Chinese Communist Party officials are increasingly concerned about the tech giant’s influence on public opinion and have asked Alibaba Group to sell its media business, the Wall Street Journal said, citing people familiar with the matter. Alibaba owns Hong Kong‘s South China Morning Post, and stakes in several Chinese media and social media platforms.
Alibaba Group, founded by wealthy Chinese businessman Jack Ma, is in the crosshairs of Beijing‘s anti-monopoly campaign. Officials have been reviewing Alibaba’s media list since earlier this year and are alarmed by its media footprint expansion, the newspaper said, citing people familiar with the matter. Officials have asked Alibaba to come up with a plan to significantly reduce its media assets.
Alibaba’s huge media presence is seen as a huge challenge to China’s Communist Party and its propaganda system, people familiar with the matter said.
The newspaper also compiled a list of Alibaba’s media investments, including its 100 percent ownership of Hong Kong’s English-language South China Morning Post (SCMP), nearly 37 percent of Chinese media outlet First Financial Group, and nearly 30 percent of social media platform Sina Weibo. “The list includes 100% ownership of Hong Kong-based English-language media outlet SCMP, nearly 37% of Chinese media outlet First Financial Group, nearly 30% of social media platform Sina Weibo, and 6.7% of video platform Bilibili.
Alibaba’s Ant Group owns 16.2% of the technology media outlet 36 Krypton. Alibaba also owns 5% of state-run Hunan TV’s Mango Super Media and 5.3% of China’s largest advertising network, Focus Media.
The report said it was not yet known whether Alibaba would need to sell all of its media assets. All of Alibaba’s proposed plans would need to be approved by China’s top leadership, sources close to the situation said.
Alibaba declined to comment on the matter, the report said. In a statement, Alibaba referred to itself as a passive investor in the media assets.
The statement asserted that Alibaba’s investment in these media companies is to provide technical support to upgrade their businesses and to achieve commercial synergies with Alibaba’s core business. Alibaba stressed that the group does not interfere in the day-to-day work and editorial decisions of these media outlets.
The report argues that giving up its media footprint is not necessarily a bad thing for Alibaba. By giving up some of its non-core businesses, Alibaba may be in a “safer position” and be reborn from the regulatory onslaught. The move may also allow Alibaba to avoid political minefields in the future as officials tighten their grip on the media.