Taking Umbrage at the Writing on the Wall

The real estate business was always going to be more profitable than the media business. But people have already taken umbrage to this notion years ago by calling SPH “Singapore Property Holdings”.

Real estate folks have a penchant of calling SPH “Singapore Property Holdings”. Source: https://www.ein55.com/category/property-market/

In this Linkedin article in 2019, Derrick opined that a break-up between the underperforming core media business and profitable property business inevitable. His crystal ball proved ominent.

Systemic Issues

It is an understatement to claim that the print media industry has taken a sharp decline over the years. I remembered the old days in school where schools would order hard copies of Readers’ Digest, The Economist and TIME for its students to level their worldly knowledge. Today, the Internet replaces this function.

Print media was dominant pre-Internet because of the limited number of channels for information consumption. This meant that advertisers were at the mercy of print media, because print media controlled the instrumentation required to propagate advertisements. Print media profits were hence largely derived from print advertisements in the past.

Some of these “old media fundamentals” are uprooted today. Who views the Classifieds section for job advertisements today? In my generation, almost nobody, because there are other sources we can seek for both content and advertisements.


Before we put the blame solely on “advertising”, let us encapsulate the discussion with a Quora thread.

The “ad-blocking” trend first surfaced in response to the digital companies placing advertisements on their platforms in multiple ways. Clearly, consumers were not pleased with these ads, resulting in workarounds such as the use of Ad-Aware (in the early days) to detect “adware” and delete these add-ons.

In the old days, browser helper objects (BHOs) such as toolbars were frequently bundled with digital products such as free game executables. Source: https://www.f-secure.com/sw-desc/adware_w32_bho.shtml

With the rise of Web content consumption, advertisements also moved from bundling products and ads in installers to Javascript snippets such as Google advertisements. For as long as there exists web content that is “given for free”, there must be some method of monetisation somewhere else.

Ads have been the answer to this, and will always be a monetisation strategy. While annoying to the majority, a minority will click, and a proportion of the minority would result in additional sales to the firm advertised, reinforcing the need to run advertising.

Financing versus Editorial Independence

But are advertisements alone enough? That depends on the type of content, which also means the following: content needs to be digestible by a large enough audience for advertising strategies to work because of scale. This is not always the case, which raises the question on who backs the media outfit and whether said media outfit will maintain an editorial direction independent to the sources of funding. This is not always clear cut.

In the United States, the media scene is known to be politically driven as a consequence of the technical definition of media as the “fourth estate”. It is clear that the editorial direction of many media outfits (caution: not all) will be affected because the “fourth estate” definition implies the media’s freedom to craft political issues in a narrative of their choosing.

Editorial independence is not equal to non-bias. It is difficult to find “non-biased” sources. Editorial independence simply means that the editorial desk can direct the media outfit independent of the sources of their funding. E.g. if Hilliary Clinton funded a certain paper, would the editors write articles rebuking the Clinton era, yet are still able to continue being funded? In some contexts, this is tantamount to “biting the hand that feeds you” and in other contexts, this is tantamount to “speaking truth to power”. Context is everything here; we cannot answer this with confidence because financing leads directly to the viability of the publication should large decentralised funding mechanisms (e.g. advertising, subscriptions) not work to be sufficient to run the media outfit as a commercially viable entity.

Taking Umbrage at the Writing on the Wall for SPH

The writing on the wall for SPH was in fact much earlier.

In this Guardian opinion piece, Victor opines that the commercial method of running a media outfit was no longer viable due to the irreversible loss of the monopoly position media companies used to have to run advertisements.

SPH tried to keep the media business going as a commercial venture by spinning off other revenue streams like property. But property does not address these issues SPH faces.

a) The property arm of SPH slowly became the profit nexus of SPH, eclipsing the primary business.

b) Yet in property, its growth would be stymied by the real estate companies in Singapore such as Capitaland.

c) SPH runs the Straits Times, which has a national narrative.

Basically, the fundamentals of SPH conflicted with the balance sheets of SPH (you can see the declining print revenue for SPH in the Linkedin screenshot). COVID-19 simply laid bare SPH’s untenable position (by extension, The Straits Times (ST)) in the long run because it failed at capturing market share in the digital space as compared to Channel NewsAsia and TODAY (I think Channel NewsAsia has the best digital offerings.)

Straits Times’s webpage: Simply the physical newspaper brought to digital format.
Channel NewsAsia: More product offerings like podcasts, TV and documentary series (e.g. Climate Change)
Today: Tried to appeal to a younger group through Gen Y speaks (although the quality of content is not always stellar)

It is quite clear ST’s answer to digitalisation was inadequate; all they did was to switch from physical broadsheet to digital broadsheet, offer subscriptions and provide tablets to read ST. From a business standpoint, that is not digitalisation, and from a consumer consumption perspective, this was woefully inadequate. Our parents read the broadsheets from front to back because there was a dearth of information sources in the past. Copying the broadsheet and pasting it in an app, expecting people to consume news that way was a recipe for disaster.

