Red Infiltration: The Reality of China’s Global Media Expansion (Part 1)

This is the first part of a translation from the original 紅色滲透─中國媒體全球擴張的真相, an excerpt of the book by He Qingilian (何清漣), a Chinese economist and author. Originally published by Voicettank. Translation by Tim Smith.

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Long before Want Want Holdings Ltd. founder Tsai Eng-meng acquired the China-Times Media Group, the Chinese Communist Party (CCP) had already been infiltrating Taiwan’s media industry through various means. (Editor’s note: Want Want is a Taiwanese food conglomerate with a heavy presence in China, and the China Times is one of four major daily newspapers in Taiwan. China Times was considered moderate in its political bias, but since being purchased by Want Want its editorial direction has skewed closely with CCP propaganda.)

The CCP’s endeavors to infiltrate Taiwanese media began at the beginning of the new millennium. Prior to 2008, the CCP exerted influence over Taiwanese media indirectly, mostly via buying up shares in Taiwan’s media companies with money from Chinese investments in third countries. After 2008, Taiwanese businesses with investments in China, which also had an intimate relationship with China’s government, were the main proxies for the CCP.

Dr. Flora Chang, a professor with National Taiwan University’s Media Research Center, has summarized this as the “China Factor” in Taiwanese media. She observes that “Chinese control is exercised by companies with close ties to the CCP that are technically private enterprises, which can invest in media companies through legal channels.”

Legal as they may be, Dr. Tai Yu-hui of Taiwan’s National Chiao Tong University discovered that these Chinese private investors were in fact acting under the direction of the CCP, which also provided the necessary funds through state-owned banks. The chain of influence goes from Chinese state-owned banks to China-based private enterprises, and then to offshore companies which then buy up shares in Taiwanese media. The China-based private enterprises in turn expand their control overseas as well as become connected to top government brass for doing them a favor, which are all business advantages for the enterprise.

Before 2008: Under cover of darkness

As early as 2003, senior journalist and vice-editor of the Economy Daily, Yang Shih-jen, had exposed Chinese investment into Taiwan’s media industry. On January 19, 2003, Yang published an article in Taiwan News’s Economy and Culture Magazine titled “Domestic Newspapers, Magazines, TV Stations, and Other Media Accepting CCP or Chinese Investments.” In this article, he reported that 17 media groups had accepted Chinese investment or had been heavily infiltrated by China, including eight print-media companies, four electronic-media companies, three weekly periodicals, a publishing house, as well as one scientific magazine publisher.

Among them is a major print media company with a long history: the China Times Cultural Group. The China Times Cultural Group sold shares of itself in the amount of USD $37.18 million, or about NTD $120 million, in September of 2001, to a British Virgin Islands-based company called Newslink Investment. This company is an offshore entity funded by money from China. Both parties agreed that the investor had options to purchase more shares in the future. In return, China Times was allowed to set up bureaus in both Beijing and Shanghai.

China Times has a very close relationship with China’s government. Its higher-up personnel frequently travel to China, meeting with Taiwan Affairs Office official Zhang Mingqing as well as the Xinhua News Agency, China News Service, Beijing Daily, and other CCP mouthpiece media groups for the promotion of various collaboration projects. Aside from China Times establishing bureaus in China, it was permitted to deliver more than 10,000 daily copies for Taiwan affairs officials of the CCP and a few Taiwanese businesses, but was not allowed to directly publish in China.

The relationship between another Taiwan-based media conglomerate, United Daily News (UDN), and Beijing is also quite cozy. The People’s Daily once reported that the Standing Committee of the Political Bureau of the CPC Central Committee and the chairman of the National Political Consultative Conference, Jia Qinglin, met UDN’s president, Wang Wenshan, at the Great Hall of the People in Beijing as a member of a Taiwan Joint Newspaper Delegation. Jia Qinglin praised Wang and UDN’s efforts towards “cross-straits exchange.” According to Yang, UDN was also heavily financed by Chinese investment, namely by The PKU Founder Group’s Founder Technology Inc., which was incorporated in the British Virgin Islands.

As for broadcasting, China’s Xinhua News Service has also exploited the indebtedness of a certain TV station and a website in Taiwan, and injected an estimated US $50 million through two non-Taiwanese website companies. Before this deal, this Taiwanese company had already collaborated with local TV stations in Hunan province and Suzhou, Shanghai, Beijing, and other areas in China. They purchased programming from each other and worked on joint-productions.

Effect on Taiwan’s politics

This kind of secret control of Taiwan’s media by Chinese investors under the purview of Beijing has played an extremely significant role in Taiwan’s politics. In August 2005, Taiwan’s TVBS media group was the first to expose a corruption scandal involving Thai migrant laborers’ protests and the Kaohsiung Metro. The story, under pursuit by TVBS host, Li Tao and others, kept snowballing and finally evolved into an anti-corruption case.

