Tencent Inc yesterday said it will establish a fund of 500 million yuan (US$75.7 million) to invest in the film and TV sectors as the dot-com firm embarks on its first expansion beyond the Internet industry.
Shenzhen-based Tencent is seeking media partners for investment and cooperation opportunities, said the firm, which has more than 600 million users of its instant message service QQ.
”It’s our new cross-industry strategy and it will boost our revenue and improve our ability to compete in the long term,” Liu Zhiping, Tencent’s president, said in an e-mail statement.
The move is also in line with the national policy of Three Network Convergence, which refers to the integration among Internet, mobile and TV networks, industry insiders said.
Through the new investment, Tencent aims to transfer and move its Internet services, including video, music, weibo (microblog), e-commerce and instant message to new platforms of film and TV, it said.
Tencent has contacted sector giants including China Film Group Corporation and Huayi Brothers Media and may set up a subsidiary for the business specifically, said the report in China Business Today. This investment will comprise a part of the company’s RMB 5 billion new media investment fund, established in January, (Article in CSN2) according to the report.
China’s film market revenue is expected to surge nearly 41 percent annually to 21.7 billion yuan this year, according to research firm EntGroup Inc.
Besides direct investment, Tencent and film companies can share their experience in product development and services, said Wang Zhongjun, chairman of Huayi Brothers Media Corp. TV firms have started to integrate Internet functions on its latest products, which provides opportunities to Internet giants like Tencent, industry insiders said.
SOURCES: Shanghai Daily (14/04/2011)