Reuters Summit-Thomson to shift some business to India

PARIS, Feb 28 (Reuters) France's Thomson plans to locate more of its film post-production and DVD manufacturing businesses in India in coming years to cut costs and to serve local clients, its chief executive said on Tuesday.

''We are pretty heavily weighted towards western Europe and North America in terms of post-production labs. We need to move more to India,'' Frank Dangeard told the Reuters Global Technology, Media and Telecoms Summit.

''We need to locate some special effects in Bombay (Mumbai), some post-production in Bombay. That is work for 2006,'' he said.

Dangeard did not give any detailed targets.

''We tend to see today these countries as very significant, which is why we want to locate some R&D there. Of course what is true for India is also true for China,'' he said.

Dangeard said that Thomson had no competitors yet in China or India in these businesses.

''Eventually there will be post production from local houses in India but I think our business model today will not be totally protected but will resist quite well,'' he said.

Thomson is transforming itself from a low-margin television manufacturer into a high-margin provider of services to the media and entertainment industries.

Thomson does everything from special effects for Hollywood studios to printing and distributing films on DVD. It supplies film to cinemas, manages broadcasting networks and is a leading supplier of set-top boxes.

''We are done with the ugly work of exiting loss-making businesses and we are leader in video technologies. We are out of the tunnel,'' he said.

Thomson, which quit the loss-making TV-set manufacturing business in 2004 and sold its cathode ray tube (CRT) business in 2005, has said it will focus on reducing its cost base and on generating cash this year.

''2006 is really about running operationally the group and putting the pieces together,'' he said.

REUTERS SD DS1541