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Taiwan's Media Shake-up

United Daily News: Increasing 'Gold Content'


The age of the "intellectual newspaper" is over, as the rag trade now keeps its eyes firmly fixed on the bottom line. How can the United Daily News Group enhance its intrinsic value and pump up profitability?



United Daily News: Increasing 'Gold Content'

By Yi-Shan Chen
From CommonWealth Magazine (vol. 416 )

The hubbub of Taipei's modern, glitzy Xinyi District gives way to a serene calm as soon as one sneaks behind the rows of bamboo that shield the United Daily News Building against the noisy street. But the 58-year-old media group's calm facade belies the dramatic upheavals it has seen in recent years.

"The 'intellectual newspaper' – that's something that vanished a long, long, long, long time ago. I'm afraid that nowadays the only one left running a newspaper based on pure ideals is [former Taiwan vice president] Annette Lu with her Formosa Post," says United Daily News (UDN) spokesman Hsiang Kuo-ning, betraying a certain nostalgia for the newspaper business of the good old days.

Times have changed, and Hsiang is aware that in these economically difficult times newspaper publishers need to seek solutions from the business management side. Consequently, the UDN Group last year launched a major restructuring drive.

In October, Duncan Wang, a grandson of UDN founder Wang Ti-wu and current UDN Group president, re-recruited James Yang to serve as CEO of the conglomerate's new finance media subgroup, which includes the Economic Daily News, several business magazines and the Group's newly founded event management business. Yang, who holds an MBA and is known for his rigor and efficiency, got his start in UDN's sales division and had later been poached by Hong Kong tycoon Li Ka-shing's Cite Media Holding Group.

"The Internet least affects the financial media. They are the most valuable segment," says Yang frankly. "My mission is to increase the 'gold content' of this segment."

Hoping that the golden prospects of the financial media will rub off on the entire media group, the new entity was named "Gold Media Group."

Another upcoming major change is that the group's newspaper arm will move to Sijhih City east of Taipei by Lunar New Year next year. In the new location the editing desks of the United Daily News and the group's online news website ( will be merged to create a newsroom that operates around the clock with editors rotating shifts. Once web-based news and print news operations have been merged, the United Daily News will be Taiwan's first click-and-mortar newspaper company.

The changes at the United Daily News sprang from a closed-door meeting held in late 2007.

A Nielsen media survey in 2007 found that for the first time more people were browsing the Internet than reading the newspaper. As many as 54 percent of people are not reading any newspaper anymore, the survey found. Confronted with this death cross, Duncan Wang realized that a sweeping readjustment of strategy was called for, and that minor changes in content or layout were not enough to save the newspaper.

Three Major Moves

After the newspaper group spent nearly a year revising its course, three major strategies emerged: Firstly, the newspaper arm still needs to derive its major revenue from selling newspapers. Secondly, the group needs to establish a strong presence in all of the "three screens" (television, the Internet, and cell phone content). Thirdly, in the short term the UDN Group will use its superior brand image to create new revenue by organizing cultural events and writing classes. And it will boost profits with its golden goose Gold Media.

James Yang has long held the reputation of being the tireless workhorse of the UDN Group. When serving as editor-in-chief of the United Evening News, Yang posted each reporter's word count on the wall for everyone to see, always updating to the latest figures so that productivity became transparent. Except for a few hours of sleep, Yang spent virtually all his time on the job, and he needed two secretaries to organize and keep track of his busy schedule.

Under Yang's command, the younger Duncan Wang once received his initiation into newspaper management. Yang, then general manager of the United Daily News, did not spare the "little prince," as Wang was jokingly called back then. They had their first briefing over breakfast at 7:30 a.m., ate a boxed lunch during a short five-minute break and finally called it a day only at 2 or 3 o'clock in the morning. Yet the next morning, Yang would still grill Wang over the content of the day's newspaper.

James Yang's name card still carries his cell phone number, a practice he has retained from his days in the sales department. As soon as he returned to the UDN Group, Yang immediately closed down Rich magazine, which had only achieved monthly sales of around 5,000 copies. The magazine's seven editors were all granted early retirement or laid off, a move that sent shockwaves through the newspaper. Since October, Yang has already fired more than 30 employees, about 10 percent of his total staff.

"A company should be managed like river water – only with fresh water replacing the old will the water be clean," he says in explaining his personnel turnover philosophy. "The worst thing is if the water stops flowing – after a while it will start to stink."

Just before his interview with CommonWealth Magazine, Yang had a discussion with editorial department supervisors on using key performance indicators in management. He told the supervisors that news is important, but reader acceptance is even more important. He went on to say that nowadays there is no room for running an intellectual newspaper, and the United Daily News must be tested in the marketplace.

The Internet Is Key

Aside from heading the Economic Daily News, Yang is also making great efforts to build a good reputation for the group's event business unit. He notes that, thanks to the United Daily News' longstanding brand recognition and prestige, the company has been able to organize major cultural events such as an exhibition of works by French realist painter Jean-Francois Millet, an Ice Age mammoth exhibit, as well as performances by the renowned Cirque du Soleil. All the seats for the circus performances, for instance, sold out within two weeks. Thanks to this good box-office record, the Canadian entertainment company has invited the UDN Group to act as its general agent for Asia.

The group's current strategy aims to take advantage of Gold Media's profitability to buy time for the United Daily News to develop a new business model.

The UDN Group continues to harbor ambitions to acquire a television station. However, presently the asking price for quality TV stations is so high as to make recovering the investment extremely difficult, and for the time being, the plan has been put on hold. But although the UDN Group does not own a TV channel, it still intends to invest in film studios and television programming.

Presently the group's website plays an important role in redirecting people's attention back to the print newspaper. Alvin Liu, managing director of Co. Ltd., which runs the website, has observed two major trends that hampered the website's development in the past: it provided little realtime news and not enough video clips. Therefore, all reporters working for the newspaper had to take classes last year to learn how to write realtime news and shoot video clips. As a result, the website now posts about 500 news items per day and some 800 news videos per month, which has boosted website traffic by 25 percent.

When the combined editing desk has been set up by Lunar New Year next year, the media group's Internet presence will play an even greater role. Liu explains that in the future reporters will no longer have fixed deadlines for handing in their articles, and editing will no longer distinguish between web-based news and print news. News will be published realtime as it happens to all group media, be they the website or the morning or the evening newspaper.

"Reporters will also need to change their working habits. They will probably first have to post a news flash or preliminary news report on the website and move a final version after putting more information together. Then a polished special report will be published in the newspapers on the following day," Hsiang projects.

But given that the Internet has already severely eaten away at newspaper circulation, doesn't the UDN Group risk beating itself at its own game? "This is certainly a dilemma, but if the website draws people's attention, at least our advertisement revenue will rise," says Hsiang with cautious optimism.

Even within the UDN Group, people have doubts that the new strategy of selling events and investing in an online presence will have the desired results.

"We're groping our way across the river, but what we know for sure is that we need to change," Hsiang frankly admits.

Translated from the Chinese by Susanne Ganz

Chinese Version: 提高《聯合報》的含金量