Vietnamese papers battle for ad dollars p.16

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By: Lucia Moses C an Nguyen came to the United States from North Vietnam 23 years ago, fleeing an oppressive communist regime.
Today, he faces a different kind of struggle: the cutthroat world of capitalism. Nguyen, president of the San Jose, Calif.-based Vietnam Daily News, has been battling two other Vietnamese-language dailies and about seven weeklies
in Santa Clara County's burgeoning Vietnamese community of 100,000. But the dynamics have changed as a new
free paper has joined the mix.
The entry of the Viet Mercury, a weekly Vietnamese-language offshoot of the San Jose Mercury News, has mom-and-pop publishers like Nguyen concerned that the new competitor, with its bigger staff and backing of its rich corporate parent, Knight Ridder, will run them out of town.
"There's no doubt that the Viet Mercury has stronger financial backing," says Nguyen, whose 14-year-old Daily News, with a daily distribution of 8,000 to 12,000, is the area's oldest and most established Vietnamese-language daily. "It's a little bit too premature to say anything about what the impact of the Viet Mercury is on the Vietnamese market. My strategy is, I will just wait to see what happens."
Nguyen says he hasn't lost any advertising to the Viet Mercury, which is running around 112 pages since its Jan. 29 launch, while his Daily News runs around 60 pages. But other publishers say they have lost advertisers, some accusing the Viet Mercury of competing unfairly by offering a low introductory ad rate.
Mercury News publisher Jay Harris says the introductory rate ended after less than two weeks because the response from advertisers was better than expected, although some contracts were signed at that rate for longer periods. Anyway, he says, the Viet Mercury's regular rates are higher than those of most of the locally owned competition.
The Mercury News isn't the first mainstream paper to go ethnic. Some companies partner with existing ethnic papers ? the Los Angeles Times' parent company, Times Mirror, bought into La Opini?n in 1990 and earlier this year started a joint distribution with a Vietnamese-language paper in Orange County. Knight Ridder, meanwhile, has started its own. Miami's El Nuevo Herald began publishing as El Herald in 1977. In San Jose, El Nuevo Mundo, a free Spanish-language weekly, is in its third year with a distribution of about 60,000. The recognition that there's money to be made in the ethnic press isn't new. In 1892, one of Knight Ridder's founders, Herman Ridder, bought the German-language Staats-Zeitung in New York.
"The trend I see now is, mainstream newspapers are not making the revenue they want to make, so they're becoming more diversified," says Franklin Andrade, whose free La Oferta Review competes with El Nuevo Mundo.
Some observers criticize the Mercury News' modus operandi, saying its own ethnic editions threaten to put the squeeze on independent ethnic papers.
"They're in the position to intercept the Hispanic ad dollar more effectively than we can," complained Hilbert Morales, publisher of the bilingual El Observador, a 20-year-old free weekly. He says the Mercury News would have been smarter to partner with an established paper like his own that already knows the communinity. "I could have saved Knight Ridder a ton of money."
Harris says the Mercury News' duty is to serve the whole community, and it can't do that with the mother paper. "I would say they are areas for very great potential growth," he says. "These are communities that are large and growing rapidly."
He says the Viet Mercury continues the Mercury's tradition of covering the Vietnamese community ? it was the first U.S. newspaper to open a bureau in post-war Vietnam, which remains open today.
In the case of El Nuevo Mundo, a couple of rival papers have folded since its launch about three years ago, although observers say those papers were weak anyway. As for the remaining few, Harris says: "One can even argue they've gotten better. I think the competition is healthy."
As for the Viet Mercury, editor De Tran says the paper is flourishing because it reports objectively where the other media are fiercely ideological, and is hurt by jabs that he is selling out his fellow Vietnamese. As an engineering student, he decided to go into journalism because he wanted to give his people a voice.
"It's ironic that the same people who say I represent the community in the mainstream media now say I'm working against them," Tran says.
Publishers of some of the locally owned papers have met a few times to discuss ways to survive the Viet Mercury. Sandy Close, director of New California Media, a network of 75 ethnic news outlets statewide, says there is talk among the papers of merging or offering group advertising buys, as some of the Spanish-language papers did after El Nuevo Mundo hit the streets. Whether there are enough advertising dollars to go around and whether the papers can work together, despite their political differences, are unanswered questions.
Harris says the Viet Mercury does bring in white advertisers who didn't traditionally advertise in the Vietnamese community, but some observers doubt the market can support all the players. The Viet Mercury distributes 23,000 to 25,000 copies per week in more than 500 locations around Santa Clara County, and they are waiting to see whether local advertisers choose loyalty to the independent papers over exposure.
Nam Pham, who started the weekly Jiahinh, or "family," four months ago, says with hardly any capital and a staff of five to the Viet Mercury's 15, "I don't know how I can compete with them." He says he lost some advertisers to the Viet Mercury but hopes to improve his paper and keep his readers' loyalty.
Emil Gullermo, who produces a New California Media weekly television show that recently discussed the changing Vietnamese media field, is a little less optimistic. "I think in this situation the deepest pockets will win out, unfortunately ? unless the smaller papers band together," he says. "If they're all going after the same advertising, then I think you're going to see some papers going out of business."
For his part, Tran predicts the Viet Mercury will cause rival papers to improve. "Newspapers go out of business whether we're here or not. The readers will benefit because they'll get the best product out of this."

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