce a home improvement design
show. We target US building material companies, home accessories and home improvement
products such as bathroom fixtures, interior finishing, home electronics, kitchen
appliances; all of these are potential sponsors.”
CEOCFOinterviews:
What is the landscape for marketing in China?
Ms. Chang: “The landscape there is very encouraging and
probably the only major growth market in the world today. China is identified by the US
Department of Commerce as the single largest market for US building material companies for
the next decade. It has a growth rate that exceeds double digits in the arena of home
building improvements.”
CEOCFOinterviews:
Why do you need to bring products from other countries into China?
Ms. Chang: “China has to produce this tremendous amount
of home improvement interior design and products and decorative including building
materials. 80-90% of the products they produce are for local mass consumption. The type of
building materials from the United States that we are marketing are environmentally
friendly, higher quality and specially designed with higher standards of building and
construction specifications. We are aiming for projects of the 200 million higher income
families along the east coast of China.”
CEOCFOinterviews:
I would imagine that is a pretty open market.
Ms. Chang: “That is correct; the reason is that in China
all housing and property used to be soley owned by the government. Only in recent years
has the housing become privately owned. Privatizing home-ownership stimulated new
homeowners to start to thinking about home improvements. If you live in government owned
housing, you don’t have to pay the rent, and you are not going to change it and
update a bathroom and remodel the kitchen because you are expecting the government to do
that. Now, everyone is taking pride in their homes, and using their savings accounts to
improve their homes to enjoy a higher standard of living.”
CEOCFOinterviews:
How do you reach the companies that should be marketing to China and how do you get them
to work with you?
Ms. Chang: “We have a several ways; we work very closely
with the U.S. Department of Commerce and they have specialty departments to assist US
companies who are interested in going into Chinese markets. If our needs are compatible,
then they could be our potential client sponsors. We also work with the NAHB
(National Association of Home Builders). It is the largest organization in the United
States with over 206,000 company members in construction, building materials,
manufacturing, building systems and design. Recently we put together a US Pavilion
at the Procurement Expo for the Olympics in Beijing which started on March 1st
and ended March 4th, 2003. The purpose of the show was to exhibit US products
to the builders and developers of Beijing. We had 22 companies with us and we were
extremely well received. The Chinese government has earmarked 60 billion US dollars in
contracts for the Olympics that should be completed before 2008. The government owned
divisions and the private sectors will coordinate with the Chinese government. We have a
very comprehensive list of the type of projects and what projects are available for bids.
CEOCFOinterviews:
Are the people in China more receptive to US companies than to European companies?
Does the US hold something special for them?
Ms. Chang: “That is a very good question. Chinese are
very fond of American products and companies and maybe it goes way back to before WWII.
The US has always presented itself as a very good friend. Now American
building materials are made available in China. American building materials have branding
and specification standards that are much higher than many other countries, so Chinese
people are very fond of US products, including Coca Cola and McDonald's and other products
than building materials.”
CEOCFOinterviews:
Are there many companies that you are competing with that provide the type of services
that you do?
Ms. Chang: “We have not come across a company that is
competing in exactly what we do because we specialize in building materials and interior
design/home improvement area. My husband and myself are experts in this field; we
have had our own companies for over twenty years. Also, my parents are from
China and I speak Chinese, which gives us a special edge. We have a special advantage in
that we have our television shows, which provide us with our media time. We stay very
strongly connected with the major television stations in China and we are using the
Internet to cross promote with the television programs. I think we are uniquely
positioned.”
CEOCFOinterviews:
Tell me a bit about the financial condition of your company.
Ms. Chang: “The financial situation of our Company is an
area on which we are working very hard. In the past year or so, the stock market has
been very slow and in the recent two months because of war concerns, stocks have slowed
even more. We are a OTCBB NASDAQ company that was approved by the SEC in the
end of 2001. We started trading in the beginning in 2002. We have had one year of trading
on the market and we think we have gained ground towards our goals and will be able to
raise the additional capital needed for all of the projects we have on our business
plan.”
