Alas, the tinkering at struggling Next Digital (00282.HK), formerly Next Media, never stops.
Jimmy Lai’s media flagship yesterday decided to close its 25-year-old magazine Face by the end of March, according to an internal memo.
More than 100 employees, half of whom are from the magazine, will be made redundant, and many young people — its target audience — will be without their favorite read.
This is the second time in just seven months that Next Digital is shutting down a key publication after it closed gossip and entertainment magazine Suddenly Weekly last summer.
Most of its editorial staff have joined E Media Plus, a digital start-up controlled by Metro News Media owner Kenny Wee.
The decision was like a slap in the face for Lai, who has dominated Hong Kong’s gossip magazine market since the late 1990s but is now left only with his first magazine title, Next Magazine, which is also struggling.
But closing Face apparently was not unexpected.
The magazine, which includes trendy accessories rag Ketchup and its car-trading (Auto Express) and second hand-trading (Trading Express) siblings, saw a 38 per cent drop in circulation to 12,375 per week in the first half of 2015 compared with 2014.
Turnover was down nearly 20 per cent to HK$34.4 million at the end of June 2015.
While Face is not a major revenue contributor to the group, its closure suggests that Next Digital, which also operates Apple Daily and Next Magazine in Hong Kong and Taiwan, continues to suffer from a five-year sales slump.
It prompted the group to rebuild itself into a younger and lighter team and cut high-paying jobs.
Hong Kong’s magazine industry is having difficulties in the wake of a lackluster retail sector and a weak economy.
Strangely enough, there have been more magazine openings than closings. Most magazines on finance, information technology, travel and lifestyle are holding up against online media.
Next week, current affairs magazine HK01, owned by former Ming Pao group chairman Yu Pun-hoi, will make its debut, taking on Next Magazine.
So how is Jimmy Lai responding to the challenge?
As a founder of apparel retailer Giordano, Lai knows a bit about fashion and how to cope with tighter competition.
People familiar with his media strategy say Lai is retreating from the print media because he believes the industry only has a few years left before it withers.
The question is how quickly can he transform his dwindling empire?
Lai’s shift from offline to online, notably animated news, was a trailblazer but the move has yet to bear fruit.
His gaming start-up nxTomo, launched three years ago, is facing retrenchment.
Lai and other media owners are grappling with a situation in which business units are no longer able to make up for a slowdown in their corporate flagships.
Last year, Lai renamed Next Media to Next Digital, hoping the change will inject new life to the business.
But the stock continues to languish near historic lows, losing 75 percent of its value in the past four years.
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