Germany's Bertelsmann Highlights Expansion, Growth Opportunities in China

Thomas Rabe - PR Head Shot - H - 2011

CEO Thomas Rabe is counting on growth in Asia, including licensing deals for such TV formats as "X Factor," to counter sluggish momentum in Western Europe.

BERLIN - German media giant Bertelsmann is boosting its presence in China via investments in local media firms and licensing and production deals, such as the licensing of Chinese versions of hit formats X Factor and Got Talent, which are produced by Bertelsmann unit FremantleMedia.

Bertelsmann flew more than a hundred of its top executives to Beijing on Friday for the company's first-ever China Conference, highlighting the importance that CEO Thomas Rabe has put on the group's strategic shift from West to East.

"China is the second-largest economy in the world, China is a very attractive market for us," Rabe said. "The media sector is seeing double-digit growth, and the environment for foreign investment has improved in recent years." He added: "This is especially true in the sectors of digital media and education, where we plan to invest more in future – worldwide, and also in China.”

Bertelsmann's Asian Investment Fund, which it set up in 2008, now has direct or indirect equity stakes in some 20 Asian media companies with a focus on digital publishing, social media platforms, online education and e-commerce.

Rabe said Bertelsmann now employs more than 4,600 people in the media and services sector in Asia.

The CEO has admitted that Bertelsmann is behind in the digital revolution and needs to speed up the transition of its old media businesses, which include European broadcast giant RTL Group, book publisher Random House and magazine group Gruner + Jahr, to the online age.

While China is a prime focus for Rabe and Bertelsmann, the company is also looking to expand its business in the high-growth territories of India and Brazil.