Singapore Press Holdings (SPH)

[Drizzt]

I think you will be surprised that there are people who buy Strait Times not for the news - but the classified and supermarket advertisement. Not too long back, NTUC used to have coupons printed for their weekly special. They dun do that now but I'm sure in the past people buy ST just for the coupons.

Of cos, I think this group of people is probably not significantly large. So ultimately the impact won't be significant.

In the case of ST, its a little curious but I suspect that becos its been a part of so many people life, and intimately ingrained, it would be difficult to give it up - especially for the older folks. The younger chaps will pay for news as shown in the continued good circulation of New Paper. So I dun think it the case of paying for responsible journalism content. And of cos when you talk about ST, you cannot avoid the topic of its pro-govt stance (correctly or otherwise not important). So question is: How many people on the other side of the fence has given up on ST because of this reason?

Personally, ST is a good to have but not a must have. Given a choice, I can give up ST and just relied on the free sheets like Today and MyPaper for the essential news items.

SPH owns My Paper and part of Today and as such, also earn revenue from advertisements in these two free tabloids. Therefore, you have just reinforced the fact that newspaper would not disappear in the interim.

lets drill down abit and i believe majority of the revenue comes from the main papers not My PAper and today?

Do you guys look at SPH and think that:"i have many channels, papers, online, street display, i can sell you a multi channel package"

for business is that the moat and how they maintain their CORE revenue?

[yeokiwi]

In 2000, the Straits Times daily average circulation is around 390,363.
In 2012, the daily circulation is 389,700.

What is the difference between 2000 and 2012?
The population in 2000 and 2012 is 4 million and 5.2 million respectively.

So despite an increase of more than 25% in population, the average circulation now is less than 2000.

SPH is generally regarded to be pro-gov and therefore, it has difficulty acquiring overseas media companies for expansion.
Singtel, Capitaland and Keppel do not have this limitation.
Any expansion of SPH business must be in non-media related fields.

Mediacorp faces the same problem but it is not listed.

[momoeagle]

Drizzt, I think you misunderstood me. SPH is not considered as multi channel in the world of marketing. At best, it offers a few different channels in the following
1) newspaper
2) website news
3) apps
4) malls
5) magazines

Apart from malls, which is now spun off to SPH REIT, the others are in mainstream printed media, and not really multi channels.

In the world of marketing, multi channels include Adsense, Facebook, yahoo, television, radio, flyers, advertising magazines, bus ads, taxi ads, mrt ads, and many more. It's all about reaching potential customers, and different channels have their own unique uses and purposes. It is important to reach out to potential customers through as many channels as possible. That is one aspect of marketing and branding, to keep the business constantly in your mind. New advertising mediums give big advertisers more choices, channels and avenues to spend their money on. And it is the creative use of these mediums that will bring about the success of a marketing campaign.

Also, if you notice, supermarkets are still advertising heavily in SPH printed media. Why? Because the majority of their customers (like my parents) are not as versed with the Internet as our generation, and these big group of customers will still be around for many years to come. It is the relevancy of the marketing channel, and not so much on its alternatives that may not even reach out to its target market. There's absolutely no point to make use of a new marketing medium or channel (like Adsense) if the main customers aren't even looking at it.

In other words, the pertinent question as to whether SPH will continue to earn advertising dollars lie in whether it remains relevant as a marketing channel for advertisers. Technology may seem all new and exciting but we do need to consider its take up rate and efficiency for different forms of businesses.

---

In 2000, the Straits Times daily average circulation is around 390,363.
In 2012, the daily circulation is 389,700.

What is the difference between 2000 and 2012?
The population in 2000 and 2012 is 4 million and 5.2 million respectively.

So despite an increase of more than 25% in population, the average circulation now is less than 2000.

SPH is generally regarded to be pro-gov and therefore, it has difficulty acquiring overseas media companies for expansion.
Singtel, Capitaland and Keppel do not have this limitation.
Any expansion of SPH business must be in non-media related fields.

Mediacorp faces the same problem but it is not listed.

question is, from 2000 to now, where did the majority of the population increase come from?

I would say mostly due to immigration. Then the next thought would be, are most of these new immigrants interested in local news?

[Greenrookie]

In 2000, the Straits Times daily average circulation is around 390,363.
In 2012, the daily circulation is 389,700.

What is the difference between 2000 and 2012?
The population in 2000 and 2012 is 4 million and 5.2 million respectively.

So despite an increase of more than 25% in population, the average circulation now is less than 2000.

SPH is generally regarded to be pro-gov and therefore, it has difficulty acquiring overseas media companies for expansion.
Singtel, Capitaland and Keppel do not have this limitation.
Any expansion of SPH business must be in non-media related fields.

Mediacorp faces the same problem but it is not listed.

