Oriented Media set for China launch

KUALA LUMPUR: Oriented Media Group Bhd (Omedia) expects its online sportswear trading platform in China, to be launched by March 2016, to make substantial contribution to the group’s revenue in the future.
Director Yee Yit Yang said the group started preparations for the e-commerce business in April and is in the process of testing the business model and obtaining relevant operating license and certifications from the Chinese government.
“Because of the potential market and huge population in China, even 1% (of population penetration) is big enough. When the portal is in place, we will go on a full scale to embark on things,” he told reporters after the group’s AGM here yesterday, adding that its Chinese counterparts are confident of delivering the numbers.
In October, Omedia’s indirect wholly-owned subsidiary Fujian Accsoft Technology Development Co Ltd entered into two strategic cooperation framework agreements with Fujian Jin-Jiang E-Commerce Development Co Ltd and China-listed Xiamen Mass Entrepreneurship & E-Commerce Technology Co Ltd to collaborate in exploring the China e-commerce market.
Yee dismissed the presence of commerce giants like Alibaba.com in China, stating that they are mostly “generic” in nature.
“Our portal will be focusing more on sportswear so we become niche. We don’t want to compete head-on with the likes of Alibaba but we want to develop our own niche in terms of satisfying targeted customers. From there, we believe there will be lots of spin-off,” said Yee.
He added that there are a few players that focus on sportswear at the moment but mentioned that Omedia intends to do it in a more professional manner and is engaging a renowned e-commerce player in Southeast Asia as its technical partner.
“Our approach is going to be more professional, not fly-by-night and our Chinese parties will ensure that the products are genuine,” said Yee.
ACE Market-listed Omedia is involved in the development and provision of online gaming and edutainment related internet applications, mobile applications as well as digital/internet media consultancy services to clients.
Yee said that in the financial year ended June 30, 2015 (FY15), the group’s Malaysian operations (game and trading of software) contributed 80% of its revenue, and the remaining 20% from its China operations (IT consultancy). He also said that going forward, China’s operations will exceed Malaysia’s contribution.
He said the group has been able to derive positive revenue contribution from IT consultancy in China since embarking on the e-commerce business there in April.
“Our focus is going to be on e-commerce in China. It’s a big thing there and hopefully next year we will see some better results in terms of contribution from China and hopefully the group will be able to turn around,” Yee said, adding that its results have been improving in the last two years despite its losses.
He said despite being in the red for the past five years, it has managed to reduce losses by strict cost-cutting measures and a restructuring exercise that included disposals of loss-making and non-contributing subsidiaries.
Yee said this enabled them to streamline its business, to focus more on its games business in Malaysia and develop its e-commerce business in China.
Omedia is in the midst of a rights issue exercise that is expected to be completed in the first quarter next year.