Nikkei Inc.’s surprise purchase of the FT Group prompted many to worry that the Japanese firm would interfere with the British-headquartered company’s editorial policies after the acquisition.
Nikkei, the leading financial media outlet in Japan, announced late last Thursday that it will buy the publisher of the esteemed London-based Financial Times newspaper for ¥160 billion, or $1.3 billion. (The last several months has marked a record period of overseas acquisitions by Japanese companies, but this is one of the first major ones in the media industry.)
A Japan Times article quoted media analyst Takashi Kawachi, who said that FT’s robust online readership would help Nikkei compensate for its dwindling newspaper circulation, adding: “Over the past 10 years, the total circulation (of newspapers) has fallen rapidly in Japan and the most avid readers now are mostly in their 70s. There is no doubt digitization and advancement into overseas markets are the only ways for Japanese newspaper companies to survive.”
However, other experts are far more skeptical about the acquisition, citing Nikkei’s poor reputation for holding corporate Japan accountable. Hiroko Tabuchi, a New York Times reporter who formerly worked as a Tokyo correspondent for The Wall Street Journal and The Associated Press tweeted that the deal is “Worrying. Nikkei is basically a PR machine for Japanese biz; it initially ignored the 2011 Olympus accounting scandal (which FT broke)” She also tweeted that “Nikkei has also hardly covered the Takata airbag defect; almost no investigative work on that issue whatsoever. Nikkei *is* Japan Inc.”
Meanwhile, Michael Woodford, the whistleblower on Olympus’s $1.7 billion accounting fraud, told the Times “The Nikkei is known as the corporate voicepiece of Japan and has a notorious reputation for being leaked [price-sensitive] company information. In contrast to the FT, which broke the news [of the Olympus scandal], the Nikkei was like the public relations office for Olympus.”
But Nikkei Chairman Tsuneo Kita said such concerns were unfounded, before pledging at a news conference on Friday: “I’d like to clearly say this: Independence of editorial policies, which is the most important thing for a news organization, will be maintained as has been in the past.” However, Kita would not commit to placing such pledges in the acquisition contract, leaving many detractors to question his sincerity.
In an editorial, The Guardian also voiced its concerns about the acquisition, but said that the deal was nonetheless “a fascinating development in the globalization and digitization” of the newspaper industry, adding that Japanese newspaper “subscribers are getting old” and “the habit of print is weakening.” The editorial’s author added that as the Japanese publisher hopes to boost its dwindling readership and upgrade its practices “it makes sense for Nikkei to spend its cash on one of the few really successful global digital brands.”
But Ritsumeikan University media studies professor Ryosuke Nishida just hopes that those updates in business practices can also be coupled with modernized moral policies, in an age when soft reporting on corporate Japan can no longer suffice. As he explained it to The Japan Times: “Japanese newspaper companies are very inflexible, and their reporting methods have become outdated. Whether (Nikkei) can capitalize on the experience (of the FT), which has carried out many drastic reforms, is the critical question.”