Video Game Empire

"Spending 50 million to help students and research, a new giant emerges in Hong Kong's electronics industry", the front-page headline of the latest issue of "New Newspaper" caused quite a stir in Hong Kong's industrial circles.

The full name of "Xinbao" is "Xinbao Financial News". It is the first financial news newspaper in Hong Kong founded in 1973 by Mr. Lin Xingzhi, the former editor-in-chief of the financial section of "Ming Pao Evening News". Although the Hong Kong newspaper has only been registered for seven years, it can only be regarded as a young generation in the Hong Kong newspaper industry. However, its professional positioning focusing on financial news is increasingly recognized by the Hong Kong business community.

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This electronic company called Dongfang Technology is only a new company established less than half a year ago, but it has risen rapidly with two arcade games called "Hong Kong Cube" and "Tank Wars".

Last Christmas, thousands of people gathered in Lisheng Cinema, and it was precisely because of the company's two new game consoles that the trial play of these two new game consoles caused a sensation among players. Since then, these two game consoles have swept the whole of Hong Kong. Since the second half of last year, nearly 100 arcade game halls dedicated to arcade games have been added throughout Hong Kong and Kowloon. Recently, there is a shortage of five cent coins in Hong Kong, which is precisely because of these two games. Due to the trend brought by game consoles.

In addition to selling well in Hong Kong, Dongfang Electronics' game consoles are also popular in the US and Japanese markets. According to an employee of the company who did not want to be named, this newspaper learned that the large amount of overseas orders accumulated has made Orient's production schedule is scheduled for the end of the year.

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Dongfang Electronics invested 50 million Hong Kong dollars this time, and launched a comprehensive cooperation with the Chinese University of Hong Kong to jointly establish CUHK-Dongfang Electronics Laboratory and CUHK-Dongfang Semiconductor Laboratory, which also shows that Dongfang Electronics is unwilling to limit itself to the game industry. This small corner of the land is ready to fully enter the electronics industry with great ambitions.

Although Hong Kong's electronics industry has developed rapidly in recent years and has become the second pillar supporting Hong Kong's economy, it also has low technical content and low product added value. In the assembly process, profit margins are very low.

In recent years, people of insight in Hong Kong have been lobbying the Hong Kong government to increase policy and financial support for emerging industries. However, the actual actions of the Hong Kong government are extremely limited. The long-awaited special scientific research support fund for the electronics industry has finally allocated only 3 million Hong Kong dollars.

This time, Dongfang Electronics, a new company that has just been established for a few months, has spent 50 million yuan in one breath to cooperate with CUHK in scientific research. The determination to invest in scientific research has undoubtedly greatly slapped the Hong Kong government in the face. The Hong Kong government collects hundreds of millions of dollars in taxes from electronics factories in Hong Kong every year. How can it use an excuse of active non-intervention to shirk its responsibilities!

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In addition to the Hong Kong Economic Journal, major newspapers in Hong Kong such as Oriental Daily, Ming Pao, and Sing Tao Daily have published the news that Oriental Electronics has invested 50 million in cooperation with the University of Hong Kong on the front pages. For the first time, the name of Dongfang Electronics Co., Ltd. was truly heard by the general public in Hong Kong.

In fact, in addition to the just-exposed cooperation between the Chinese University, the cooperation plan between Dongfang Electronics and the University of Hong Kong and the Hong Kong Polytechnic is also being discussed in detail. The investment amount will reach 30 million and 10 million respectively, and will be determined one by one in the next few months.

The fax application letters for exclusive interviews requested by various newspapers and magazines have already accumulated a thick stack of paper. The public relations department of Dongfang Electronics Co., Ltd. has prepared a comprehensive and complete set of corporate image publicity plans with a time span of up to half a year.

After screening by the public relations department, in the next few months, the current CEO Han Peng, the vice president of R&D Du Wenqiang, and Liang Ning, one of the earliest employees of the company and the current director of the arcade R&D department, will be selected. Interviewed by various newspapers.

