TAM seeks more serious audience

Animation event moved to later date

DON SAMBANDARAKSA

Thailand Animation and Multimedia 2007 will be relaunched as an industry-focussed event towards the end of this year as part of Software Industry Promotion Agency (Sipa) efforts to provide support and funding for Thailand's software developers in 2007, according to Thanapong Na Ranong, Sipa's newly-appointed director for business development.

''We no longer wish TAM to be associated with Children's Day. It needs to become a serious business event,'' he said.

Thanapong, until recently director for broadband applications at Shin Satellite, said that his experience at ShinSat had taught him that people often mistook the users of services as the purchasers. For instance, while animation is used heavily in real estate presentations, it is never the real estate developers that make the purchase decision, rather it is the advertising agencies that the developers hire _ and these are the people the animation houses should focus their efforts on.

Thanapong said that Sipa would be announcing a Thai ''animation mega-project'' this year that will engage much of the industry, from the creative character designers to visual effect houses and increase awareness and introduce new opportunities throughout the industry.

CAT Telecom, a state enterprise under the ICT Ministry, is also looking towards populating its new data centre with good Internet-related ideas. For instance, anyone with a good learning management system or courseware can connect with schools across the country that are CAT Telecom customers via the www.catcommerce.com portal.

Sipa director Dr Arvuth Ploysongsaeng later said that the sofware agency would be holding many overseas road shows in cooperation with the Department of Export Promotion and Thai embassies scattered across the globe.

The Office of SME Promotion told the gathered IT sector entrepreneurs that of nine-billion baht earmarked for their technology fund since 2004, only 1.5 billion had so far been allocated. Of this amount, just seven IT companies have been approved for funding in two years.

This was mainly because software companies were small, ad-hoc operations and did not stand up to formal audits, though they were working with Sipa and Software Park to help on this point.

However, the news from SME Bank for 2007 was much better. Up until now, it was practically impossible for any small IT operation to get a loan from the SME Bank, as even a five million baht loan would need to be audited by chartered accountants on the Ministry of Finance's ''A-list'', essentially passing the same scrutiny as the country's largest mega-projects.

This would mean between 300,000 to 500,000 baht a year in recurring accounting fees, which made little sense on a five million baht loan, according to SME Bank's Trairat Treerattanapan.

A new list of approved and much cheaper accountants is currently being finalised and should be bought online in 2007. He said that because of these Finance Ministry rules, the SME Bank had previously had to focus on the medium-sized enterprises or even large enterprises.

That said, SME Bank is one of the few banks in Thailand that are happy to take intellectual property in the form of source code as collateral for a loan. Rather than being the first port of call for IT start-ups, Trairat said that it would be much more realistic to approach the SME Bank once the company is ready for expansion, as they are able to invest up to 100 million baht for up to 49 percent of a company.

The Ministry of Science's National Innovation Agency was also present and said that they took a very different view of investment. Rather than an accounting-led view, the NIA is giving out up to five million baht to projects and start-ups that feature innovation _ the Ministry of Science prefers lab results over financial spreadsheets.

The five million baht can be as an outright grant or put towards interest from a commercial bank, which means up to 25 to 30 million baht in loans over three years. In 2006, a budget of 150 million baht was approved, of which 100 million was successfully allocated to 80 individual projects.

The Board of Investment said that the BoI did not have any money to give away, but rather could help save companies tax and red tape.

Three categories of software are targetted for promotion _ enterprise software, digital content and embedded software.

''It's much easier than getting a loan,'' the BoI representative joked, saying that the paperwork for BoI approval can today be initiated at Sipa, which will help prepare and vet the documents.

One problem was that the BoI requires a minimum investment in machinery. Many BoI companies go out to buy lots of computers each year to meet the one million baht minimum threshold. However, a long-term office rental contract, as long as it is at least three years, also counts towards the one million minimum machinery investment.

Asked if a hypothetical animated blue elephant would qualify for support by the SME Bank, NIA and BOI, the BOI said that intellectual property in a blue elephant is unfortunately not considered an investment in their eyes. However, the BOI would support a large investment project which needed computers and software to develop a blue elephant from scratch.

Bangkok Post
Wednesday January 31, 2007