Paper predicament

By Fang Yunyu Source:Global Times Published: 2013-3-24 23:23:01

 

A reader reads People's Daily e-newspaper. Photo: CFP
A reader reads People's Daily e-newspaper. Photo: CFP

 

"I am with People's Daily and its website. My question is…" "I am with China National Radio and its website…" "I am with China Central Television and its website...," reporters said at a premier's press conference on March 17 in Beijing.

Increasingly, traditional Chinese media companies, including the national heavyweights, are attaching greater importance to new forms of media, such as news websites and smartphone applications, to prop up their declining profits as well as weakening influence amid a more difficult economy, analysts said.

"It is a fact that traditional media, especially papers, are on a downward trend," Chen Shaofeng, deputy dean of the Institute for Cultural Industries at Peking University, told the Global Times Wednesday.

The slowdown in the world's second largest economy and the authorities' efforts to cool down the real estate market had hit the businesses of many traditional media advertising clients, such as property companies and automakers, Chen said.

"Whether the economy is doing well or badly, it is indeed a global trend that many print media firms are dying," He Bing, deputy dean of the law school of China University of Political Science and Law, told the Global Times Thursday, noting that media companies must change and adapt in order to avoid closing.

Last year, China's GDP reached 51.93 trillion yuan ($8.28 trillion), an increase of 7.8 percent over a year earlier, and the slowest growth rate since 1999.

"Their profits are decreasing, and they are seeking ways to change," Chen told the Global Times.

Seeking solutions

"Chinese media firms, like other news media organizations, need to continue to explore effective ways of generating revenue streams, and they need to do so now," Zhigang Sun, associate director of research of The Donald W Reynolds Journalism Institute at the University of Missouri-Columbia, told the Global Times Friday.

The media firms are both diversifying their businesses and exploring new ways to capitalize on their established content and brand influence.

Chengdu B-ray Media Co, one of China's biggest newspaper groups by advertisement revenue, has been working on developing other businesses for years, such as online games, as a way to relieve the pressure on its core media business, a senior manager with the media conglomerate told the Global Times on condition of anonymity.

"We have to make a strategic transformation toward new media," said the manager.

B-ray Media also established a loan corporation last year to enhance its ability to hedge against risk.

The Shanghai-listed owner of financial newspaper National Business Daily said earlier this year that its 2012 profit slumped by 27.4 percent year-on-year to 286 million yuan ($46 million).

The company attributed the profit drop mainly to rising costs, increasing difficulties in expansion, and new businesses that have not been able to generate profits yet.

Guangdong Guangzhou Daily Media Co, another large newspaper group, also saw a slump in 2012 profits, which fell by 26 percent year-on-year to 275 million yuan.

Meanwhile, Zhejiang Daily Media Group Co disclosed in its latest financial report that its profit for the first three quarters last year was 166 million yuan, a drop of 4.6 percent year-on-year.

Facing the difficulty, Guangzhou Daily Media braced itself to diversify its business categories, acquiring several other media companies last year.

At the same time, many other companies in the sector are looking at new methods to leverage their traditional influence, such as organizing forums and developing news apps.

"More young people are using the Internet or smartphones for news, which has drawn away a large amount of traditional media clients," noted Chen from Peking University.

"Traditional media firms have to find a proper business model for their new media enterprises. Charging online readers should be promoted gradually," Cao Sanxing, deputy director of the New Media Institute at the Communication University of China, told the Global Times Thursday.

Sun said Chinese newspapers need to learn how to monetize their quality journalism by knowing what their audience members want to know, providing the kinds of news that are preferred, and presenting the news in a way that is liked by audience members.

"Moreover, developing new media will offer other business opportunities, such as e-commerce," said Cao, adding that although he does not think that print media will die out, new media will dominate the market sooner or later.

New media success

Nowadays, as readers of newspapers and magazines are getting older and have declining purchasing power, the influence of the new media will rise, noted Chen.

When Apple Inc's iPad came to the Chinese mainland two years ago, domestic companies like Caixin Media and Beijing Evening News soon developed special apps for their magazines and newspapers.

"The iPhone let Chinese people know how powerful a phone can be for the first time," and with the advent of the iPad, which is more suitable for reading, there will be bigger room for traditional media content providers to explore, Zhao Weiyi, director of the media operations department of technology support firm Viva Media, told the Global Times in an earlier interview.

Now almost all media companies have iPhone, iPad and Android versions available for free, for now.

Excellence in journalism requires investment, and many foreign media firms have begun to charge for their online content, including the Financial Times, The Wall Street Journal and The Times.

Although no big Chinese media firms have yet followed suit, Cao said that in the future Chinese users will adapt to paying for online content, and recognize the value it contains.

"The thing that's dying out is not the media, just print-based media," said Cao.

Yet there is still some positive news for traditional print media.

According to a recent study by European organization Print Power, consumers say they continue to have more trust in advertising in printed media.

When asked how much trust they attach to advertising in various forms of media, consumers gave magazines and newspapers a score of 63 percent, compared to 25 percent for online publications. 



Posted in: Insight

blog comments powered by Disqus