CEOCFOinterviews: Is there room for expansion in the type of
companies you represent?
Ms. Chang: “We are still concentrating in the home
improvement and design arena. Diverse companies like Procter & Gamble (Procter
& Gamble Co., NYSE:PG) and Johnson & Johnson( Johnson & Johnson Inc. NYSE:JNJ)
have products for home cleaning and maintenance; they can be part of the whole program
because some of their products are very much tied into our market.”
CEOCFOinterviews:
So you have a tremendous area to work with.
Ms. Chang: “We believe so. We have an unbelievable
market, because China’s current building market is like the United States was after
World War II, and it is starting from scratch. China is at the first level and it will
continue to grow for many decades to come. Recently we were offered the possibility of 50
minutes of weekend prime-time air-time on the largest Beijing television station for our
TV show. We need to modify our show's format from that of informative design into a
lifestyle audience participation show; this change will reach a much bigger audience and
achieve better ratings. Of course, this means a little more in production cost and we are
considering that. This is a great opportunity for us because our program has been so well
received in China and they realize we offer something that they cannot do
themselves.”
CEOCFOinterviews:
Do the US companies you represent have a physical presence in China?
Ms. Chang: “Many companies that we represent do not yet
have presence in China. They are interested in the Chinese market but they heard that it
is a big and complex market and are apprehensive. We want to represent these companies and
show them the short cuts and give them the benefit of our experience, so they don’t
have to go through the lengthy process of registering and branding their company name in
China. Some very large companies are already in China like Armstrong and Owens
Corning, both of them participated in our recent Building Procurement EXPO in Beijing.
They have manufacturing plants in China now, however they cannot produce enough to meet
the demand. The demand is so great they are just overwhelmed. Armstrong, the largest
commercial flooring and ceiling manufacturer in the world, was also one of our exhibitors
and they are doing very well in China. Company's such as Kohler definitely have a
strong hold there. There are many companies like that and then there are many companies
like Boise (engineered wood products), a Fortune 500 company, who has not yet tackled the
Chinese market. In fact, Boise didn’t have much of a plan for doing so until we
approached them. They didn’t have anyone to send to China. Eventually,
Boise realized our company had so much expertise in the building materials area and we
understood their products so well that they decided to allow us to represent them at the
show. For companies who don’t have a presence in China, we believe we can help them
to formulate a plan for better cost efficiency and to gain more acceptance in the Chinese
market for their products”
CEOCFOinterviews:
How many markets are available to you in China.
Ms. Chang: “Our television program "The Art of
Living" is viewed on the Beijing television and we have plans to extend to 20 major
markets. These will be selective cities, in which American products are already selling or
which are potentially good locations for the advertisers and sponsors. We will be
syndicating a network of 20 plus major stations for our television shows, so it will be a
tremendous tool and marketing outlet for American companies who want to get into China and
brand and sell their products there.”
CEOCFOinterviews: What are your biggest challenges for the
Company going forward and how are you ready for them?
Ms.
Chang: “Our biggest challenge is to get adequate financing to move ahead with
our business plans. I think the majority of the American financing institutions are
looking at investing in China and other places outside of the United States, however they
don’t know the markets. But since China joined the WTO (World Trade Organization)
many concerns have been removed and we are in a better position to gain the support we
need.”
CEOCFOinterviews:
In closing, what should shareholders and potential investors know that they may not
realize about the company?
Ms. Chang: “I believe our shareholders will be in on the
ground level with us to tap into China's enormous market growth. Beijing alone has
allocated $60 billion dollars for 2008 Olympics. Shanghai has won the Worlds Fair for 2010
and has another $60 billion allocated for construction and improvements of its city.
So we are talking about unprecedented growth and huge amount of money to be spent.
There are another 600 cities in China that have more than five million people which
will be our second and third layer of growth, after major cities like Beijing and Shanghai
reach their full potential.”
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