21 March 2019
Ricky Wong's HKTVmall continues to bleed cash but the company believes a turnaround is not too far away. Photo: Bloomberg
Ricky Wong's HKTVmall continues to bleed cash but the company believes a turnaround is not too far away. Photo: Bloomberg

HKTV burns a Mercedes every day

What do you call a company that burns cash at a rate that would be equivalent to pushing a Mercedes Benz vehicle into the sea every day?

Some may say it is “new economy” company with big vision, but I would just refer to it as Hong Kong Television Network.

Let’s take a look at the firm controlled by maverick tycoon Ricky Wong Wai-kay, who has admitted that his online shopping and delivery business HKTVmall is losing half a million dollars a day.

Well, that’s a marked improvement from earlier when it was in the hole by HK$$1 million a day, before trimming the losses down to HK$800,000 a day last year.

Well, losing money is not unfamiliar to Wong, given his past experience as a telecoms entrepreneur who took on several biggies in a David vs Goliath battle.

Wong has a mixed track record, with some successes as well as quite a few failures. His previous venture — a free-to-air TV broadcast operation — failed to get off the ground as the government denied him a license even though he had poured tens of millions into content production.

Wong announced in March that he has given up on his TV dream following the endless wait for the government go-ahead, and that he will now devote all his energies to boosting his online mall business.

HKTV, which by the way should now seriously consider changing its name given that it no longer produces TV shows, trimmed its losses last year after some initiatives related to its online shopping operation.

The company hopes to achieve a turnaround within three years, betting that more consumers will start shopping online than in physical retail stores and malls.

There is good reason for such optimism.

Ask any receptionist in an office or housing estate about their workload and their answer would probably help you get an idea of the rising offline-to-online megatrend.

Nowadays, such workers often find themselves handing more parcel delivery orders than phone calls, thanks in large part to Alibaba Group’s e-commerce platform.

Of course, Taibao is making big money because of its vast customer base that is more than 1,000 times bigger than that of HKTV.

HKTVmall has been trying to boost its revenues and order volumes, focusing on growing its business even though it means having to put up with more losses for a while.

The firm may have found inspiration from Amazon, which has shown that it can own the cyberspace without making a single dollar of profit for many years before eventually reaping financial rewards.

But then there is only one Amazon, something we all know.

Whether HKTV will become profitable, and when, is anybody’s guess, but most Hongkongers certainly do want the local player to succeed.

It’s better to have a local brand like HKTV reap the benefits of rising online consumption, rather than Taobao or any other foreign platform, people reckon.

We can only wait and watch and hope for the best for HKTV’s e-commerce operation. 

And agree with the sentiment expressed by Szeto Wing-fu, executive director of Hung Fook Tong, a firm engaged in herbal and non-herbal products, that he hopes HKTVmall will still be around three years from now.

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EJ Insight writer

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