Hong Kong media tycoon Jimmy Lai grabbed the headlines once more after his Next Digital, owner of outspoken anti-Beijing publications Apple Daily and Next Magazine, announced on Monday it was disposing of Next Magazine and other publications in Hong Kong and Taiwan for HK$500 million.
Shares of Next Digital soared more than 15 percent last Friday amid market speculation that Kenny Wee, who has just sold his entire stake in Metro Daily, a Hong Kong free newspaper, for HK$400 million, was set to acquire Next Magazine.
Wee confirmed the rumors through a social media post: “Yes I’m ready to be the NEXT”. He later told local media he plans to expand the business in Hong Kong, Taiwan and Japan. But he didn’t give details on his business plan, except to say that Japan will be a new market for the publication.
Next Magazine, along with Apple Daily, has been a symbol of Hong Kong’s press freedom, and Lai has been a hero of sorts for standing behind his publications known for its no-holds-barred style of news reporting and commentaries, particularly those throwing brickbats at the Communist Party of China.
However, Lai’s uncompromising brand of journalism has failed to build a sustainable business model amid the digital migration trend. Beijing, tightening its grip on local affairs, is believed to have persuaded local businesses not to place advertisements on the magazine.
From a business perspective, Lai made a good decision to sell the loss-making Next Magazine and related titles at such a high price, even after some of his other publications like Sudden Weekly and Face ceased publication last year.
The new cash Next Digital is getting from the deal, HK$320 million, should be able to support Apple Daily’s operations for a period of time, given that the hard-hitting newspaper still boasts an average daily circulation of more than 100,000 copies in Hong Kong and Taiwan, and daily online traffic of more than 2 million unique visitors.
Next Digital’s management should be able to comfortably sustain the news platform with streamlined operations in both markets.
However, the transaction leaves more questions than answers, particularly with regard to the real reason and timing behind Lai’s decision.
Wee, the new owner of Next Magazine, doesn’t seem to have much experience in media operations, except for his investment in the Metro Daily Group.
Without a solid track record in the business, Wee could be suspected of being a pro-Beijing businessman whose goal is to bring Next to the fold of the pro-Beijing camp.
Wee should do more to win the support of Next’s editorial team if he wants to ensure the magazine’s commercial success and to fend off suspicions that he is out to change its political stance.
Frankly speaking, it may now be impossible for Wee to turn Next into a commercially successful publication while maintaining its fierce editorial independence. The magazine’s hard-hitting style was based on Lai’s personal beliefs about democracy and freedom, and didn’t bother at all about circulation and sales figures.
The independence that Lai gave to the journalists working at Next paved the way for its editorial success for two decades.
However, the entire Next Digital Group has been facing a lot of challenges over the past three to four years as the digital format clobbered the print media with its speed in delivering news and views to readers.
From the political perspective, the transaction indicates that Lai may take a step back in his fight for democracy as his company is making massive losses from the digital trend and a virtual boycott of his publications by advertisers. It may also mean that Next Magazine will become more pro-Beijing to woo advertisers.
Unlike other media tycoons who are mostly pro-Beijing loyalists, Lai has been an icon of Hong Kong’s democracy movement since the Tiananmen Massacre in June 1989, when he was still a garment maker selling T-shirts designed with portraits of student leaders.
Lai did not hide his anti-Beijing and anti-Communist Party stance in Hong Kong when he established Next in March 1990. The magazine was well-known for its investigative reporting on celebrities and business elites as well as its critical commentaries on Beijing authorities. In one article Lai called Chinese Premier Li Peng “a turtle egg”.
As the magazine fostered its Beijing-unfriendly reputation, many local enterprises refused to place advertisements on the publication, thus slowly depriving it of its life blood, while readers shifted to online platforms for news.
Lai’s deep involvement in Occupy Movement also contributed to the magazine’s loss of readership and advertisers as many readers and enterprises didn’t want to take a clear stand on the political issue.
Lai then started pouring more resources into a fast-food type of online news platform in a bid to attract more eyeballs, basically an unprofitable move, while reducing the resources for his print media business. Such moves inevitably led to his decision to sell Next.
It may be too early to comment on the future of Next Magazine under Wee’s ownership. But the fact is that the 27-year-old publication, in its current form, would be no more once the deal closes in September.
There is only one Jimmy Lai and one Next Magazine in the world. They simply cannot be replicated.
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