How might we save Taiwan's media?

Overabundance of newspapers competing in the market will force many to take serious measures to survive, writes Joe Hung

The China Post
Monday, June 30, 2008

By Joe Hung

The decision by one of Taiwan's four major newspapers to appear as a tabloid in September prompted the Government Information Office to call a meeting of press CEOs not long ago to find a way out for financially stringent media. Of course, there's no easy way out. As a matter of fact, the conference is nothing but much ado about nothing. The days of great papers are numbered.

Let's first review the development of the press in Taiwan. (Few press CEOs know exactly how Taiwan's newspapers have grown and is now seeing its decline and, probably, fall.) During the Japanese occupation of Taiwan, one newspaper was run by ethnic Chinese. The Taiwan Min Pao (People's Journal) had a couple of pages published in Chinese. Its successor, The Taiwan Shin Min Pao (New People's Journal), was ordered to publish all pages in Japanese in 1938. The paper wasn't a money-making enterprise. The Hsin Sheng Pao (New Life Journal) took over the Taiwan Nichnichi Shimpo (New Daily Journal), the one the Japanese had formed by merging all papers for lack of newsprint toward the end of the Second World War, when the island was restored to the Republic of China in 1945.

Newspapers mushroomed in Taipei in the latter half of the 1940s. None of them were lucrative -- most losing money except The New Life Journal which was owned by the Taiwan Provincial Government -- simply because there weren't many readers. Few native islanders could read Chinese-language papers. Most of them couldn't afford to buy them, for papers were very expensive to them. The situation went from bad to worse for newspapers in Taipei then. One result was a merger of three almost bankrupt newspapers. Financial exigencies forced them to put out one edition a day in the name of Lien Ho Ban or United Edition. After martial law went into force following the removal of Chiang Kai-shek's Kuomintang government from Nanjing to Taipei at the end of 1949, no applications for daily newspaper licenses were accepted, The China Post being the only exception, because it was published in English.

The publication law, on the other hand, allowed those periodicals that appeared more than twice a week to apply for daily newspaper licenses. (There in fact wasn't what is known as a ban on new newspapers; anybody could apply for a license, according to the paper-licensing system; but no license could be granted under the pretext that newsprint imports were not enough to supply the new demand. No newsprint was produced in Taiwan for decades after its retrocession and imported paper was rationed.) Runaway inflation compelled the provincial government to launch a commodity price control commission, which published Cheng Hsin Hsin Wen, a mimeographed bulletin appearing on weekdays to report price changes.

It was a really hard time for the press in the 1950s. And all struggling papers had to "welcome" aboard a competitor. The Central Daily News, a Kuomintang mouthpiece, moved to Taipei and soon became the paper with the largest circulation in Taiwan. Another Kuomintang publicity organ was The China Daily News, owned by its Taiwan provincial chapter. It had two editions, one for Taipei and the other for Tainan. The New Life Journal had an affiliate in Kaohsiung, called The Taiwan Hsin Wen Pao.

The influx of close to two million new emigrants from China after 1950 and years of Mandarin teaching resulted in a large increase in readership. The Cheng Hsin Hsin Wen turned itself into the regular paper Cheng Hsin Hsin Wen Pao, which changed its name finally to The China Times that has decided to appear in tabloid form. The Lien Ho Ban dropped the last word and called itself Lien Ho Bao or The United Daily News.

Taiwan's phenomenal economic progress, more than anything else, ushered in an era of unprecedented prosperity for newspapers that formed a government-sanctioned cartel monopolizing dissemination of information. Economic prosperity made their advertising revenue skyrocket. Time was when non-regular advertisers had to remain on a waiting list for insertion for weeks. The inception of aerial TV networks and the competition from the Broadcasting Corporation of China, all under control of the government or the Kuomintang, didn't dent the revenue of the newspapers from advertising, for the pie continued to grow rapidly.

Things began to change after President Chiang Ching-kuo lifted martial law in 1987. Anybody could obtain a license to start a newspaper. Many papers were founded. One of them was The Liberty Times, which started to outsell rivals by offering a large discount in subscription. Keen competition caused a few "old" newspapers to go under. The Independent Evening News, which published a morning edition after 1987, closed down. So did the Taiwan Daily News, which had to move from Taichung to Taipei for a short precarious survival. The electronics media were seriously affected by the proliferation of cable TV networks.

Large-circulation newspapers then faced the challenge of tabloid journalism. The Hong Kong-based Apple Daily easily ousted The Central Daily News and other government- or Kuomintang-operated papers. If the economy had continued to grow fast, every newspaper would have had no trouble. But Taiwan's long economic doldrums sharply shrunk the advertising pie, while major papers, all of them overstaffed, had to cope with an increasingly high cost of operation, the surge in newsprint prices included. To cut the cost, The English-language Taiwan News has long appeared as a tabloid.

One thing must be clearly understood. Media are subject to the Darwinian law of survival for the fittest, call it the law of the jungle, if you will. Only the fittest of newspapers can survive. Those that lose in the struggle for existence have to be washed out. No government help can save them.

The GIO must have known one biggest trouble afflicting the media in Taiwan is that there are too many of them. Take the Greater Washington area as an example. There is in effect only one newspaper, The Washington Post, in an area with a population on a par with the Greater Taipei area. The per capita income of the former is twice that of the latter, where there are four major newspapers -- The United Daily News, The Liberty Times, The Apple Daily and The China Times which will soon drop out. Simple mathematics dictates the number of papers in Taipei to decrease to two, at most.

Albert Yu, publisher of The China Times, told me 17 years ago the combined circulation of his group was one million copies and he had 6,000 employees on the payroll. He said the group had NT$10 billion in sales. At that time, The Sankei Shimbun in Tokyo, which also operates the Fuji TV network, had a daily circulation of 2.5 million and a 2,500-strong staff. I didn't dare to tell him The China Times was grossly overstaffed and he would be in trouble when Taiwan was in an economic downturn. The United Daily News, I am certain, couldn't fare any better. The Liberty Times was in the red, but its owner Lin Rong-san was more than rich to mind the loss.

But the demise of great papers was on the wall after the introduction of the Internet. The invention of the computer started the world's second industrial revolution. Everybody can use his PC to go online to get whatever news he wants free of charge anytime he so wishes. He can blog or chat with any likeminded other on social network. There is no feedback from newspapers! Why should he buy a bulky newspaper, most of whose stories are of little interest to him? Newspapers are bound to see their circulation plummet to the extent that they cannot break even. They can operate their Web sites, but not many advertisers can be attracted.

Newspapers have changed with time. The invention of the Linotype cut down the cost of printing and led to the proliferation of local papers in the United States. Then came the penny press. Remember Horace Greeley? Yellow journalism? Joseph Pulitzer? James Gordon Bennet? William Randolph Hearst? Pulitzer's Tribune had to be merged with Bennet's Herald to survive as The New York Herald-Tribune, which was finally sold to the New York Times. Where is the Hearst empire? The legendary Hearst sent a correspondent to Havana to cover the Spanish American war of 1898. When the reporter said there was no news to be covered, Hearst ordered him to stay put. "You supply the news; and I supply the war," the American paper mogul intoned. In the end, the Congress swayed by yellow journalists forced President William McKinley to declare war on Spain. The New York Times and The Washington Post are feeling the pinch. They are making adjustments to survive.

The GIO must be reminded that nothing it may try to do will help ailing newspapers in Taiwan. They may follow in the footsteps of The Apple Daily or otherwise devise their own way out of the predicament for which they have only themselves to blame.