WSJ: Hong Kong' s Muzzled Media

Major Business News

The Hong Kong government likes to cite the free flow of information that comes from a lively media as one of the benefits the city offers in comparison to other cities in the region, such as Shanghai and Singapore. But this advantage is fast disappearing.

Consider first how Li Ka-shing, the city' s most famous tycoon, has been moving into the media business and changing the culture of editorial independence. A close friend of both Beijing and Chief Executive Tung Chee Hwa, Mr. Li controls so many companies that locals like to joke that for every dollar they spend, five cents goes into Mr. Li' s pocket. From ports to electricity to telephone companies, but most importantly the property market, his businesses have a major share of almost every sector of the local economy.

His holdings now include Metro Radio, a local station, and a growing number of other media outlets. Over the past few years his former Internet arm Tom.com has been reinventing itself as a media group in order to survive the collapse of the dot-com bubble, buying up popular Chinese magazines and changing its name to the Tom Group.

In recent weeks, Hong Kong has been alive with controversy over Mr. Li' s most audacious yet attempt to move into this market, by buying a sizable stake in Asia Television. Under normal circumstances the failing television company, which runs a distant second among local audiences, would be the perfect target for a takeover and an application of what has been called Mr. Li' s "Midas touch" in turning companies around.

But critics expressed concern that allowing Mr. Li to buy ATV would jeopardize free reporting of the many issues affected by his business and political interests. Tom Group finally scrapped the deal on Monday, ostensibly because they had been unable to "conduct due diligence." And as the deal was falling apart, evidence emerged to suggest that concerns about the potential effect on the already shaky state of press freedom in Hong Kong were fully justified.

Last Friday, Metro Radio fired its managing editor, Paul Cheung, one day after he had rejected criticism from the station executives of its extensive coverage of the conviction of 16 Falun Gong protesters by a local court, a verdict many fear marks a blow to freedom of assembly in Hong Kong. Metro issued a statement insisting the dismissal was purely due to cost-cutting considerations, and last night refused repeated requests to elaborate.

Mr. Cheung told us in an interview yesterday that his sacking followed repeated rows over news coverage, in which his immediate bosses ordered him to tone down criticism of not only Mr. Tung and the Hong Kong government but also Hutchison Whampoa and Cheung Kong, Mr. Li' s two flagship companies. There is no evidence that the tycoon was personally involved in any of these attempts at censorship. But Mr. Li' s interests are so pervasive that the policy affected coverage of everything from an electricity company' tariff increase to a protest by villagers affected by a proposed property redevelopment.

The dangers of such conflicts of interest are why some respected media companies enforce a rigorous separation between ownership and editorial
content. In the United States, for instance, publications and television stations controlled by AOL Time Warner have given extensive, and often critical, coverage to the problems facing the troubled media group.

But as prominent local journalist Willy Wo-Lap Lam observed on this page two years ago, in Hong Kong there is rarely such a "church-and-state boundary" between owners and the newsroom. When he wrote that, Mr. Lam had just been removed as China editor of the South China Morning Post, Hong Kong' leading English daily, which is owned by Robert Kuok, another tycoon who has close ties to Beijing.

Since then we have documented on this page how the Post has pursued a measurable attrition against its more outspoken contributors, most notably in April' s sacking of Jasper Becker, its former Beijing bureau chief. (Full disclosure: Danny Gittings, one of the others forced out, has since joined our editorial page). In recent weeks, the turmoil has intensified with the paper scrapping, at least temporarily, the post of editor and installing Thaddeus Beczak, a banker with no journalistic experience, to head all its operations.

Fears of self-censorship in Hong Kong have so far focused on the toning down of criticism of China. That is still a concern. It was highlighted again this week when Radio Television Hong Kong, the government-owned broadcaster that is supposed to enjoy editorial independence, scrapped plans to interview Taiwan' Vice President Annette Lu, the bete noire of Beijing. RTHK insisted this was simply because it couldn' contact her in time for the program. But the decision followed intense criticism of the proposed interview by pro-China forces in Hong Kong and a phone call to the station by one of Mr. Tung' top aides.

But it is only part of the story. At the Post, Mr. Beczak' s appointment has led to expressions of concern about the blurring of the boundaries between editorial and advertising. And at Metro Radio, Mr. Cheung' s account suggests that such boundaries were crossed with a vengeance, as the proprietor' commercial interests led to repeated interference in news coverage.

That is hardly a problem confined to Hong Kong. But the territory' s media has a particularly vital role to play in highlighting threats to freedom after the handover to Chinese sovereignty. That is a function it has performed with some success in the past, but the vibrancy and independence of local media is clearly fading. Last week' s conviction of the Falun Gong protesters, for instance, passed without criticism in most of the city' s newspapers (with the honorable exception of the Post, despite its timidity on other issues). Hong Kong' watchdogs are rapidly being defanged by their owners.