Chinese smartphone maker Oppo has been in talks with Indonesian news aggregator startup Baca for a potential investment, people familiar with the matter told KrASIA today.
Jimmy Sie, co-founder and chief operating officer of Baca, originally wanted to launch the idea in China in 2014, but was warned of the intense competition in China’s startup ecosystem and that the Chinese market was already saturated.
“The Chinese market was not a good market to thrive in because it is too saturated and hard for startups to begin with,” Sie said in a previous media interview.
Felt discouraged, Sie turned his eyes towards Indonesia, due to the country’s huge population size and the Indonesian’s thirst for content against a fast rising mobile proliferation.
Baca utilizes technology to aggregate news and machine learning to understand its users’ reading patterns to feed relevant news for the readers’ taste. There are low barriers to entry to read the news as users do not have to set up an account and the firm’s primary source of revenues is via ads.
The firm claimed one million daily active users in Indonesia back in 2016. The app collects between 20 to 25K articles from 500 publications, despite stiff competition from local firms such as Kurio. Still, Baca has global ambitions, eyeing the massive market of Brazil.
This could potentially be an opportunity for Baca’s access into China even as Oppo ventures into mobile news app in Indonesia.
Taking a page from Xiaomi
Headquartered in China’s southern city of Dongguan in Guangdong province, Oppo, remained very dominant in its home turf, leading the pack with 18.52 million shipments for Q1 this year, according to Sino Market Research, a Beijing-based market researcher.
However, the company cannot repeat its feat in overseas markets, and is surpassed by its Chinese rival, Xiaomi, where the latter has been enjoying successful expansions in India, Indonesia and now Western Europe.
In addition to the hardware business, Xiaomi is also aggressively replicating its ecosystem play outside of China.
In this March, Beijing-based Xiaomi announced that it’d invest Rs 6,000-7,000 crore in around 100 startups in India to enhance its hardware and software ecosystem, while most of the investees would be from mobile app tech area.
The logic here is, by investing into promising apps, Xiaomi could leverage on the popularity of its cell phones to help promote and grow these apps, which will, in turn, enrich Xiaomi phones’ functionalities and experience.
By investing into Baca, possible synergies could be reaped between the mobile news app and Oppo smartphones sold in the Indonesian market.