Chinese giant to buy Irish Upstart

Irish mobile games developer Upstart Games is to be acquired by Sun TV Shop (STVS), the online and mobile arm of China's second largest privately held media firm.

Upstart, headed by former Rondomondo chief executive Barry O'Neill, was founded in 2002. The company currently employs 30 people in its offices in Dublin, Cork, New York, and Tokyo, and specialises in developing content for mobile phones.

The firm has partnered with a number of leading Japanese games developers over the years including Konami and Sony Computer Entertainment. Its games are available via many of the world's biggest mobile operators' networks such as Verizon, Cingular and Vodafone.

Under the terms of the acquisition, Upstart Games will become a wholly owned subsidiary of Sun Media Investment Holdings, the parent company of Sun TV Shop (STVS). STVS is controlled by two of China's leading entrepreneurs, Dr Bruno Wu and his wife Yang Lan, who is one of the country's biggest television personalities.

The proposed acquisition is subject to the approval of both companies' boards of directors and to the successful completion of due diligence by Sun TV Shop.

STVS holds the electronic publishing rights for over 400 high profile magazines and newspapers spanning a wide variety of consumer sectors. It also holds the e-publishing rights and video back catalogue for Yang Lan's extensive media portfolio, and has an exclusive licence to use a 35,000km fibre network spanning 440 Chinese cities for media purposes.

Additionally, STVS holds many domestic and international rights for video, brand, information content and services in the Chinese market.

According to Barry O'Neill, discussions between Upstart and STVS began in the context of creating a joint venture to expand Upstart's distribution network into the Chinese market.

However, the two companies eventually agreed on a wider deal which sees the Irish firm's technologies being used by STVS in China while Upstart will operate as an international distribution arm for the Chinese firm.

O'Neill claims the deal is "fantastic news" for Upstart, which will be able to expand its workforce and global presence, while also gaining a foothold in China for distribution of its products. O'Neill said the firm will also have additional resources available which will allow it to expand its operations at its existing locations and establish a presence in Los Angeles, Beijing, and Shanghai.

"We've been working with Sun TV trying to extend our distribution into the Chinese market," O'Neill told ENN. "When we started working closer with them, we saw the library of media assets which they control and saw that it could be of benefit to form close links with the company.

"We have developed a number of tools and technologies which are primarily used in games but can actually be very easily applied to other content. What the deal means for us is that we can now extend our content offering. This doesn't mean that we're giving up games because that's obviously our core business but it means that we're branching out into other areas."

Overall, O'Neill said it is looking to double its workforce in "a reasonably short period of time", and added that the firm's R&D function will be significantly expanded in Dublin, as will its porting and quality assurance divisions in Cork.

Copyright © 2006, ENN