Move into TV does not pay off for Next Media

Beijing:Next Media Ltd, the Hong Kong publisher controlled by Jimmy Lai, reached an agreement to sell its unprofitable Taiwan TV business to the chairman of rival ERA TV.

Next signed a MoU with Lien Tai-sheng to sell Next TV Broadcasting Ltd, group CEO Cassian Cheung wrote in a memo to employees. Two employees at Next confirmed the letter.

A sale, which will include the closure of Next’s video-on-demand Internet service, comes after two consecutive annual losses caused by the unprofitable move into TV broadcasting. Next, known for its animations depicting news including Tiger Woods’s car accident and Conan O’Brien’s television career, lost HK$1.17 billion ($151 million) at its TV and multimedia unit for the year ended March 31, according to its annual report.

Services at its video-on-demand operations will cease October 31, it said on its website.

Daniel Chang, a spokesman for Next Media Group in Taipei, confirmed that Next TV signed a memorandum of understanding with Lien. “A formal contract needs to be signed by the end of this month, otherwise both need to start all over again,” Chang said. The deal will take effect January 1 if formal contract is inked, he said.

Next Media, which posted revenue growth the past two years, entered the TV business three years ago and battled with Taiwan authorities to secure licenses for its news and entertainment channels.

On September 4, the company said it’s in early talks to sell its Taiwan assets, including Next Magazine, Apple Daily and Taiwan Sharp Daily. Cheung’s letter didn’t provide financial terms for the deal and didn’t mention Lien’s company, ERA.