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How are Chinese Media Doing?
(I talked with a friend of mine, a journalist-turned-editor at one of the major business newspapers in China, which gave me a better understanding of changes in Chinese media industry.)
China Internet Week, a magazine established in 1998 – the year when Sina and Sohu launched online portal sites, became a hot advertising platform shortly after its launch. Jiang Qiping, its founding chief editor, remembered the old good days around 1999 when advertisers, most being emerging e-commerce players, were waiting in line to throw money at them. The advertising revenue his company received in that year made a record, Jiang recalled in 2010. But now, it’s just another print magazine very small a number of readers would buy.
To my knowledge, Chinese print media have been making a majority of revenues from advertising, which isn’t so simple as ad pages in publications, but in various forms; for instance, research reports at request of brands, advertising offerings at conferences held by a magazine, etc. Media people generally refer to their major revenue source as “organizing conferences”. Advertising revenues from conferences are in forms of sponsorship slots, speaking slots, articles or ads in conference journals.
My friend confirmed it, speculating that no more than 20% of the total revenue of her company’s is from selling newspapers and affiliated publications. Of the total publication sales, most are through post office subscriptions and very few are sold at newsstands. Very few magazines can profit by selling issues alone.
As print media saw the declining in old forms of advertising, they came up with creative, if not dirty, ways in doing marketing for advertisers; which, as my friend put it, is kind of robbing businesses of public relations companies. That includes having journalists or editors writing favorable reports for customers. It isn’t that it never happened before, but that some journalists have been doing that dirty business in the underground market. But for journalists and editors like my friend , it’s a torture to write that kind of stuff.
They want to join in the new media, who have been grabbing their ad revenues and gaining readership. Online news portals were the first new media that are still making a living through online advertising to this day. CPM-based display ads on articles or video pages, however, isn’t that profitable compared with other internet businesses.
Parent companies of most news portals, Tencent, Sohu and Netease, have been making a majority of income from online gaming and other consumer-facing paid services. In its best days, Sina, one of the few with online news as its main business, made a big chunk of revenues from paid mobile services. At the same time, small news portals. who have no rich parents, have been generating revenues from both CPM-based online ads and advertising offerings created by print media.
The new generation of online media, tech-centric blogs set up by non-media people, emerged in the past years. More recently, professionals from print media joined in. They carry limited ads and have to be backed by investments.
They become famous with niche groups, the masses, however, are users owned by the parent companies of those old news portals, say, Tencent’s QQ users, Sina’s Weibo users. Those platforms are even more attractive, in terms of influence and salary, to professionals from traditional media world.
Also, the old portals are not reluctant to change. Sohu and Netease are fighting hard on mobile news apps. Tencent’s QQ.com set up a platform for famous writers to self-publish digital works, long or short, in this format or another. Sohu plans to build a B2C news service to help print media or other providers to sell digital content. All the endeavors are not expected to necessarily be revenue generators, but backed by their rich parent companies.
The newspaper my friend is working for also sells content to major news portals, for a limited fee that cannot help them survive the new media impact. Her bosses calls for a move of imitating the blogs set by former print media people. But my friend doesn’t think that would change anything so long as her bosses think they are doing OK with existing ad revenues and means to attract advertisers.
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