Hong Kong Tycoon's Media Venture in Trouble
|Our Correspondent||Dec 11, 2010|
Cai Business Indepth, an ambitious Bloomberg-style business reporting operation on China that was launched in 2007 by Richard Li, the chief of Hong Kong's PCCW telecommunications empire, appears to be on its last legs, according to industry insiders.
"Things have been deteriorating for a long time," said one of the 20-odd journalists hired by Cai Business Indepth, also known as CBID, in a telephone interview. Although widespread rumors in Hong Kong had the operation completely closed down, the journalist said he didn't know if it was closing.
At a time when the news business across the planet faced considerable challenges, because of the billionaire Li's deep pockets, it was felt by media watchers that CBID had a better chance of succeeding than most. But although CBID launched its first product in July to seek to deliver China-focused business news via its own terminals, it was never really able to get off the ground, the insiders say.
The service, beamed specifically at financial institutions, was to be delivered both across the internet and through proprietary terminals, much as Bloomberg's service is, as well as to handheld devices like the ubiquitous Blackberry. It was designed as an English-language only service based on a subscription model.
In September of 2009, officials said the launch was just a month away. After two years of preparation and delays, however, it became clear that the operation was in trouble. In August 2010, two weeks after the soft launch finally got off the ground, Stuart Jackson, hired at the start as the chief editor, stepped aside abruptly along with several staff members to "seek other business opportunities in Hong Kong," the euphemism employed to describe his departure.
The organization's first plan was to build its coverage around Caijing, then China's most-respected independent magazine. But in November of 2009, Hu Shuli, one of China's most outspoken and influential journalists, quit as Caijing's editor, reportedly after a long series of confrontations with the magazine's owners over financing and censorship. Most of the magazine's editors quit with her. Shuli launched Caixin Media in December 2009 and started to publish two magazines and run one website from January. (www.caing.com and in English english.caing.com )
In July, CBID finally announced that it had signed Caijing as its exclusive news contributor in China. But though Caijing continues to publish strong reporting, it no longer has the respectability that it had under Hu.
Although the news team assembled by Smith and Jackson continued to generate quality content, the industry insiders say, customers reportedly have been hard to find. Reporters have continued to drift away from the venture although plenty remain.
Besides Li's deep pockets, the news reporting service was backed by a strategic alliance with the Hong Kong Economic Journal. But even though Li's coverage was centered on China, he was betting into the strong hand of Bloomberg, which has been phenomenally successful in delivering not only news but also a huge stream of data to other news organizations and companies at a time when the news business itself is in trouble. Bloomberg's operation has continued to broaden away from pure financial news to politics, sports and culture, becoming in the process a general interest wire service.
Despite a rumor that surfaced in Hong Kong earlier this year that Rupert Murdoch, the owner of Dow Jones, which publishes the Wall Street Journal, was working on a tie-up with Li's operation, it never happened. Murdoch instead has been busily rebuilding the Wall Street Journal's business reporting operations. In addition, CBID faced competition from a China-based operation, Capital Vue, which was offering the same kinds of information.
Richard Li has been seeking to expand his media empire from the time when, using money he borrowed from his father, he bought into a local satellite television firm, Star TV, taking it regional and then selling it to Rupert Murdoch in the mid-90s for US$950 million — one of the biggest ever media deals at the time.
Li then took an obscure telecoms company, Tricom International, and turned it into his Pacific Century Cyber Works, or PCCW. From that point forward, he has sometimes faced difficulty, particularly in his attempts to do something about the one-time Hong Kong Telecom franchise he bought from Cable & Wireless just in time to run into the buzz saw of deregulation. In 2003 PCCW turned its fortunes around somewhat by establishing Now TV, a broadband television network, that has since become one of the world's largest such operations. PCCW's Internet operations have also been successful.
In June, Jeremy Goldkorn, writing on the Chinese media and advertising website Danwei, wrote in a short analysis of DBID's operations that "It will be interesting to see if this company goes anywhere, or if it becomes just another case of a rich man throwing money down the drain because he wants to be a media mogul."
Obviously, Goldkorn's question hasn't been answered quite yet.'