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Two unlikely business partners inked a deal on Thursday that could result in the construction of a network of digital cinemas with 2,000 screens across China.

The China Film Group Corporation (CFGC), one of the country's leading film operators, announced its joint venture with the Shougang Group, China's leading steel maker, to explore the country's digital cinema market.

The new company, called China film group & Shougang digital cinema building Co. Ltd, will build new theaters that will use digital film technology to project its movies, according to the deal.

Digital film technology is not easily pirated and is more cost-effective than traditional celluloid film.

"The goal of our cooperation is to build digital cinemas across the country. We will build about 2,000 new digital screens before the end of 2008," said Han Sanping, board chairman of the CFGC.

CFGC released 39 digital films in 2006, and had total box office revenue reaching 120 million yuan (US$15.38 million).

Shougang is also actively expanding its business sphere to such areas as electronics, architecture, shipping, finance, media and culture, said General Manager Wang Qinghai.

Shougang produced 12.48 million tons of steel last year, earning revenues of 87.47 billion yuan (US$11.3 billion), statistics show.
 
(Xinhua News Agency May 25, 2007)