[Depth] Several ways to die in Hong Kong paper media

"The paper media is dead!" This exclamatory sentence has gradually become a declarative sentence in Hong Kong, and it is no longer a topic of academic discussion. In the past week, many Hong Kong people who used to buy a newspaper in the morning to "sigh" their morning tea suddenly sighed, and it was hard to see "Xin Bao" and "Cheng Bao" in convenience stores any more.

Without any warning, the 56-year-old New Newspaper suddenly announced at 5: 00 pm on July 11 that it would stop publishing on the 12th and officially end its business. The newspaper published that day became out of print, and 130 employees were laid off immediately.

This traditional newspaper, which experienced the ups and downs of Hong Kong’s newspaper industry, ended up closed, although it was taken over by Emperor Group and Macau gambling king Stanley Ho. That night, all the news content on the homepage of the New Newspaper website was deleted, and the website page directly jumped to the announcement of publication suspension. The announcement said that thanks to readers’ support.

New Newspaper was founded on October 5th, 1959, and was founded by Bin Luo, a famous journalist. In the early days, it attracted readers by horse racing news, serial martial arts novels and other contents, and once won the fame of writers such as Ni Kuang and Yi Shu. Yang Shoucheng, chairman of Emperor Group, bought Newspapers in 1992, and Stanley Ho, the gambling king of Macau, became a shareholder in Newspapers in 2009.

Why did New Newspaper, which grew up with a generation of Hong Kong people, close down? "New Newspaper" wrote in the closure announcement, "With the emergence of free newspapers, the sales volume of traditional newspapers has dropped sharply in recent years, and readers’ habits of reading newspapers have changed. The newspaper has made many appropriate reforms under feasible methods and budgets, but it is still in a state of long-term loss."

Gu Yaokun, the president of New Newspaper, felt sorry for the closure. He lamented that it was very difficult to run newspapers all over the world, and young people in Hong Kong lost interest in paper media. Gu Yaokun said that the New Newspaper had been reformed many times, hoping to reduce costs and change the long-term loss situation, but the results were very poor, and the decision to close down was heavy and difficult.

"Due to the sharp drop in advertising revenue, we laid off 40 employees in October last year, but now fewer and fewer people in Hong Kong read newspapers." Gu Yaokun revealed that the annual loss of New Newspaper is calculated with 8 figures (HK$ 10 million).

Gu Yaokun also felt that even the most famous horse racing news in New Newspaper, many horse racing fans have switched to using tablet computers to check horse information in the racecourse instead of turning to newspapers.

In less than a week, the Hong Kong media haven’t finished singing the elegy of the New Newspaper. On July 16th, Cheng Bao, which has been founded for 76 years, suddenly announced that it would suspend publishing the printed edition for the next two days, and it is unknown when it will be reissued.

A reporter from Chengbao told the interface journalist that in fact, Chengbao has long been rumored to have closed its business, but so far wages have been paid normally, and the electronic version of the newspaper still has to be published, so there is no big impact, and employees still need to go to work normally.

According to the interface journalist’s understanding, Chengbao’s publication was suspended mainly because its parent company Chengbao Media Group was liquidated. Chengbao Media Group was suspended on the Hong Kong Stock Exchange 10 years ago and was forced to liquidate recently. KPMG was appointed as the provisional liquidator by the Hong Kong court on July 15th, and the newspaper operation account of Chengbao was frozen on the 16th, which made Chengbao unable to pay the printing fee.

Chengbao is "older" than Xinbao, and was founded by He Wenfa and others in 1939. In 1950s, Cheng Bao was once the highest-selling newspaper in Hong Kong, but after the newspaper price war in 1990s, its sales volume declined seriously, and it was transferred many times after 2000. According to the 2014 interim financial statement of Chengbao Media Group Co., Ltd. (hereinafter referred to as Chengbao Media), the company’s net debt is about 480 million Hong Kong dollars (about 385 million yuan).

Interface journalists inquired that Chengbao Media announced its results in the third quarter of 2014 in February 2015, with a turnover of 12.05 million Hong Kong dollars (about 9.6545 million yuan), down 33.8% year-on-year. The recorded loss increased from 930,000 Hong Kong dollars (about 745,100 yuan) in the same period of last year to 13.38 million Hong Kong dollars (about 10,720,100 yuan). In October 2014, the company announced its financial results for the fiscal year ending in March, and its revenue recorded 68.08 million Hong Kong dollars (about 54.5457 million yuan), down 9.7% year-on-year. The loss expanded to 40.81 million Hong Kong dollars (about 32.697 million yuan). Further, in 2012, Chengbao Media lost 10.87 million Hong Kong dollars (about 8.709 million yuan) for the whole year, and in 2011, it lost 40.47 million Hong Kong dollars (about 32.4246 million yuan).

Gu Zhuoheng, Chairman of the Board of Directors of Chengbao, said that he would first inject HK$ 5 million (about RMB 4.006 million) and submit a plan, and then inject RMB 100 million every year, hoping that KPMG would apply to the court to resume the operation of Chengbao.

