The
inclusion of China in the globalization movement and the
gradual capitalistic trajectory of the Communist Party's
sclerotic communication system is most evident through
television broadcasting and the spectacular rise of the
Hong Kong-based Phoenix TV Channel, headed by a
well-connected former Chinese colonel. Its appealing and
innovative InfoNews 24-hour news channel is a stellar
example of how the Chinese Communist Party (CCP)
undertakes a delicate balancing act between market
forces and control of the media.
Phoenix TV, led
by former People's Liberation Army colonel Liu Changle,
who once served as a military-affairs correspondent for
China National Radio, understands all too well how
broadcasting contributes directly to China's economic
and social development. After all, television is the
most popular source for news and with almost a billion
TV viewers in Greater China (the mainland, Hong Kong,
Macau and Taiwan), according to Nielsen Media Research -
and the magnitude of the revenues is staggering. For
Phoenix, with more than HK$1 billion (US$128.7 million)
in advertising revenue a year, the satellite television
operator has gained recognition as a transnational media
corporation with global distribution, and it is viewed
by overseas Chinese in the United States.
In
China there's a popular expression, Feng wei bai niao
zhi wang, meaning "The phoenix is king among the
birds." Founder and chief executive officer Liu Changle,
in an interview with authors Fiona Gilmore and Serge
Dumont of Brand Warriors of China: Creating
Sustainable Brand Capital (Profile Books), said:
"All employees have analyzed the internal meaning of
this ancient Chinese symbol so thoroughly that each
member of the staff works with the characteristics of
the phoenix in mind. One of these characteristics
translates for employees as the ambition to make the
program the best it can be."
Even before China's
entry into the World Trade Organization (WTO), which
requires opening up to foreign competition, the Chinese
media industry needed a jolt of competition to meet the
needs of millions of coastal middle-class urban Chinese
starved for global, independent news sources and
information. Phoenix TV responded to the market with two
main channels - Chinese Channel and InfoNews.
The TV operator's keen understanding of what
Beijing will allow in media coverage has enabled it to
rise like the phoenix from the ashes of official central
government broadcasts to become one of the largest
broadcasters on the mainland. This means CEO Liu and his
team heed the regulations that do not permit any
references to the 1989 Tiananmen Square massacre, the
Falungong spiritual movement, abortion as a
family-planning measure, and other human-rights and some
political issues.
In stark contrast to
state-controlled China Central Television (CCTV), the
national television network of the People's Republic of
China with 13 channels, Phoenix's three-year-old
InfoNews Channel offers new ways to report the news,
familiar in the West but new in China. Professionally
trained star news reporters serve as anchors. Phoenix's
telegenic female journalists and male news readers are
often engaged in all aspects of production. Viewers find
innovative news shows modeled after Western media such
as CNN. The channel also provides live, exclusive (for
China) reporting on Taiwan - a first since the
government banned virtually all news from the island
that it considers a renegade province. Phoenix InfoNews
also provided in-depth reporting on the mining disaster
in which 166 miners died after a coal-mine explosion in
western China's Shaanxi province.
"Phoenix is
innovative, but they also know where the boundaries
are," Professor Hao Xiaoming, an expert on Chinese media
who is on sabbatical at the University of Wisconsin at
Madison Journalism School, said in an Asia Times Online
interview. "They knew that they had to be different from
CCTV, and their news department even covered SARS
[severe acute respiratory syndrome] at a time when the
government was curbing embarrassing coverage. And their
reporting was done in a very humane manner."
Few
can deny that the Middle Kingdom's market-oriented
reforms, in full swing since 2001, have paved the way
for more multinational media giants to enter
well-publicized joint ventures with Chinese media
despite embedded local protectionism and policy
restrictions. However, some academics and journalists
still question whether the so-called reforms in China's
media are weakening the iron grip that the state
maintains over the distribution of information through
traditional media, print, broadcast and the Internet.
Liu Jianming, a Tsinghua University journalism
professor in Beijing, said in an official Xinhua Online
news release that far too many news reports have
exaggerated the promising future of China's media, and
the degree to which the country will open its media.
Meanwhile, to counter Western media criticism,
China's State Administration of Radio, Film and
Television (SARFT) recently issued a decree deepening
reforms of the news, publishing, radio, film and
television sectors. Effective November 28, foreign
companies have been permitted to own as much as 49% of
joint media ventures in China, though foreign investment
in news and current affairs remains banned.
Additionally, investors must feature Chinese themes in
two-thirds of their programs.
For starters, the
Chinese government wants to take a short march to
introduce digital television for cable subscribers, who
currently receive mostly analogue programs. Beijing has
set an ambitious target of 100 million urban digital-TV
subscribers by 2008, but clearly recognizes that it
needs the cooperation of foreign investors to make this
a reality.