Some of them talked about the entrepreneurial story of the company when it was first established, some talked about the marketing story of game consoles expanding overseas markets, and some talked about the company's future blueprint planning and development ambitions. All in all, all the stories they tell will show the side that Dongfang Electronics Company most wants to show to the people of Hong Kong, step by step according to the plan.

Dongfang Electronics Co., Ltd. will soon establish a dynamic, enterprising, full of vitality and high-tech enterprise image among the five million Hong Kong citizens.

At the moment, the big boss, Li Xuan, hid quietly in the ivory tower of Zhongda University, giving Han Peng and others the opportunity to focus on the flash. High-profile work, low-key talent is his pursuit.

The editor of the Hong Kong Economic Journal may not have noticed that it was Dongfang Technology Holding Company, not Dongfang Electronic Technology Co., Ltd., that signed the cooperation agreement with Zhongda. Orient Technology Holdings is a shell company established in the Cayman Islands for the sole purpose of tax avoidance.

After the financial department of Dongfang Electronics was officially established, Luo Zhiping, the chief financial officer hired from the Bank of East Asia, quickly noticed the company's high profitability. If the gross profit of ordinary electronics factories in Hong Kong can reach 20%, it is already very good. Many small factories that do OEM have a gross profit of less than 10%, while the gross profit rate of Dongfang Electronics Co., Ltd. is as high as 10%. Two hundred is a huge profit.

If such a high profit margin is not carried out for tax avoidance operations, a large amount of money will be swept away by the Hong Kong Inland Revenue Department. Tax avoidance is not tax evasion, it is completely legal. Li Xuan had the idea of ​​tax avoidance before, and he also set up an Orient Technology Holding Company in the Cayman Islands to wholly hold the Orient Electronics Company registered in Hong Kong. But he is not a professional after all and doesn't know how to operate

So under Luo Zhiping's operation, the American agents who had signed the purchase agreement directly with Dongfang Electronics Co., Ltd. all re-signed the contract to Dongfang Holding. After the Dongfang Holding Company raised the price by 20% according to the actual production cost of the arcade machine, it signed a contract for the production of arcade machines with Dongfang Electronics.

As a result, most of the profits from arcade sales are kept under the Cayman Islands-based Orient Holdings. According to Hong Kong's tax law, this part of Li Xuan's property does not need to be reported to the Hong Kong government.

The comprehensive cooperation agreement between Orient Technology Holdings and the Chinese University of Hong Kong actually includes three parts. The first part is the joint establishment of the CUHK-Oriental Semiconductor Laboratory and the CUHK-Dongfang Electronics Laboratory. UU Kanshu www.uukanshu.com is fully funded by the Oriental Company for the equipment and research funds of the two laboratories to conduct cooperative research on projects of mutual interest.

Dongfang Company has the right to screen and approve the projects applied by Zhongda University. Once the project applied by Zhongda University is approved, Dongfang Company will allocate the corresponding equipment and funds according to the research plan. The project research team is obliged to accept the financial supervision and achievement inspection of the Orient Company during the project research and development process, and the Orient Technology Holding Company will fully own the patent ownership of the research and development results.

The first phase of research and development funds of the Semiconductor Laboratory is 20 million, which is mainly used for research in integrated circuit design, semiconductor device development and research, and processor design. The first phase of research and development funds for the electronic laboratory is 25 million yuan, and priority is given to accepting polite research and development applications in computer hardware and computer software. After the signing of the contract, Dongfang Company has allocated 10 million Hong Kong dollars each to the specified bank account at the first time, so that the two laboratories can start operation as soon as possible.

The second part of the cooperation between the two parties includes the establishment of a number of scholarships in the name of Dongfang Electronics, which of course are mainly special scholarships for e-learning students. In addition, in the next three years, Oriental Company will sponsor CUHK to carry out a number of campus competitions, such as computer software design competition, computer operating system development competition, video game development competition, etc. There is also a scientific research incentive program for CUHK teachers. Dongfang Electronics will invest HKD 5 million in this series of projects.

As for the third part of the cooperation, Chinese University provides Dongfang Electronics with information and intelligence collection, especially support in patent retrieval, helps Dongfang Electronics to conduct employee training, and carries out cooperation projects such as internships for CUHK students.