The pro-Taiwan Democratic Progressive Party (DPP) was in power at the time, led by then-president Chen Shui-bian. The scandal turned out to involve President Chen, his wife Wu Shu-chen, Kaohsiung mayor Frank Hsieh, Chen Che-nan (vice-secretary to former president Chen), Chen Min-hsien, Chen Chu and other high-level governmental and party personnel, and the DPP became the target of massive public discontent. China’s own media dubbed this incident “Taiwan’s Watergate,” shaking the foundations of Chen Shui-bian’s government.

TVBS, officially registered as Liann Yee Production Co., Ltd., was owned by two shareholding entities. The first shareholding entity was the Bermuda Merchants Television Broadcasting Investment Co., Ltd., holding 47% of TVBS stocks, and the second was the Taiwan-registered company, TVBS Holdings Inc. (東方彩視投資股分有限公司), with 53% of TVBS stocks.

At a glance foreign investment doesn’t exceed 50%, abiding by the regulations of Article 10 of Taiwan’s Satellite Broadcasting Act. However, a closer look at TVBS Holdings Inc.’s shareholders and investors reveals another story. The shareholders of TVBS Holdings Inc. were: Chairman Fei Tao-i, Directors Tang Chi-teh, Chen Yu-hsiang, and Supervisor Cheng Sung-tai. These four are all board members of Bermuda Merchants Television Broadcasting Investment Co., Ltd.

In other words, in practice, TVBS is 100% controlled by people connected to Bermuda Merchants Television Broadcasting Investment Co., Ltd., even if on paper there is a Taiwan-registered majority shareholder. Furthermore, Bermuda Merchants Television Broadcasting Investment Co., Ltd. is none other than a Chinese investment firm founded in Hong Kong. The CEO of TVBS was Norman Leung; from 1997 to 2002, he was the chairman of Hong Kong’s Broadcasting Authority.

Before 2008, the administration in Taiwan was considered to be China-skeptic, and so Chinese investment into Taiwan’s media industry had to be done under the cover of offshore shell companies. When the China-friendly Chinese Nationalist Party (KMT) won the presidency in 2008, Chinese investments could come into Taiwan in broad daylight.

Chinese Communist Party’s total control of Taiwanese media

In 2008, the KMT’s Ma Ying-jeou became president and the KMT and its affiliated parties won elections across the board. The Chinese side intensified its incursions into Taiwan’s media landscape. An iconic example of this is Want Want Holdings Ltd.’s acquisition of one of the leading media groups of the time: China Times Cultural Group.

Want Want is a brand famous for making snacks, and the conglomerate has immense market interests in China. The company is known for being heavily pro-China and pro-CCP. The company’s CEO, Tsai Eng-meng, used personal investments of up to US $661.3 million to buy out the China Times Media Holdings Group’s flagship China Times (中國時報), Business Times (工商時報), Times Weekly (時報周刊) newspapers and CTiTV (中天電視), as well as China Broadcasting Corporation (中國廣播公視), among other media outlets and publications. The change in ownership of China Times newspaper in nearly 60 years was the most significant change in Taiwan’s media history.

Tsai Eng-meng, who up to this point showed no interest in the media industry at all, bought a 49% share in Hong Kong ATV, a company that was already drowning in financial losses, just three months following the purchase of China Times group.

While it is unclear where Tsai’s funding comes from, Tsai proudly flaunts the fact that he is Beijing’s lapdog.

On December 5th, 2008, merely a month after buying China Time’s Holdings Group, Tsai Eng-meng met Wang Yi, the director of China’s Taiwan Affairs Office (TAO). Tsai said the purchase was intended to “exploit the power of mass media to promote closer cross-straits relations.” Wang replied, “let us know if you need any help, the TAO will fully support you.”

This meeting was originally supposed to be a closed door meeting, but an internal publication within Want Want Holdings in China, Want Want Monthly, ran a short article with a photo of Tsai and Wang. Taiwan’s Commonwealth Magazine then took this article as a source for a piece in its 2009 Issue 2, with the headline “Sir, We Bought China Times For You.” The piece shows the photo of Tsai meeting Wang, describing Tsai “sitting up straight on the edge of the chair, his hands respectfully folded on his lap” to satirize the fact Tsai is merely a subordinate of the TAO.  Tsai is captioned as saying to Wang, “we’re going to follow your orders from the higher-ups and tell everyone about the prosperity of the motherland.”

Tsai invested billions into China, using China early on as the core of his snacks business empire. After his entry into the media field, he started telling people what or what not to publish. For example, he demanded an increase to the amount of reportage on China; he demanded that China’s role in the 228 Massacre be highlighted as that of a “hero.” He demanded that these media groups strongly support president Ma Ying Jeou, tone down their criticisms of Ma, as well as always redact even the slightest approving attitude of Taiwan’s former president Chen Shui-bian, who preceded Ma.

