ERG Media enjoys a booming business importing and exporting entertainment media to and from China.
|PHOTO COURTESY OF ERG MEDIA HOLDINGS
Eleven years ago, when China-born Li Chuan was in New Zealand, he observed a strange phenomenon. “There was a new community of Chinese immigrants, and they were not into mainstream TV. This created a huge demand for VHS cassette rentals. Seeing that gave me the idea to bring Chinese content to Singapore, to serve the Chinese consumers here.”
The next year, in 2000, Li founded ERG Media Holdings Pte Ltd. Starting with content such as drama serials, the company soon progressed to bringing China Central Television channels CCTV-4 and CCTV News to Singapore, Malaysia, Indonesia and Thailand. ERG Media Holdings also has an office in Jakarta.
From there, for ERG to enter into the China market was only natural.
“We started an office in Beijing in 2001 to source for more content, and people started to approach us with offers. We felt that there might be a demand in the media market there, which had just opened up.”
In 2002, ERG Media was founded. As a program distributor, it focuses primarily on animated children’s programs. A year later, its sister company, ERG (Beijing) Film Corporation Limited was formed to bring independent films onto the Chinese silver screen.
The company has so far brought over 50 foreign films into China, past stringent censorship regulations. Alongside theatrical releases, ERG Films also works with broadcasters to release films on DVD. Its acquisition team sources for new content from major film festivals in markets all around the world to bring to China. Some examples of these films include: Asterix And The Olympic Games (France), Donkey Xote (Spain/Italy) and The Counterfeiters (Austria/Germany).
ERG Films works closely with the China Film Group and Huaxia Film to distribute its films. Internationally, it imports films via large companies such as EuropaCorp, Studio Canal and BetaFilm.
Li, who is chairman of all three companies, described his strategy as “bringing quality content to entertain audiences”. This consumer-centric approach has reaped rich dividends for ERG.
“I think our biggest achievement is that currently, we are one of the leading independent distributors in China for foreign films, with a substantial market share. The Chinese market is fast opening up and developing.”
China’s film industry is projected to reach US$900 million in profits this year (according to online market resource company Research and Markets), and continue to grow to almost US$2 billion by 2015. This growth is fueled particularly by the accrual of wealth and increase in entertainment spending by Chinese consumers.
“ERG Film has a substantial minority shareholder which is a Chinese state-owned company. We consider this investment a vote of confidence in us.” Currently, Li is looking to new media as an avenue for expansion, particularly Internet Protocol Television, which uses the Internet to distribute content, rather than traditional cable, satellite or radio frequency broadcasts.
However, today’s successes did not come without sacrifice.
“I had no experience in the media business; I learned my lessons the hard way,” shares Li. Also, the frequent commute between Singapore and China is hard on the whole family. Li has a 5-month-old daughter, Faith with his wife, Angeline.
“Because of the nature of my business, I have to travel frequently while my wife and baby daughter are in Singapore. We sacrifice our time together.”
The quick expansion has also been a challenge for the company. “Three years ago, we tried to produce a film with a US$10 million budget, but we failed. The budget was too big and we didn’t have enough experience. It was quite a big setback for us. After that, we decided to focus on distribution rather than production.“
Still, Li has big plans for his companies for the next decade.
“ERG Media started as a company doing content distribution, focusing on animation, particularly children’s shows. In the future we hope to focus on channel management rather than content distribution. We’re looking at taking over some animation channels, managing them, and bringing them to the international market.
“ERG Film is a very traditional film distribution business. We have plans and strategies to make it the largest film company in China.”
Despite the fact his business is in China, Li still carries a torch for Singapore. “I hope to come back to Singapore as a film distributor one day.”