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James Borton eyes the media

This is the first installment of a media column by author and journalist James Borton, providing timely insights into Asian media affairs; he shines the spotlight on media trends.

Media tycoon an anti-Beijing typhoon

Jimmy Lai, 55-year-old entrepreneur and brazen media tycoon, shows no signs of mellowing. He still brandishes the same trademark paparazzi publishing style: investigative political and propagandistic reporting, sensationalism mixed with the requisite photos of naked women. But like a fast-moving typhoon slashing across the South China Sea, Lai's approach to news has almost guaranteed that he is no friend of mainland China.

It has been three years since Jimmy Lai took his Hong Kong-based media road show to Taiwan and started Taiwan Next weekly magazine - No 1 in terms of readership - and Apple Daily Taiwan; he also publishes a Hong Kong edition of Apple Daily.

Some observers insist his relocation to Taiwan was designed to be a launching pad for a tougher media attack on China, and others suggest his Taiwan move was solely motivated by Taiwan's freer and more lucrative media market. After all, Taiwan has nearly 22 million readers, compared with Hong Kong's 7 million.

Lai Chi-ying, or Jimmy Lai, packed his bags and his family in Hong Kong, leaving on his corporate yacht (aptly named Free China) in the wake of dashed - but only for a while - dreams, lawsuits and enemies, but he took to Taiwan a resolute belief that Taipei offers more personal and press freedom.

As the editor-in-chief of Next Media, the self-educated refugee from Guangdong province wrote many vitriolic editorials railing against China's stranglehold on personal liberties.

His publications are banned on the mainland but they are published in Hong Kong, where Beijing is somewhat more sensitive to the sensibilities of Hong Kong residents.

While in Hong Kong, Lai even took to the streets in Victoria Park in December 2002, along with tens of thousands of other protesters rallying against the government's proposed anti-subversion law. He said the law was "like an invisible, tightening collar".

Lai editorialized for bold action in Hong Kong
An editorial in his Hong Kong mass-circulation Apple Daily was a clarion call for decisive democratic action: "In order to avoid our children having to grow up in a place without freedom of thought and freedom of information, in order to prevent Hong Kong from becoming a silent, 'dead city', there is no more room for silence. We hope citizens can, as soon as possible, explicitly express their concerns and fears of Article 23 of the Basic Law with various means."

That provision of (anti-sedition) Article 23 of the Basic Law, against which Lai and his Apple Daily galvanized mass protest, spells out that "The Hong Kong Special Administrative Region shall enact laws on its own to prohibit any act of treason, secession, sedition, subversion against the Central People's Government." Vague and all-encompassing, to say the least,

Upon his arrival in, Lai reaffirmed with his relocation and media investment that the small island of Taiwan is the first and the only democracy in China.

Taipei's newsstands are running out of space for its 6,000 magazines vying for new readership, but Jimmy Lai's Apple Daily and Taiwan Next, a popular tabloid newsmagazine, stand out.

The expansion of Taiwan's media has led to desperate commercial competition and no-holds-barred aggressiveness among the island's viable media. Some 80 radio stations, 140 cable-television operators with 70 channels, 360 newspapers, and 235 domestic news agencies engage in ferocious daily competition for the attention of the public and advertisers.

"Looking ahead, we shall continue to uphold our dedication to cost control in both Hong Kong and Taiwan. However, we shall not in any way sacrifice our content for the sake of cost-cutting. A rich content is our trademark and a competitive edge," claims Jimmy Lai in the 2003-04 annual report of parent company Next Media. To be sure, investors in Next Media are concerned about the enormous expenses incurred by the Taiwan expansion.

Jimmy Lai declined repeated e-mail requests from this writer for an interview; Asia Times Online, however, was able to secure e-mail responses from senior members of his Hong Kong operation.

The formula: Politics, business, lifestyle, sex
Analysts have said that Next Media Ltd invested more than US$15 million in Next magazine's Taiwan edition, with the same focus on politics, economy, entertainment and lifestyles as its Hong Kong edition.

