Alibaba to buy South China Morning Post: Q&A

Alibaba founder Jack Ma – now the richest person in China – waits for his company’s stock to go live on the floor at the New York Stock Exchange in September (AFP/Getty)

What's going on here?

Alibaba, the Chinese e-commerce platform, has confirmed that it will buy the South China Morning Post, a widely read English language newspaper in Hong Kong for an undisclosed sum.

The deal includes licences for other Hong Kong media including Elle, Cosmopolitan and Harper's Bazaar.

That sounds like a weird acquisition.

Right. The South China Morning Post is around 100 years older than Alibaba. And they're in very different businesses. Alibaba is an e-commerce site. It connects exporters with companies around the world, so businesses can get products shipped. It contains several shopping sites and alipay.com, which is the equivalent of PayPal.

Alibaba already has a stake in Weibo, China's version of Twitter, and Youku Tudou, which is like YouTuve.

The South China Morning Post is a legacy print publication in Hong Kong. What's more, it's in English.

Why is Alibaba interested then?

In a letter to readers, Joseph C. Tsai, executive vice chairman of the Alibaba Group, said that they wanted to marry Alibaba's technology with the "deep heritage" of the South China Morning Post.

"We see a compelling business case for the acquisition because we believe that Alibaba is best positioned to take the SCMP to the next level. The foundation for this work must be the quality of the content. And what underpins this will be editorial excellence: a clear pre-requisite to maintaining readers’ trust and, ultimately, achieving commercial success. Be assured, we get that," Tsai said.

Any changes afoot?

Almost certainly. Alibaba said it will take down the paywall on SCMP.com that is wants to dedicate "additional resources" to the paper.

Won't this compromise South China Morning Post's editorial independence?

Alibaba says no.

You're probably thinking that Alibaba would say that, but: "In fact... we think the world needs a plurality of views when it comes to China coverage. China’s rise as an economic power and its importance to world stability is too important for there to be a singular thesis," Tsai said.