BOMBAY: China-focused media firm Tom Group Ltd. is interested in expanding into India’s film, publishing and online markets after a foray into mobile gaming, its chief executive said.
Tom, backed by Hong Kong’s richest businessman Li Ka-Shing, hopes to leverage off its Chinese experience to pursue a range of possible businesses in its southern neighbor from Internet portals to publishing magazines.
“Everyone talks about India and China across industries, and firms from both countries have set up operations in each other’s markets, but we haven’t had such ventures in media,” Sing Wang, Tom’s chief executive officer, said in a interview.
He said cultural and language differences, as well as the regulatory framework in both countries may be hurdles, but were not insurmountable.
The firm is eyeing India’s fast-growing online market.
“I think we’re at the tip of a very large potential market,” added Wang, who was in Bombay for an entertainment conference.
“India’s online market is still very small, with only 30 million registered Internet users — China has twice as many users — and I know mobile phones are taking off very quickly in India,” he said.
The firm, which owns 65 magazine titles, will also look at the publishing market in India, he said.
Film was another area with potential, he said, despite China only permitting 20 foreign films to be imported every year.
“I understand kung fu movies are very popular in India, and I believe Indian films can be popular in China, too,” said Wang.
Tom Group recently acquired a stake in a private Chinese film maker, one of a string of investments the firm has made in Chinese firms after the government introduced new rules to open up China’s growing media business.
“While China has some of the best hardware, it lags behind in software, or content, which is not as sophisticated as India’s”, he added.
Tom’s gaming partner Indiagames, founded in 1999, is the market leader in mobile gaming and provides content for all major Indian mobile operators as well as several global brands. It derives more than 80 percent of its revenues from exports.
“It is a small company, but it is profitable and it’s growing, and we’re very happy with our investment,” said Wang.
Tom Online Games, a subsidiary of Tom Online Inc., is due to complete buying an 80.6 percent stake in Bombay-based Indiagames for US$17.7 million by the end of April.
Tom Online Inc. is a unit of the Tom Group.
Tom Group, a former Internet startup and an associate of Hutchison Whampoa Ltd., posted a net profit of HK$860 million (US$110 million) last year. It is targeting a doubling of revenue by 2007, largely on the back of China’s fast-growing media market.