Next Media's latest consolidated profit-and-loss account, filed in March, reports only a modest loss post-taxes of US$11,528. While shareholders may not fully understand the expenses involved in the launch of Lai's Taiwan Apple Daily in April 2003, the newspaper achieved an average daily circulation of about 406,000. This is a remarkable feat in an oversaturated media market. And Taiwan Next magazine, established in 2001, sustained its top ranking as the most widely read weekly magazine, according to the ratings service Nielsen Media Research (Taiwan).

Next Media Company Ltd, the parent company, was first established in Hong Kong in 1989, with the debut of Next magazine, a Chinese-language weekly general-interest magazine with the motto: "Don't Put on Airs: Just Seek the Truth." It was only a matter of weeks after the launch that the slick four-color magazine lambasted Beijing with its strident editorials. Lai personally branded Li Peng, China's former premier, widely recognized as the key party official who ordered the Tiananmen massacre in June 1989, as "the son of a turtle egg with a zero IQ". References to turtles and their eggs are considered extremely offensive in China.

Hong Kong Apple Daily has relentlessly attacked China for years, often in front-page articles calling Jiang Zemin, former Chinese president and until recently the nation's commander-in-chief, as "one of the top enemies of the press".

Last year in Hong Kong on the eve of the July 1 pro-democracy protest, Lai's Next magazine served up the ultimate in-your-face journalism by placing on the cover a mock-up photo of Hong Kong Chief Executive Tung Chee-hwa taking a pie straight into his face. The caption encouraged all readers to "take to the streets". Jimmy Lai the media personality also walked the walk to extol freedom in Hong Kong during that freedom march, mixing it up with nearly a half-million protesters.

Lai's language, his verbal attacks against the government, and the macho gestures are reminiscent of a Chinese version of Norman Mailer, who in the turbulent 1960s placed himself front and center in his own media carnival and published work, The Armies of the Night.

Wrath of chief executive cost millions
As a result of Lai's virulent anti-China rhetoric, all of his publications are banned in the People's Republic of China, though not in Hong Kong. He also incurred the wrath of Kong Kong's pro-Beijing Chief Executive Tung Chee-hwa, resulting in a loss of millions of dollars of advertising from property developers last spring.

"Even today, we are still banned as reporters from entering China to cover any story," Liu Kin-ming, managing editor of the Hong Kong Apple Daily opinion page, said in a recent Asia Times Online e-mail interview.

Jimmy Lai ardently subscribes to the belief that Taiwan has a historic opportunity and mission. In an editorial in his weekly Taiwan Next magazine, he states that "economic integration also means you're playing a greater influence on China, an influence that will urge it toward democracy". Democracy in Taiwan, he argues, will protect the island from losing its political independence; when push comes to shove, the Taiwan people simply won't vote for reunification, claims the flamboyant editor.

Controversy followed Lai in Taipei, where he quickly earned the enmity of President Chen Shui-bian. Taiwan Next magazine published a 14-page report detailing how former president Lee Teng-hui supposedly authorized the National Security Bureau to set up two secret funds to finance diplomatic overtures to other countries to win their support, sometimes involving direct cash payments to their governments.

This Asian media drama unfolded in a calculated manner when Lai published allegedly secret documents taken from the Taiwanese government's National Security Office. The informant, Colonel Liu Kuan-chun, a former chief cashier at Taiwan's National Security Bureau, reportedly passed some of these sensitive papers to Taiwan Next magazine before fleeing to Canada under protection of the US Central Intelligence Agency.

Lai's glossy publication splashed headlines about this alleged secret US$100 million slush fund created by former president Lee, allegedly used for wide-ranging diplomacy-building programs to establish Taiwan as a special de facto sovereign state. Virtually the entire world, however, recognizes the People's Republic of China diplomatically, while doing business with Taiwan. Government officials raided Taiwan Next magazine offices, threatening to shut down the publication and seizing copies of that issue at his printer's plant. The net result was regional and international publicity for the publication.