Tsai Eng-meng turned China Times Group into a pro-CCP form of capital. Following his buyout of the China Times, CTV, and CTi, high-level government personnel and business peers from China were frequently invited to tour CTi, with up to two or three groups per week. There was a director of CTi who joked that he spent so much time entertaining Chinese guests that he had less than 10 minutes a day to do his own work.

Tsai sees government officials as the bosses and the people as the employees in a company, even in a democratic society. Tsai required that China Times “not criticize the president or [KMT] government officials” because “when the boss is bad, you should leave the company instead of badmouthing your boss. President Ma is like a boss that everyone elected, so I think we shouldn’t criticize him.” During one morning newscast, TV anchor Huang Peng-jen, while quoting a newspaper headline, called Ma Ying-jeou a “homebody president” on TV. Tsai went into a rage and severely reprimanded Huang.

Since then, China Times, as one of the leading media groups in all of Taiwan, had evolved into a very peculiar reporting style: even though it would sometimes criticize Taiwan’s government, it mostly became a massive propaganda cheerleader for China. Professor Yen Hai-yuen from the social studies department in Academia Sinica notes that while China Times joined in on the criticism of Ma during his first six months in office when public opinion support for him started to dip, this is only because other Taiwanese media outlets were also making criticisms and it was impossible for them to try to stick out like a sore thumb with blatant, fake numbers of support. However, the China Times newspaper, CTiTV, Want Want Times, and other media, under the control of Tsai’s China Times Holdings Group, were “acting with all their might as a propaganda mouthpiece to bolster China,” posing a greater threat to Taiwan.

After Tsai took over the China Times Culture Group in 2008, he only allowed for positive coverage of China, and nearly refused to report on any of the human rights abuses carried out by the Chinese Communist Party. Tsai once publicly declared that “saying that China doesn’t have human rights is twisting the facts…take a look at the Sichuan Earthquake. The way the Chinese authorities are saving people, why, they’re doing a far better job than the Americans did in New Orleans. So which country is worse?”

During the year after the 2008 Sichuan Earthquake, Chinese rights advocate, Tan Zuoren, was arrested and sentenced heavily for “plotting against the government,” only because he wanted to find accurate number of deaths. Fu Jen University media broadcasting professor, Chen Shun-hsiao, did a comparative study of several media outlets and concluded that while CNA and Liberty Times had both reported on this, China Times’ database seemed to be completely absent of any reporting on the issue. During the same time period, China Times’ media outlets were strongly emphasizing Chinese president Hu Jintao’s statement that Sichuan’s rebuilding would be “accomplished” ahead of time. Chen also expressed deep alarm at China’s investment into Taiwan, explaining that even with Taiwan prohibiting direct Chinese ownership in Taiwanese media, Chinese investments can still “collaborate” with willing Taiwanese media companies, spreading Chinese propaganda without the public knowing who’s behind it. It’s more dangerous than simply making The People’s Daily available in Taiwan.

Beijing was even able to influence internal HR decisions in Taiwan’s media industry. Take for example in December 2009, when the editor-in-chief of China Times, Hsia Chen, published an article on December 26th, which led to her being fired.

The story is as follows: during the second meeting between SEF chief Chiang Ping-kun and ARATS chief Chen Yunlin, the quasi-official representatives of Taiwan and China respectively, Taiwanese party leaders rushed to meet Chen Yunlin, the Chinese representative. The China Times’ headline called Chen a “C-level bureaucrat” and mocked “A-level leaders” from Taiwan fawning over him. Soon after, Hsia was forced to leave her job.

Some people were dismayed, remarking that China Times had become so pro-China that it’s pretty much The People’s Daily’s Taiwan edition. Just calling out China’s representative as a C-level bureaucrat means canning the editor-in-chief? Taiwan is not even annexed under China, and this is how our media kowtows to Beijing. If China were to one day take over Taiwan, how do media companies now think they’ll survive?

Even worse, media companies with Chinese investors even imported the Communist Party’s reeducation techniques to train their employees. Liang Mali, the Chairman of Eastern Home Shopping & Leisure Co., Ltd., a shopping network affiliated with ETTV, was reportedly a Communist Youth League member. His father was a PLA military cadre. When Liang Mali held meetings at ETTV, he demanded that the managers read Mao Zedong’s Quotations.

This kind of outright brainwashing straight from the Communist Party has already been long-abandoned even in China. Liang took Maoist party discipline techniques to a newsroom in Taiwan, so he can dumb down the employees’ ability to think. Montesquieu’s said, “the educational goals of all autocratic states are to greatly diminish the knowledge and awareness of their citizenry.”

After getting a taste of how easy it is to control Taiwan’s politics through the media, in April 2009, China’s national administration of media publishers announced “a reform of news publishing controls,” with international exchange as one of the main goals. This marks China becoming much more vigorous in promoting its own narrative abroad, by mobilizing all its resources to push its own media brands in the Western mainstream media market, as well as the international Chinese language market, and in “Greater China,” encouraging Chinese media companies to publish in Taiwan outright.

(To be continued)