HONG KONG -- China's state-backed newspapers in Hong Kong, Wen Wei Po and Ta Kung Pao, announced on Tuesday that they are to merge, in order to enhance synergies in an increasingly challenging media landscape.
The two companies will continue to publish their own newspapers in Hong Kong, but will pull editorial and technical resources together to strengthen the development of new media. Jiang Zaizhong, chairman of Ta Kung Pao, will become president of the new group, which will be known as Hong Kong Ta Kung Wen Wei Media Group.
The merger is a response to a "wider trend of media convergence" to "integrate resources," and the two companies will "complement one another" as they take proactive measures to reform, the two Chinese-language newspapers said on Tuesday.
The news comes at a time when traditional media in the former British colony are plagued by dwindling circulation and declining revenues, while Chinese President Xi Jinping has announced reform of inefficient state-owned enterprises. Mergers and acquisitions are widely regarded as key ways to revitalize the country's failing state sector.
"I am sure they are losing a lot of money," said media tycoon Jimmy Lai Chee-ying, founder of Next Digital, the pro-democracy media group that publishes Apple Daily, of the deal. "People have so many choices. The time of using media to brainwash people is gone because ... information is too transparent for a lie to be convincing," he told the Nikkei Asian Review.
Wen Wei Po was originally founded in Shanghai in 1948, while Ta Kung Pao was founded a century ago in Tianjin in China. Widely regarded as mouthpieces for Beijing, the two newspapers are controlled by the central government's liaison office in Hong Kong and have lost their appeal to Hong Kong readers in recent years. Ta Kung Pao's attempt to relaunch its New Evening Post edition as a free tabloid newspaper in the city in 2012 ended in failure after only two years of operation.
In November, a notice claiming to be from Ta Kung Pao was circulated on China's Weibo microblogging website, saying that the newspaper would lay off close to 100 staff and close 21 mainland news bureaus including those in major cities like Beijing, Shanghai and Shenzhen.
Clement So York-kee, a journalism professor at the Chinese University of Hong Kong, said the merger was a "logical step" from a resource perspective because the two newspapers have "overlapping functions" serving a similar audience in Hong Kong. "Shutting down some of their news bureaus in mainland China would no doubt be a cost-saver," he said.