The Missing Voice: SPH Journalists

Curiously, in an issue involving a journalism outfit, SPH journalists did not voice much opinion. It was TODAY’s coverage on Instagram that attracted more eyeballs from my friends.

Honestly I take umbrage at your first question. (Ng Y.C., 2021)

The missing voice of SPH’s journalists is deafening. Some questions that I think are missing:

  1. What do they think of this move, especially considering that SPH still has the largest newsdesk in Singapore by far? Surely a restructuring proposal to decouple property from press, and to use the company limited by guarantee (CLG) to raise private and public equity be something that concerns them.
  2. Is it a journalistic quality issue? Many people (me included) find ST’s reporting less than stellar at times. Do they think that is the reason that stymies a move to a subscription-based model?
  3. Why did ST not try to evolve from simply a broadsheet? Even the Government today speaks to other media companies like SGAG and Mothership to create content in different forms for different target audiences. What was ST doing in the years of digitalisation and why did it fail?

Could SPH Have Been Saved?

To answer this question, we must first define “saved”. For instance, in Calvin Cheng’s commentary, he cleverly avoids the question on the form SPH could have taken, although he correctly points out that the SPH ship was sunk by digitalisation.

But perhaps we should take a look at “saved” in the SPH context. To answer this question, we first have to ask ourselves what entity we expect to see the press component of SPH to be, and why.

First question: should it be a for-profit entity, and if “yes”, how it is expected to be profitable. The bad news? Domestic news is not profitable, especially with this space overcrowded with all sorts of news outlets such as TNP, Mothership and our socio-political commentators. The money from a domestic audience of five million people alone is unlikely to result in a profitable news desk.

Another angle is to compete with top journalism outfits like BBC, DW (Europe); Asahi Shimbun, South China Morning Post (Asia); USA Today and Bloomberg (USA) as an illustration. Ranking of Asian newspapers suggest that ST is still far from the largest papers today. Will this model to pivot to the international desk work? Channel NewsAsia is trying from an Asia-centric perspective, but I am unsure if SPH will attempt this angle.

Ranking of top Asian newspapers. The ranking is not that “bad” per se, but to compete against the biggest in news, it is clear we need to up our game.

But SPH also has a national objective. Once we switch paradigm to think about news from the perspective of “national communication”, the question becomes stark, because SPH needs to keep its local news desk. How amenable would Singapore be to the local news desk being run by entities with either no interest in Singapore affairs, or have interests in Singapore affairs contrary to the interests of Singapore? The answer is likely “no”, and this issue opens another can of worms about issues such as the Newspaper Printing and Presses Act (NPPA). However, I shall not try to tackle the NPPA issue in this post. In other words, SPH cannot simply sell off its press arm to the entity that can likely run ST profitably regardless of national interest; the government will likely block this move for good reason, and it was probably for this reason that the government supported SPH’s proposal to form a CLG instead, promising to provide funding for it.

Some will also contend that the political climate in Singapore makes running a competitive domestic news room untenable due to the historical backdrop of media in Singapore. This is also easier said than done (and arguably beyond scope for humble me since I do not work at SPH), as it likely requires a cultural overhaul of the news room. In today’s form, who would fund a domestic news desk, ensure high journalistic integrity and understand how to navigate Singapore’s political dynamics among government, news room and citizens? I hold my breath on this.

Some may also suggest nationalisation, but unlike in the case of SMRT’s delisting, nationalising the press would only serve to reinforce the perception of SPH being the “government’s mouthpiece”. It takes a government utterly daft to political trends to nationalise the press no matter what the economic grounds may be.

The conundrum is this: we expect a press to have high journalistic integrity, be at an arm’s length away from its funding sources or the Government, yet it must offer a national perspective so that Singaporeans will have local news to read, interpret and understand. Who would be eligible to fund such an endeavour and actually did it, if it turns out that it cannot be profitable?

This is not for the lack of trying; Bertha Henson tried to run The Middle Ground, but operating a newsroom of such size (a fraction of SPH) ran in the tens of thousands. The fact that the TODAY article centred financial viability around ad revenue and the lack of Patreon donors suggest that domestic news by itself simply is not profitable.

When we ask the question on whether SPH can be saved, it is perhaps important to ask ourselves what we value about local news, and how much we will be paying for (be it in the form of a licensing fee, tax, direct payment to publisher). And if the costs do not sum up, we will probably live with its consequences: a dearth of news publications, and a news landscape that does not capture the Singapore perspective as vividly.

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