During the last four weeks, many people have brought more than one newspaper. Why is there a sudden interest in the news? It is because of the recent price war of newspapers.
On December 9th, the Oriental Daily News broke ranks with the Chinese-language press, which has charged a uniform price of $5, and lowered its price to $2. After that, many other newspapers like the Apple Daily and the Tin Tin Daily News have also lowered their prices.
Last week, the newspaper Society formed a special committee to lobby for an end to the price cuts. It has been suggested that newspaper prices in Hong Kong should be fixed. However it is also thought the prices of newspapers are lowered, the quality of newspaper may be improved because of the competition between newspapers in the marker. Also for people who can buy cheaper newspapers, this will either decrease their expenditure or allow them to look at more than one paper. However, from my point of view, I think the proposal to fix prices of newspaper is good. There are several reasons for this.
Firstly, when there is no fixed price, there will be an opportunity in the market for the arise of a price war which will indirectly affect the economy of Hong Kong. In the price war which emerged last month, thousand of millions dollars were lost by firms because the cost price of producing the newspaper is greater than the selling price!
Secondly, the cutting of prices has meant that newspapers create unemployment because of financially worries. Some newspaper's firm, like Fa Po News, has gone bankrupt and been closed down. The people who worked in that firm, like the reporters and editors, are now unemployed. Since this is a specialized profession, the newspaper staffs find it hard to get another job, especially in today's economic climate.
Thirdly, the price war also affects market magazines. Since people buy more than one newspaper, they have no time to read the magazines so the demand for magazine decreases which affects their revenue. Shi Sun Magazine is a recent bankruptcy victim of this cycle!
Fourthly, in a price war the biggest and most powerful groups survive and smaller papers go under. It is a war of financial strength, not quality. However, the smaller newspapers of limited circulation often deal with different topics such as politics or economics whereas many big papers concentrate on producing what the masses want. Therefore, if the price war continued, the small firms would gradually close down and the public would not be able to see some special topics from the newspaper that the smaller firms provide.
Fifthly, a fixed price gives all newspapers an equal chance to cover the news in their individual way without concentrating too much on the strong-arm tactics of the big groups. This provides the public with a wider range of opinion. If price wars are taken to their limit, this may result in a monopoly or a couple of groups seizing the market. Considering the influence of the media, such a narrow source of information is detrimental to the public interest.
Sixthly, the greater the demand for newspapers, the greater the demand for paper which can only be bad for the ecology of the world!
Because of the above consequences
of price war, I hope the committee can lobby successfully the newspaper
producers to cease the price war. I also hope the government can impose
a fixed price on the newspaper's price, too, so that it can avoid the reappearance
of the price war!