Chinese Bid For Newsweek Magazine Unsuccessful

China Daily reports that an investor group led by China’s Southern Daily Group (????????) failed in its recent attempt to buy Newsweek magazine, but “the bidder is expecting to make other similar purchases.” The article does not provide details on the amount of the bid. According to the China Daily report:

“The offer to Newsweek is a volunteer action of Chinese media professionals and investors,” said Xiang Xi (??), managing editor of Southern Weekly, a weekly owned by the Group, who was granted an exclusive interview with President Obama during his visit to Beijing last November.

“With nine-language versions, Newsweek’s platform with global communication resources and influence is in line with our pursuits.”

The head of China’s most influential weekly denied any government involvement in the investments behind the bid for the Washington Post-owned news weekly. [Read Richard Mcgregor’s The Party: The Secret World of China’s Communist Rulers for a different view of what might define “involvement”.]

Xiang said the Group partnered B-raymedia, a Shanghai-listed company based in Chengdu of Southwest China’s Sichuan province that owns several metropolis papers, and two other investment funds in the purchase attempt…

Xiang said the money is not what is keeping the Chinese bidder outside of the door.

“They don’t really understand Chinese media people,” he said. “They are not sure of why we are bidding. But I understand it is easier for a US media to take over the operation.”

The tagline of Southern Weekly – described by the New York Times as “China’s most influential liberal newspaper” – is “to understand China”.

Xiang said the move is for the world to have a better understanding of China, and for China to know more of the world.

The attempt to buy Newsweek is a beginning, said the 38-year-old, adding that they are “seeking to round up investors to bid on other media abroad.”

Moves like this are to be expected. China has an aggressive policy to expand its global soft power, Chinese firms, even print media ones, tend to be cash-rich, and US traditional media firms are increasingly desperate, as Newsweek’s dire finances (and the New York Times’, Forbes’ and BusinessWeek’s) demonstrate.

This failed bid raises at least two obvious questions. First, would the US government even allow a purchase of influential US media assets, dying or not, by Chinese firms? Second, is China wasting time and money trying to expand its soft power through dying media properties?

[UPDATE: Sohu.com has a longer interview in Chinese with Xiang Xi on the bid and the possible reasons it did not past the first round. Price does not seem to be the issue. Global Voices has a translation of most of that interview with Xiang Xi, as well as other comments and thoughts on the issue from the Chinese Internet.]

Please tell me what you think in the comments.

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  • Adam Minter

    My first thought is: sell it to them, and throw in Life and the Saturday Morning Post with it. You’ve clearly got a desperate buyer – in this case, a Chinese media property so desperate to purchase credibility that it’s willing to buy a property (a news weekly, for chrissakes) that has no market or future left in its home market. I’d think the Post would be able to run up the price.

    My overall sense is that some of the folks involved in the ‘old media’ side of China’s soft-power initiative really believe that they can take short-cuts to media credibility in the West. That, and the powers that be take a look at the healthy balance sheets at Chinese media companies, fail to take into account why those balance sheets are healthy, and decide – blindly – that the ‘China model’ should work at a failing Washington Post property.

  • ryan

    A1) I dont know, I’m not the U.S. govt. However with u.s. politicians , anything is possible.
    A2) The Chinese have a saying…”cross the river by feeling out the stones with our feet” . I guess thats what they ‘ re doing.

  • Adam Minter

    My first thought is: sell it to them, and throw in Life and the Saturday Morning Post with it. You've clearly got a desperate buyer – in this case, a Chinese media property so desperate to purchase credibility that it's willing to buy a property (a news weekly, for chrissakes) that has no market or future left in its home market. I'd think the Post would be able to run up the price.

    My overall sense is that some of the folks involved in the 'old media' side of China's soft-power initiative really believe that they can take short-cuts to media credibility in the West. That, and the powers that be take a look at the healthy balance sheets at Chinese media companies, fail to take into account why those balance sheets are healthy, and decide – blindly – that the 'China model' should work at a failing Washington Post property.

  • ryan

    A1) I dont know, I'm not the U.S. govt. However with u.s. politicians , anything is possible.
    A2) The Chinese have a saying…”cross the river by feeling out the stones with our feet” . I guess thats what they ' re doing.

  • Miainchina

    “fail to take into account why those balance sheets are healthy…”

    If you are talking about any other media group in China, you are probably right. The media market in China is not a free one at all. However, I do have faith in Southern Daily Group on a free market outside China.

    When it comes to media credibility, the group’s Southern Weekly is doing a superb job. I have way more respect for the contributors of Southern Weekly than anyone I have read in Newsweek, since the former did so in an extremely hostile environment. As a Chinese journalist myself, I am amazed at the good work the weekly pulls off week after week.

    Business-wise, it’s not a good idea for anyone to buy US print media at this point, but Southern Daily Group could have been a soft power to go AGAINST the Chinese government’s propaganda.

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  • Miainchina

    “fail to take into account why those balance sheets are healthy…”

    If you are talking about any other media group in China, you are probably right. The media market in China is not a free one at all. However, I do have faith in Southern Daily Group on a free market outside China.

    When it comes to media credibility, the group's Southern Weekly is doing a superb job. I have way more respect for the contributors of Southern Weekly than anyone I have read in Newsweek, since the former did so in an extremely hostile environment. As a Chinese journalist myself, I am amazed at the good work the weekly pulls off week after week.

    Business-wise, it's not a good idea for anyone to buy US print media at this point, but Southern Daily Group could have been a soft power to go AGAINST the Chinese government's propaganda.