Dreamworks has had a successful relationship with China since the popularity of Kung Fu Panda. To take advantage of the the burgeoning Chinese economy, Dreamworks wants to build a studio in China. The new studio will make movies and TV shows that cater exclusively to the Chinese people. This follows a recent deal with the Chinese version of Youtube, Youku.com, to distribute the Kung Fu Panda movies. China has very strict regulations about the number of foreign movies allowed in the country each year. A China-based studio would bypass them and open Dreamworks’ product lines to a new market.