MEDIA: Xinhua, AP Talk Tie-Ups In Strange New Media World
Bottom line: AP’s willingness to consider new tie-ups with Xinhua is the result of economic pressures being felt by western media, but is unlikely to produce any major alliances due to the potential for negative publicity.
Rapid changes in the traditional media realm are creating some strange bedfellows, and the situation looks even stranger in China due to the strong elements of censorship and state control. That odd combination of circumstances is creating a perfect storm that has led some western media companies to do the previously unthinkable and consider partnerships with some of China’s most centrally controlled media. Recent rumors have said that global financial news leader Bloomberg may be considering such a tie-up, and now the latest reports are saying US media giant Associated Press (AP) is also open to such partnerships.
AP is less well-known to average consumers, but it’s a common name among most of the world’s top media as one of their main suppliers of news from regions where they lack their own reporting resources. AP is one of the world’s largest media, despite its low-key nature. But it has also struggled in recent years as the world’s major traditional media, which make up its main clientele, rapidly lose business to more nimble and flexible new media in the online and mobile realms.
That kind of pressure is almost certainly an important element behind AP President Gary Pruitt’s latest visit to Beijing, where he discussed potential cooperation with the official Xinhua news agency, often considered the mouthpiece of China’s ruling Communist Party. (English article) Before we go any further, I should quickly point out that the report on the meeting came from Xinhua itself, which no doubt saw the exchange and AP’s agreement to consider potential cooperation as confirmations of its own status as a major global media company.
Other Chinese government agencies, which are normally quite secretive, are also often eager to publicize such meetings with high-profile counterparts, which add to their own credibility. The country’s Internet adminstrator, the Cyberspace Administration of China, is rarely seen in public; but it was quite happy to widely publicize a trip last year to the US by one of its top officials, after he met with Facebook (Nasdaq: FB) CEO Mark Zuckerberg, Apple (Nasdaq: AAPL) CEO Tim Cook and Amazon (Nasdaq: AMZN) CEO Jeff Bezos. (previous post)
In this latest instance of strange bedfellows, Xinhua quotes its own President Cai Mingzhao saying that his organization should “forge a strategic cooperative relationship” with AP. Pruitt was a bit less gung-ho about such a partnership, but is quoted as saying “AP is ready to exchange experience and strengthen cooperation with Xinhua.” In an interesting footnote, the Xinhua report also trumpets its own recently relaunched accounts on Facebook, Twitter (NYSE: TWTR), and YouTube, even though all 3 sites are officially blocked in China.
The fact of the matter is that Xinhua and AP have cooperated for years, as each relies on the other to supplement its own news coverage. But such cooperation, which occurs frequently between news agencies, is usually limited to sharing their finished stories and doesn’t usually include actual news production. By comparison, some recent rumors have said that Bloomberg may be planning a broader tie-up with a local partner in China, and this latest report certainly seems to indicate Xinhua would be interested in a similar partnership with AP.
As a former reporter from Reuters (Toronto: TRI), a top rival of both AP and Bloomberg, I can certainly see how all of these companies might be feeling pressure to consider such tie-ups with Chinese partners they might have avoided just 5 years ago. Such tie-ups could give them much better access to China’s media market, which is tightly controlled but also has huge advertising dollars that have helped spawn such big Internet names as Baidu (Nasdaq: BIDU) and Sina (Nasdaq: BIDU).
But at the end of the day, the negative publicity any of these western companies would inevitably face from a deeper tie-up with Xinhua or any other major Chinese media could prove a huge liability, undermining their credibility and confidence of their customers. For that reason, I really don’t expect to see any meaningful China-western alliances emerge in these strange times. But perhaps we could see some superficial tie-ups that ultimately get trumpeted by Chinese partners like Xinhua, even as they get little or no publicity from their western partners.
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