For Lai, it was another bold step enshrining his public image as a media rainmaker or for some, a petulant publisher, for taking on all government agencies.

A bloody two years of lawsuits, red ink
The past two few years have proved bloody for the pugilistic middleweight publisher in Taiwan, whose stock, which includes shares of the media corporation that publishes Apple Daily in Hong Kong, now runs in the red.

Although Jimmy Lai declined to forecast or discuss the group's full-year loss figures, a staff assistant directed this reporter to the annual report. Asia Times Online also learned that the payroll for the Hong Kong Apple Daily newspaper exceeds 500 employees.

"Apple Daily in Taiwan is up to almost a 20% market share with circulation gains fairly strong over the past six months and with a daily circulation approaching almost 500,000 copies. His operation lost almost US$70 million in fiscal 2004, year ending in March, losses will reduce over the next three years, but we still can't see a break even clearly until 2008/2009," media analyst Vivek Couto with Media Partners Asia in Hong Kong said in a recent e-mail interview with Asia Times Online.

Lai seems undeterred in bringing freedom to the Chinese people through his media enterprise. Some analysts say that ever since the Hong Kong media mogul entered the fray in Taiwan in 2001 and launched Taiwan Next weekly magazine and Apple Daily, tabloid-style journalism has been on the rise.

Taiwan Next magazine was launched with an expensive US$3.6 million advertising campaign touting a circulation of 250,000, making it overnight one of the country's best-selling weekly magazines.

Lai's bravado and capital has edged out all competitors.

This includes the entrenched and reputable China Times Weekly. But few can dispute that Jimmy Lai's media gamble on Taiwan is based on a single premise: that the country's raucous and free-wheeling democracy would embrace his controversial journalism.

Lai: Media the people's servant
"It's very exciting to live in a democracy. It's too tempting," Lai said when asked by members of Taiwan media in late May 2001 why he officially changed his residence to Taiwan. Lai offers a revealing statement on the role of the media buried in Next Media's annual report: "The media are not the tools of the ruling powers but are the people's servant." And that includes the occasional brothel review.

Before Lai's relocation to Taiwan, Hong Kong's Apple Daily was on a new journalism trajectory that might give that titan of tabloids, Rupert Murdoch, pause. In efforts to boost readership, the newspaper published daily sexually explicit images and even casual reviews of recommended brothels in the "City of Lights".

Apple Daily still remains one of Hong Kong's highest-circulation daily newspapers, approaching nearly 500,000 copies, but Lai's boldness and popularity has carried a price: a plethora of lawsuits and high fines.

According to the popular Chinese website, since the enactment in 1994 of the Obscene and Indecent Articles Ordinance in Hong Kong, Next magazine has violated the law many times and has paid fines ranging from US$5,000-$14,000.

Even Taiwan Next magazine has also violated the island's law against obscenity. Last year, a formal complaint was registered against the magazine after the editor published a photo of a nude schoolgirl.

No one denies that an independent and lively press is the foundation of Taiwan's democratic society, though debates continue among academics and journalists over the true limits of free expression. Taiwan's media penchant for covering scandals was checked by this spring's high-profile lawsuit filed by the daughter of presidential candidate Lien Chan suing Taiwan Next magazine, alleging that it falsely reported that she wrote a series of letters to a friend about her father beating her mother.

"Jimmy Lai is merely reinforcing the existing trends of [Taiwan's] print media to become even more sensational and privacy-intruding," Professor Chien-san Feng of the department of journalism at Taipei's Cheng Chi University said in an online interview with Asia Times Online.

There are few examples of downmarket tabloids ever rising to the top, and some analysts are still undecided whether media competition generates innovation and creative commerce. But one thing is certain: Asia media observers are all asking what's next for Jimmy Lai.

James Borton is an author ( Venture Japan, a pioneering book on capital markets), freelance journalist and director of Asia-Pacific projects for Foreign Affairs journal, published by the Council on Foreign Relations in New York. He welcomes media news releases, story ideas, tips on trends and comments. He can be reached at

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