Even Rupert Murdoch's News Corp
invested in Phoenix TV to expand his global media reach
into China, and he now owns 37.6% of Phoenix Satellite
Television Holdings Ltd.
SARFT also granted
InfoNews Chinese landing rights, as it were, as recently
as January 2003, making Phoenix InfoNews the first
foreign Mandarin-language news channel to receive such
permission.
Liu Changle cannot deny that
guanxi - personal, political connections - plays
a role in Phoenix Satellite's success; surrounding
himself with key well-connected senior management like
Wu Xiaoyang, director of business development and the
son of former Chinese foreign minister and vice premier
Wu Xueqian, does not impede business. This comes at a
time when foreign-owned media corporations still face
some barriers to break into China's heavily regulated
media industry.
"Regarding the intimate
connection of media outlets with the party, this is
undeniably true and takes place in various forms:
through direct control or through the relatives of
officials. If one looks at the Communist Party closely,
it has three major ministries related to television: the
ministries of Propaganda, Organization, and United
Fronts," Erping Zhang, a research fellow at the John F
Kennedy School of Government at Harvard University, said
in an Asia Times Online interview.
This exalted
position as the first foreign TV operator with legal
broadcasting rights catapulted the station into a
profitable enterprise, and its satellite operation now
reaches more than 50 million relatively affluent Chinese
in the nation of 1.3 billion. Since China's advertising
market is potentially huge but highly fragmented, most
analysts still regard access to state TV as key to
cracking the problem of access to national coverage.
With reported revenue for nine months
(January-September 2004) equivalent to US$107.56
million, earnings have jumped nearly 63.5% over the same
nine-month period last year. It seems that Phoenix's
management has found the right formula for targeting the
educated Chinese professional.
Phoenix's
chairman and CEO, 52-year-old Liu, is gratified with his
media company's impressive commercial results,
especially the turn-around in performance for InfoNews,
which increased its revenue eight times a year ago to
top $16.8 million. "This proves that the Chinese
audience has an appetite for news, and that news
programming can make commercial sense in the Chinese
market," said Liu in a recent press release.
After eight years in operation, Liu's general
Chinese channel (distinct from three-year-old InfoNews,
with almost two years in China) continues to offer
diverse content to global Chinese communities. Overall,
the fare runs the gamut from mindless programs such as
the Miss Chinese Cosmos contest to InfoNews with its
balanced coverage of international news, including this
year's Taiwan presidential election held in March.
InfoNews also is seen in Taiwan.
Phoenix
InfoNews' prominence was underscored when it was the
only television channel with a major mainland audience
to broadcast live in May the inaugural address of
Taiwan's elected and often controversial President Chen
Shui-bian, who called ambiguously for bridges to the
mainland. Mainland China, however, has remained
belligerent toward Chen because of his refusal to accept
the "one-China principle", under which Beijing relegates
Taiwan to provincial status.
"Liu Changle
himself was a news reporter at China National Radio, and
I think the most important reason that he succeeds with
Phoenix TV is because he is very familiar with the
Chinese audience and the market," Yan Li, a former
editor for Phoenix TV in Beijing in 2001, and now an
editor in Washington, DC, for the Washington Observer
Weekly, told Asia Times Online.
While there are
many reasons to remain optimistic about media-market
openings, China still attempts to restrict access to
foreign news providers by blocking access to Google's
news website or jamming Radio Free Asia broadcasts.
Beijing maintains its ideological posture that only
permits relays of foreign broadcasts that never threaten
"national security" or "political stability". This
draconian law applies uniformly to its own domestic news
gatekeepers.
"China's market reforms have forced
Chinese media providers to consider economics and
income, and the bureaucratic nature of the Chinese media
has thrown up obstacles in the road to marketization,"
claimed He Qinglian, a traveling economist and author of
a report, "Media Control in China", published in English
and Chinese by Human Rights in China in 2004.
This year, Phoenix was rated as one of China's
500 most valuable brands, according to the World Brand
Laboratory, one of the leading brand-evaluation
organizations. Phoenix TV was valued at $22 billion and
ranked 23rd on the list, and it was only one of two
media corporations placed in the top 50, running second
only to CCTV. It appears that Colonel Liu and InfoNews
have learned the necessary rules for media survival -
simultaneously serve the party and the marketplace.
James Borton is an author and
freelance writer currently at work on a book on China's
media. He welcomes media news releases, tips about
trends, story ideas and comments. He can be reached at
asiareview@yahoo.com.
(Copyright 2004 Asia Times Online Ltd. All
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James Borton eyes the
media 
