South China Morning Post to Put Up Paywall Amid Hong Kong Slump
(Bloomberg) -- South China Morning Post is dropping its free online model after months of political unrest and the coronavirus pandemic hit advertising revenue at the Hong Kong newspaper backed by Alibaba Group Holding Ltd.
Starting next month, the financial hub’s largest English-language newspaper will ask its readers to pay for content online, limiting free articles to a few per month, Editor-in-Chief Tammy Tam said Monday on the newspaper’s website.
Hong Kong’s media industry has been reeling from the Covid-19 pandemic and months of political protests against Beijing’s tightening grip over the city. In April, with much of the city’s retail and tourism industries grinding to a halt, the South China Morning Post cut executive salaries and asked some workers to take unpaid leave.
“Comprehensive reporting is costly and the century-old advertising model is no longer enough to sustain high-quality news,” Tam said in the message Monday.
The newspaper had 50 million active users on its online platforms as of March and about 347,000 print readers as of the fourth quarter, according to its website. In January 2019, Joseph Tsai, vice chairman at tech giant Alibaba, said at a business conference that the South China Morning Post need not worry about profit and loss for five years.
The newspaper’s revenue plunged by half in the first quarter, Chief Executive Officer Gary Liu said in an interview last month. The paper began offering free news online after Alibaba agreed to buy the 117-year-old paper in 2015 from Malaysian billionaire Robert Kuok for HK$2.06 billion ($266 million).
Newspapers in Hong Kong are also having to adapt to a new national security law that democracy activists say will strengthen Beijing’s role in suppressing dissent.
Other newspapers in Hong Kong that have been struggling include Apple Daily, led by pro-democracy media mogul Jimmy Lai. Advertising income has slumped to almost nothing amid the protests and pandemic. Lai has blamed the drop partly on political pressure from Beijing on advertisers to pull out of the paper. Lai has been pleading for subscribers to sign on again after the total fell below 600,000 from about 800,000, he said in late April.
©2020 Bloomberg L.P.