Singapore media spin-off into non-profit entity sparks questions over future of journalism
- SPH said the new ownership structure of its media business would be similar to the likes of Britain’s The Guardian and allow it to seek funding from public and private sources
- Questions of editorial independence from advertisers appeared to ruffle the feathers of the SPH CEO, who said the firm did not ‘pander’ to their needs
The publisher of Singapore newspaper The Straits Times billed a plan on Thursday to spin off its media business into a non-profit entity as a boon for local journalism, but observers are pessimistic that the move – the biggest restructuring of the industry in decades – will alter the country’s anaemic state of press freedom.
Singapore Press Holdings (SPH), one of Asia’s biggest media groups, said its new ownership structure would be similar to the likes of Britain’s The Guardian and The Tampa Bay Times in the US – both of which are owned by non-profit entities.
Local observers noted that organisations such as The Guardian – owned by the Scott Trust Limited – were able to preserve editorial independence through firewalls erected between funders and newsrooms.
Queried on whether the plan would lead the group’s newspapers to become beholden to funders such as advertisers, SPH’s chief executive Ng Yat Chung lashed out in anger, saying media groups across the country also accepted funding from various sources.
The question was posed to him by a reporter from Mediacorp, the national broadcaster fully owned by state investor Temasek Holdings.
Nonetheless, a Guardian-style firewall is unlikely in Singapore, observers said, given the long-ruling People’s Action Party’s (PAP)’s adamance that the media has to be subordinate to elected officials. The government meanwhile has said it is ready to directly fund the new entity, giving credence to fear that the changes may further erode the editorial independence of SPH newspapers, observers said.
SPH has for decades enjoyed a near-monopoly in newspaper publication because of strict licensing rules. While it is publicly listed, state-linked entities hold management shares that are crucial to determining editorial appointments.
The firm’s chairman is traditionally someone who has deep links with the PAP.
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The company, which owns properties such as shopping malls, has in recent years been mired by a decline in the media business precipitated by the global trend of falling advertising revenues for print newspapers.
Last year, SPH swung to its first full-year loss on record – based on data compiled by Bloomberg – after consecutive years of shrinking net income.
The company’s share price has fallen steeply over the last five years, and at one point last year traded below S$1.00 – almost a quarter of its price in 2016.
Announcing the restructuring plan following a trading halt on Thursday morning, SPH said in a statement that the proposed new structure would allow the media business to seek funding from public and private sources.
The government in a separate statement said it backed the proposal, and was ready to offer the new entity funding support “to help it build capabilities for the future”. The matter will be discussed in parliament next week.
Speaking in a press conference, company chairman Lee Boon Yang said with losses likely to continue in the media business, “remaining part of a publicly-listed company, where it is subject to expectations from shareholders of profitability and regular dividends, is no longer a sustainable business model”.
“Hence, a not-for-profit structure that allows SPH Media to seek funding from a range of public and private sources with a shared interest in supporting quality journalism and credible information is the optimal solution,” The Straits Times quoted him as saying.
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The spin-off company, SPH Media Holdings Pte Ltd, will be provided with at least S$110 million of initial funding and resources.
Lee, a former minister, said the Ministry of Communication and Information had indicated its support for the restructuring, which will be completed three to six months after an extraordinary general meeting is held in July or August.
Lee also fielded questions about editorial independence, saying SPH outlets would continue to practise responsible and objective journalism.
The issue however appeared to ruffle the feathers of Ng, SPH’s chief executive.
TodayOnline, a news portal owned by Mediacorp, quoted the former army general as questioning whether reporters who posed the question saw themselves as bowing to the needs of advertisers when their respective outlets “receive substantial funding from various sources”.
“The fact that you dare to question SPH titles for, in your words conceding [to advertisers‘ interests], I take umbrage … I don’t believe even where you come from … you do not concede to the needs of advertisers,” he said.
“I must call this out … Chairman [Lee] is a gentleman. I’m not,” he added.
The government sees the media as part of the larger effort towards nation-building
The changes are the biggest in the newspaper industry since 1984, when SPH was formed following the merger of three different media groups.
PN Balji, a former chief editor of The New Paper – a once hugely popular English tabloid under the SPH stable – said he did not believe the restructuring would herald any change in press freedom in Singapore. Balji said his analysis was that the PAP “cannot and will not” give up its control over SPH’s news outlets.
“I don’t see it happening unless the top echelons of government sees a need to free up the media. I don’t see that happening in the present leadership and even in the 4G,” Balji said, referring to the fourth generation of PAP leaders who are slated to succeed Prime Minister Lee Hsien Loong and his contemporaries.
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Ang Peng Hwa, a professor of communication studies at the Nanyang Technological University, said the key question surrounding the restructuring was the “extent of government control of this new entity”.
“The government sees the media as part of the larger effort towards nation-building,” he said. “[Singapore has] never subscribed to the press as the fourth estate.”
The professor suggested any official funding to SPH could take place through a third-party trust, with the external body led by eminent figures such as former judges and politicians.
“Some countries that have adopted such models rank higher on press freedom indices than even the US,” Ang said.
Other academics acknowledged the merits of such an arrangement, but said they were pessimistic that SPH Media would follow such a model.
“In Singapore, only the state has the deep pockets to support large newspaper companies,” the Hong Kong-based Singaporean media academic Cherian George wrote in a Facebook post following Thursday’s announcement. “And the Singapore state has shown no appreciation for the principle of arms-length funding in the past.”
With the restructuring exercise raising the prospect of “de facto nationalisation of Singapore’s private media”, citizens must be given a say on the matter through a public consultation exercise, he said.
A Singapore-based observer who declined to be named meanwhile said he viewed the restructuring as inconsequential.
“It’s a fact that the media in Singapore serves to amplify official positions and play down critical perspectives … no amount of money can change that,” the academic said.