While Hong Kong citizens have not recovered from their consternation and regret for Cheng Bao, the Next Weekly trade union under One Media suddenly announced that Next Weekly will cut its staff by half in a short time, and then decide whether to stop publishing in mid-September.

The Hong Kong Journalists Association regrets the closure of the New Newspaper. Cen Yilan, chairman of the Association of Journalists, said that the emergence of free newspapers, the development of the Internet and smart phones have made traditional newspapers face unprecedented threats.

Huang Yu, a professor of journalism at Hong Kong Baptist University, told the interface journalist that Cheng Bao and Xin Bao are both precarious newspapers. They have no unique position in the market and cannot attract readers and advertisers. They have been in a weak state in the market competition for a long time.

Hong Kong has a population of more than 7 million, but there are more than 20 highly market-oriented local and international newspapers with fierce competition.

Huang Yu bluntly said that compared with the mainland newspaper industry, the Hong Kong newspaper industry is "particularly difficult". He said: "Newspapers in both places are undergoing transformation, but what is special in Hong Kong is the impact of free newspapers, which has prompted the decline of traditional newspapers in Hong Kong to be faster and more thorough."

Unlike the mainland market where urban newspapers are everywhere and free newspapers are half dead, free newspapers are popular in Hong Kong.

At present, there are at least four free newspapers in Chinese in Hong Kong. Metropolitan Daily, which belongs to Swedish newspaper group, was first published in Hong Kong in April 2002, and now it distributes about 400,000 copies every day. Headline Daily, which belongs to Sing Tao Group, was founded in early July 2005, and now its daily circulation reaches 850,000, the highest in Hong Kong. The other two are am730 and Qing Bao.

Free newspapers are distributed by special personnel in subway stations, shopping malls, communities and other places every morning. Compared with the traditional paid newspaper, the content of free newspaper is relaxed, with more pictures and shorter content.

In addition, the income source of free newspapers only depends on advertisements. According to a research article published by Su Keyi, a professor at the School of Journalism and Communication of the Chinese University of Hong Kong, according to the statistics of admanGo, an advertising market research company, the advertising market share of free newspapers in Hong Kong has increased from 6% to 14% in the past five years, but the advertising revenue of paid newspapers has decreased by 1% year by year.

Free newspapers continue to occupy the newspaper market in Hong Kong, and Hong Kong people care about local news in Hong Kong. Free newspapers have been able to meet the reading needs of the vast majority of people, which has caused a great impact on paid newspapers.

Cen Yilan, chairman of the Association of Journalists, said that the paid newspapers are in a new round of elimination war in the face of the decline in readers and advertisements. It is not surprising that the paper media is facing graduation, but they are not pessimistic about the prospects of the media industry.

However, some scholars believe that the influence of traditional paid newspapers is incomparable to that of free newspapers. Zhang Shaowei, a senior lecturer at the School of Communication, Hong Kong Baptist University, told the interface journalist that after 10 years of impact of free newspapers, the influence of paid newspapers in Hong Kong on society is still incomparable to that of free newspapers. "Paid newspapers have editorials and comments from a large number of influential social figures, which can have an influence in society."

Different newspapers have different status in the eyes of advertisers. "The advertisements of free newspapers are mostly supermarkets, beauty and health products, and the consumption power of consumer groups is not strong, while paid newspapers still attract large advertisements such as cars and luxury goods." Zhang Shaowei said that there has always been competition between free and paid newspapers, but there is not much overlap.

If we say that under the impact of free newspapers in the past 10 years, Hong Kong’s paid newspapers can still stand up, then the new media format brought about by the development of the Internet will make Hong Kong’s paid newspapers confused. Mobile phones and tablets have become an indispensable part of Hong Kong people’s lives. Especially after the launch of iPhone4 in 2010, Hong Kong people quickly developed the habit of surfing the Internet on mobile phones. In the process of transformation, Hong Kong media actively or passively developed various new media.

In April 2015, a survey conducted by the Public Opinion Research Program of the University of Hong Kong found that television continued to be the main news source for the public among various media, but the Internet replaced newspapers and became the second largest news source for Hong Kong people for the first time.

More and more readers are used to reading online newspapers instead of paper ones. Nowadays, most newspapers in Hong Kong have created their own new media applications. Newspapers such as Wen Wei Po, Ta Kung Pao and Commercial Daily publish complete scanned versions to official website and new media applications free of charge every day, while newspapers such as Hong Kong News and Ming Pao adopt a subscription mode.

Apple Daily, a subsidiary of One Media, is at the forefront of the reform of new media. According to the information of the Hong Kong Publishing Sales Notary, the average daily sales volume of Apple Daily dropped to 259,000 in 2011, down nearly 12% year-on-year, and even dropped to 170,000 in 2014.

