Perhaps Jeff Bezos started a trend two years ago when the Amazon founder acquired the Washington Post.
Chinese e-commerce giant Alibaba announced today that it has acquired the South China Morning Post and other assets of SCMP Group Limited.
“The South China Morning Post is unique because it focuses on coverage of China in the English language,” Alibaba Executive Chairman Joe Tsai said in a statement. “This is a proposition that is in high demand by readers around the world who care to understand the world’s second largest economy. Our vision is to expand the SCMP’s readership globally through digital distribution and easier access to content.”
The New York Times reported that Alibaba’s acquisition of SCMP is about “an ambitious play to reshape media coverage of its home country” and a deal that lets Alibaba “offer an alternative to the biased lens of Western news media outlets.”
The SCMP, an award-winning English language newspaper based in Hong Kong, is known for its coverage of topics like political scandals in China that the country’s state-run media cannot write about. The company is not subject to China’s news media censorship rules.
The Times noted that some critics have wondered whether Alibaba’s acquisition is a move to “tame the paper’s coverage in order to curry favor with the Chinese leadership.”
“In reporting the news, the SCMP will be objective, accurate and fair,” Tsai wrote in a letter to readers. “This means having the courage to go against conventional wisdom, and taking care to verify stories, check sources and seek all viewpoints. These day-to-day editorial decisions will be driven by editors in the newsroom, not in the corporate boardroom.”
In the letter, Tsai noted that like any news media company, the SCMP faces business challenges with the way news is reported and distributed today.
“But these changes play to Alibaba’s strengths, which is why we believe the two companies complement each other well,” Tsai wrote, adding that “Alibaba is in an excellent position to leverage technology to create content more efficiently and expand distribution without borders.”
The Times reported that Alibaba, whose headquarters GeekWire visited last month, paid $100 million to acquire SCMP.
The e-commerce-giant-buying-a-newspaper deal is reminiscent of Bezos’ $250 million purchase of The Washington Post in October 2013. That was a bit different, however, since Bezos did the deal on his own, versus through Amazon.
But even though Bezos made the acquisition separately from Amazon, he put himself in a position to bring his expertise in online publishing and media to bear on his new investment.
Since he bought the Washington Post, we’ve seen a handful of Amazon-related partnerships with newspaper, like trial subscriptions to the Washington Post’s Kindle app or subscription discounts for Amazon Prime members.
Here’s the full letter from Alibaba VP Joe Tsai to readers:
Marrying Heritage and New Technology: a Vision for the Digital Age
By the time you read this, you will have heard the news that Alibaba Group is acquiring the South China Morning Post.
With an age difference between the two companies of nearly one hundred years, this is truly a mix of the old and the new. The SCMP is resonant with the history, heritage and culture of the region, just as Alibaba has its place in the new age of digital technology.
We at Alibaba are both humbled and excited to be the new owner.
Our Business Case
So, you’re probably wondering why. Why is Alibaba buying into traditional media, considered by some a sunset industry? The simple answer is that we don’t see it that way.
The SCMP has iconic status in the region, with a strong reputation internationally for the quality and credibility of its journalism over the years, thanks to its reporters and editors who have worked hard to build this heritage. Like many print media, however, the SCMP faces challenges amid the dramatic changes in the way news is reported and distributed. But these changes play to Alibaba’s strengths, which is why we believe the two companies complement each other well.
We see a compelling business case for the acquisition because we believe that Alibaba is best positioned to take the SCMP to the next level. The foundation for this work must be the quality of the content. And what underpins this will be editorial excellence: a clear pre-requisite to maintaining readers’ trust and, ultimately, achieving commercial success. Be assured, we get that.
Yet, the news business is in a state of flux. It has already gone digital and is now moving from online destination to other forms of distribution, in particular social media and mobile. Media now has a global audience and the challenge is to reach it in the most efficient and reader-friendly way. With proven expertise in digital distribution, especially on mobile devices, Alibaba is in an excellent position to leverage technology to create content more efficiently and expand distribution without borders.
In other words, we see the perfect opportunity to marry our technology with the deep heritage of the SCMP to create a vision of news for the digital age.
Our vision is to grow the readership globally. We believe we can do this because the SCMP, from its base in Hong Kong, is uniquely positioned to report on China with objectivity, depth and insight, a proposition that is in high demand by readers around the English-speaking world – from New York to London to its home in Hong Kong – who care to better understand the world’s second largest economy.
To help achieve our vision, we plan to make the SCMP more readily available. In this spirit, with enough preparation time after we take over operations, the pay wall on SCMP.com will come down, and you will be able to access its content for free on the Internet and on your mobile device.
We will also invest to strengthen the foundation of editorial excellence. Only through additional resources will the SCMP be able to stay true to its core values of quality, integrity and trust. Further, the SCMP will stay close to its roots, with a strong China focus offering distinctive and informed analysis on trade, business, economy and society while maintaining its status as the paper of record for Hong
Some have suggested that ownership by Alibaba will compromise the SCMP’s editorial independence. This criticism reflects a bias of its own, as if to say newspaper owners must espouse certain views, while those that hold opposing views are “unfit.”
In fact, that is exactly why we think the world needs a plurality of views when it comes to China coverage. China’s rise as an economic power and its importance to world stability is too important for there to be a singular thesis.
In reporting the news, the SCMP will be objective, accurate and fair. This means having the courage to go against conventional wisdom, and taking care to verify stories, check sources and seek all viewpoints. These day-to-day editorial decisions will be driven by editors in the newsroom, not in the corporate boardroom.
It’s humbling to assume the responsibility of ownership of such a storied newspaper. We thank the Kuok family who have been tremendous stewards of your trust; we hope Alibaba will have an opportunity to earn your trust.
Executive Vice Chairman
Alibaba Group Holding Limited