Alibaba Group Holding Ltd. announced on Friday that it bought the media assets of South China Morning Post (SCMP).

SCMP is Hong Kong's flagship English newspaper, which has long tackled controversial issues that most state-run newspapers are prohibited to cover. For Alibaba, acquiring SCMP is its strategy to penetrate and influence the media.

Lifting China, lifting Alibaba

Improving China's image in the eyes of the world is one of the main reasons why Alibaba bought SCMP.

The company acknowledged the biased presentation that Western media outlets are giving China. Although Alibaba said the government has nothing to do with the acquisition, the company's vision is aligned to that of the communist sector, which has recognized Western world's biased news reporting against China.

The bias that the country is being associated with influence how businessmen and other potential customers outside of China look at Alibaba. At the end of the day, all the negative reports about its home country affect the growth of the its business.

Alibaba's Executive Vice Chairman Joseph C. Tsai said the company is grounded in China and that it has influences in many aspects of the country's economy. With this, he said misconceptions about China would mean misconceptions about Alibaba.

What's At Stake

The deal between the e-commerce company and the newspaper is said to be about $100 million. With Alibaba's more than $12 billion annual revenue, the stakes are not that high.

What then is Alibaba's biggest risk as it enters into the deal?

The answer – reputation.

By owning SCMP, Alibaba will penetrate the world of politics and have control over a news team that greatly influences two borders, which are Hong Kong and mainland China.

News publication in Hong Kong is more lenient and relatively a free press. In mainland China, however, strict censorship policies are enforced and must be followed.

Editorial Changes

Tsai said Alibaba will not meddle with the daily operations of the paper, including editing and censorship processes. The paper shall maintain journalistic independence and integrity.

"We'll operate on principles," said Tsai. "We'll let the editors make their judgment on what to publish and not to publish.

Political commentator Eric X. Li, who is one of Alibaba's advisers of the venture, said the company will provide a one-of-a-kind and compelling view of China, giving international readers more accurate perceptions of the country.

Photo: Kevin Poh | Flickr

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