In recent years, Apple Daily has been actively transforming, and its income source has begun to expand from newspapers to the Internet, vigorously promoting vivid "moving news". "Moving News" has become the main channel to attract readers, and the APP has long been ranked in the forefront of Hong Kong’s mobile phone software download list. In addition, the Facebook page of Apple Daily has a total of about 1.48 million likes, while the YouTube channel has 924,000 subscribers and has been watched 1.09 billion times. These figures are beyond the reach of the paper platform of paid newspapers.

Huang Yu said that among the major newspapers in Hong Kong, Apple Daily and other newspapers have expanded well on the online platform, and all newspapers are desperately earning click-through rates on the online platform, occupying a favorable position. "Moving News" attracts a large number of young people, and the effect is also considerable.

In addition to the transformation promoted by traditional media, some small-scale online news media have become active since 2012. Most of these news organizations were founded by former mainstream media reporters, commentators and businessmen, and most of them first operated with Facebook as the main line, which was divided into business model, social organization model and non-profit mode, and received wide attention.

Among them, some online media with clear political inclination are also sought after by Hong Kong netizens. Position News, established during a student movement in 2012, has been a media platform for some people in Hong Kong to express their opinions. According to the official website information of Position News, the platform operates on the principle of non-profit and accepts unconditional donations from the public.

Huang Wei said that since 2010, Hong Kong society has gradually become politicized from the economic society. At this time, the media with strong mobilization and persuasive communication characteristics came into being, and the society has a stronger demand for such media.

However, most new media rely on traditional news organizations as the first-hand source of online news, only adapt and comprehensively report, and rarely have their own interview teams. Zhang Shaowei pointed out that Hong Kong’s new media is only a marginal market at present, and new media organizations have their own positions, but they don’t have a lot of information sources, and it is difficult to set the agenda.

In May 2015, Hong Kong G newspaper was officially launched. In the past two months, the most articles on Facebook have been read 300,000 times. CHOW Yung, Robert, the founder, was previously engaged in a number of media. In an interview with an interface journalist, he introduced that Hong Kong G newspaper has no reporters for the time being, only 10 editors, and it is estimated that it will invest about 4 million Hong Kong dollars (about 3,204,800 yuan) a year.

In response to the question about the original intention of being a new media, CHOW Yung, Robert said that traditional newspapers can’t be a new media without traditional thinking, and new media can be a short and quick analysis. "We don’t have a reporter now, but the editor will immediately comment on the news and make efforts to interpret it."

New media needs to solve the problems of funding sources and long-term operation. In June 2015, Zeng Yucheng, the chairman of the Legislative Council, was suddenly exposed by an online new media to a recording suspected of involving racial discrimination, which caused an uproar. This online media is HKFP(Hong Kong Free Press), an English online media that has only been online for two weeks.

Tom Grundy, the founder of HKFP, told the interface journalist that the website launched fund-raising on the crowdfunding platform in early May, and the response was extremely enthusiastic. Within two days, it raised the target of 150,000 Hong Kong dollars (about 120,200 yuan), and when the fund-raising was completed, it raised 588,000 Hong Kong dollars (about 471,100 yuan) in excess.

At present, HKFP has eight journalists. Tom Grundy pointed out that crowdfunding funds are mainly used for journalists’ salaries. The original target of 150,000 Hong Kong dollars (about 120,200 yuan) is enough for HKFP to operate for two months. Every extra HK$ 50,000 (about RMB 40,100) raised can support HKFP to operate for one more month.

HKFP funds mainly come from fundraising and sponsorship. Tom Grundy said that after HKFP has been in operation for a period of time, it will open up more sources of income, such as membership payment subscription, advertising income and manuscript fee income, and will continue to raise funds through fundraising or mass fundraising.

There are many others like HKFP that expand new media business with Facebook as the main line. Huang Yu said that new media appeared in Hong Kong for five or six years, especially after the emergence of social media, the channels for citizens to obtain information and social interaction have changed greatly, so that small-scale capital-operated media operations can survive for a certain period of time.

However, the media of this kind of new media has not yet been finalized. Huang Yu said that the cost of social media is not high, so there are various ways to invest in the media now, but how long this kind of media can last remains to be seen.

"But more and more people who develop new media are beginning to rely on traditional media. Only when these people can fully engage in new media with the three weapons of product, capital and market will they move to another new stage." Huang Wei said.

Free newspapers are competing with traditional newspapers to seize the advertising market, and new media are springing up like mushrooms after rain. Under the double squeeze, the life of traditional media in Hong Kong is not easy.

Huang Yu said that the overall decline trend of paper media is the background of the transformation of the global media industry. Hong Kong’s market economy is highly developed, and the paper media will inevitably be impacted by fate. With the gradual completion of their historical mission, the mode of mass media communication will also undergo important changes.

Zhang Shaowei, on the other hand, feels that the traditional newspapers in Hong Kong have been undergoing transformation and trying to survive, but there may continue to be newspaper closures in the future.

This is probably the reality that traditional media have to face.