Xinhua Bookstore To Sell Shares To Private Investors
Xinhua Bookstore, owned by China's official Xinhua News
Agency, plans to sell shares in its retail book chain
to private investors, including non-Chinese companies.
Xinhua plans to retain at least 40% of the stock of the
company. This marks a further move in China's policy of
reducing the government presence in media, and ceding
a portion of the control to private companies and organizations.
Major western media groups including Bertelsmann AG,
Time Warner Inc. and Viacom Inc. are poised to enter the
Chinese market as government controls are eased. The Chinese
government is easing control because of WTO requirements,
and also to breathe life into the sector.
As China becomes more urbanized and the working population
becomes younger, readership has fallen off. The western
media groups have experience working with different kinds
of media content, and merchandizing it for electronic
and print media.
Xinhua News Agency also checks all content, insuring
that all content published in print media falls within
government guidelines.
Xinhua News Agency has held a government monopoly on
content and distribution for 50 years, but has had trouble
shifting to a more market-oriented economy. The Chinese
government split it into two parts: operations and content
several years ago, with operations forced to operate as
a profit-making entity. So far, it has not been able to
become profitable.
Privatizing operations, it is hoped, will attract improved,
more business-focused management, instead of relying on
government bureaucrats. By brining in professional management,
it is hoped that the government representatives will become
more business- and profit-oriented.
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