In a unique move to break into the Chinese market, News Corp. (NWS-A) is going the route of licensing the brand and letting the local Chinese who know their market to start businesses from scratch to serve it.
“They want to avoid some of the mistakes made by the first and second waves of international Internet companies that came to China,” said William Bao Bean, a partner at Softbank China & India, a venture capital firm. “By putting a local manager in, they give the company a fighting chance. This is a very crowded area, with at least 100 companies competing in the same space that MySpace has entered.”
News Corp. is partnering with IDG and China Broadband Capital, two venture capital firms, to finance the inititiative. Essentially what this is financing a Chinese startup.
Tapped to lead the company is former Microsoft (MSFT) executive Luo Chuan, who ran Microsoft's MSN portal in China.
Murdoch's Chinese-born wife Wendi Deng helped devise the strategy and partnership and wil sit on the board of MySpace China, which the new venture is called.
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