The Guardian view on media globalisation: good news for the Financial Times
Editorial
It may not prove easy to marry British and Japanese journalistic cultures. But in a global media world this deal makes sense
‘The Financial Times is unequivocally on the side of shareholders; Nikkei only questionably so.’ Photograph: Peter Nicholls/Reuters
Thursday 23 July 2015 15.09 EDT Last modified on Thursday 23 July 2015 20.14 EDT
The Financial Times is one of the best newspapers in the world, not just in Britain. It is quick without being rash, accurate without leaden pedantry, thoughtful without being ponderous, and unpredictable in its opinions without being tediously contrarian. On top of all that, it even makes money. So its sale to the Japanese newspaper publisher Nikkei is a matter of global interest in the media business, and a fascinating development in the globalisation and digitisation of our industry. As a newspaper market, Japan has many advantages over the English-speaking world. Newspaper circulations are huge: the two biggest broadsheets sell 9m and 7m print copies a day, while even the Nikkei newspaper, Japan’s equivalent of the Financial Times, sells 3m broadsheet print copies a day – compared with 2m for the tabloid Daily Mail in the UK and a mere 200,000 for the FT itself.
These subscription figures, and the unparalleled delivery system that makes them possible, have so far cushioned the Japanese industry from the advertising slump. Fiercely competitive local distributors keep almost every household supplied with a daily paper, which is thus woven into the fabric of everyday life. Barriers of language, culture and technological ecosystems all tend to preserve this uniquely profitable media market. But Japanese newspaper subscribers are getting old. The habit of print is weakening. More and more people read on their smartphones. Students today hardly ever subscribe to newspapers. It makes sense for Nikkei to spend its cash on one of the few really successful global digital brands. The Financial Times is almost unique in the English-speaking digital news business in funding its digital operations in a rather Japanese way, by charging subscriptions rather than relying on advertising. And it manages the trick, too, by supplying reliable information entertainingly that allows readers to make decisions that they hope will make them money.
Pearson, the previous owner of the FT, wants to concentrate on its educational business, despite recent setbacks. It has kept the 50% of the Economist that it owns. So the deal makes sense from that end, too. But what about the readers of the paper, and the people who work there?
One of this week’s big business stories has been the scandal at Toshiba, where earnings were inflated by 152bn yen (£780m) over the last decade, and which shows the potential conflicts between British and Japanese attitudes to financial scandals. The pressures on companies in both countries are similar: if the bosses demand impossible performance figures, there is a temptation for their subordinates to cook the books rather than admit failure. But in Japan this is often regarded as a more or less victimless crime. In Britain and America the interests of the shareholders are paramount, and they see the crime as one with real victims – shareholders, who are deprived of the accurate information they need to make the most profitable decisions. The Financial Times is unequivocally on the side of shareholders; Nikkei only questionably so.
The last really big corporate scandal in Japan, when Olympus was found to be concealing losses of $1.3bn, resulted in the unceremonious sacking of the (English) chief executive who revealed it. The Financial Times broke the story; Nikkei did not cover it until it became wholly unavoidable. Nor would readers of Nikkei be acutely aware that Japanese-made airbags have been blowing up in the US since 2004, a story that has long preoccupied the New York Times. Mainstream Japanese journalism is not corrupt, but it is respectful, like the culture around it. Anglo-Saxon journalistic traditions are not, at their best, respectful of anything. There are some things that British newspapers should respect more, such as privacy, but it is also possible for respect to shade into the kind of incurious deference to power which lets scandalous behaviour flourish.
So there are obviously ways in which the deal might go wrong. But it is at least as possible that it will go right. The better parts of each company’s culture will come to influence the other. The world needs journalism that is both measured and punchy and the FT is today one of the papers that best supplies it. That in turn can only be sustained by a profitable business. Nikkei has the capital and the Financial Times the global reach, the language and the knowhow that could combine to build a media business that can make a profit from quality even in the digital age.
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