The 2012 circulation figures include digital subscription, and given they give digital access to those who subscript to the ST, there may be some overlapping. Print subscription is about 355K IIRC.

I think the core question is, are there true alternatives to advertising through the SPH papers, to get to the masses at a lower costs. The issue is not so much of circulation but of advertisement fees. If you noticed, the "display" advertisements from the Telcos, NTUC, etc are often found in ST, lianhezaobao, and "TODAY"(Not from SPH), I am not sure which digital platform has such reach compared to papers taken as a whole together.

But if you talk about "classified" and "recruits", I think these 2 segments are especially at risk. If I want to buy a property, I willl look at the various websites first, before I check my papers.

The numbers bear this out too:
During the weak 2008 Q4 to 2009 Q1 to Q4, classified and recruits suffered the biggest drop as compared to display, when the weak recovery starts in 2010, total advertisement rev is smaller than 2012 and 2013 YTD, but classified's revenue is higher in 2010 than in 2012 and 2013 YTD.

The bleeding is at the "classified" and "recruits", and hence, this explained why SPH is buying SGcarmart, and the likes...(They are finally getting it)

But seriously, while I think the bleeding is going to be slow... (classified share of rev is now only 25%), I doubt it can be reversed. Unless they are able to also buy ebay and the likes hahaha

SO to slow the bleed, they need to start buying some platforms of leadership position (sg carmart is a good example), maybe property guru? Hardwarezone is it under SPH? But how many online platforms can have the reach like sgcarmart, they want to buy, also have no proper targets, such is their pain...

[Drizzt]

Drizzt, I think you misunderstood me. SPH is not considered as multi channel in the world of marketing. At best, it offers a few different channels in the following
1) newspaper
2) website news
3) apps
4) malls
5) magazines

Apart from malls, which is now spun off to SPH REIT, the others are in mainstream printed media, and not really multi channels.

In the world of marketing, multi channels include Adsense, Facebook, yahoo, television, radio, flyers, advertising magazines, bus ads, taxi ads, mrt ads, and many more. It's all about reaching potential customers, and different channels have their own unique uses and purposes. It is important to reach out to potential customers through as many channels as possible. That is one aspect of marketing and branding, to keep the business constantly in your mind. New advertising mediums give big advertisers more choices, channels and avenues to spend their money on. And it is the creative use of these mediums that will bring about the success of a marketing campaign.

Also, if you notice, supermarkets are still advertising heavily in SPH printed media. Why? Because the majority of their customers (like my parents) are not as versed with the Internet as our generation, and these big group of customers will still be around for many years to come. It is the relevancy of the marketing channel, and not so much on its alternatives that may not even reach out to its target market. There's absolutely no point to make use of a new marketing medium or channel (like Adsense) if the main customers aren't even looking at it.

In other words, the pertinent question as to whether SPH will continue to earn advertising dollars lie in whether it remains relevant as a marketing channel for advertisers. Technology may seem all new and exciting but we do need to consider its take up rate and efficiency for different forms of businesses.

---

In 2000, the Straits Times daily average circulation is around 390,363.
In 2012, the daily circulation is 389,700.

What is the difference between 2000 and 2012?
The population in 2000 and 2012 is 4 million and 5.2 million respectively.

So despite an increase of more than 25% in population, the average circulation now is less than 2000.

SPH is generally regarded to be pro-gov and therefore, it has difficulty acquiring overseas media companies for expansion.
Singtel, Capitaland and Keppel do not have this limitation.
Any expansion of SPH business must be in non-media related fields.

Mediacorp faces the same problem but it is not listed.

question is, from 2000 to now, where did the majority of the population increase come from?

I would say mostly due to immigration. Then the next thought would be, are most of these new immigrants interested in local news?

in order words, lets see the segmental reporting whether this MOAT is there at all.

if they are still advertising and business is as usual, why would advertising be going down?

[countonme]

As you may already know, there are many promotions to subscribe STimes and get many freebies. The aim is likely to keep people subscribe to it even if they "heavily subsisidsed". I personally dont find much content on weekdays ST. This is more of to attract people to buy and read the articles like wat gov new policies and messages etc.

I do agree more people r skipping the newspapers even w the 24% increase in population.

In 2000, the Straits Times daily average circulation is around 390,363.
In 2012, the daily circulation is 389,700.

What is the difference between 2000 and 2012?
The population in 2000 and 2012 is 4 million and 5.2 million respectively.

So despite an increase of more than 25% in population, the average circulation now is less than 2000.

SPH is generally regarded to be pro-gov and therefore, it has difficulty acquiring overseas media companies for expansion.
Singtel, Capitaland and Keppel do not have this limitation.
Any expansion of SPH business must be in non-media related fields.

Mediacorp faces the same problem but it is not listed.

[momoeagle]

in order words, lets see the segmental reporting whether this MOAT is there at all.

if they are still advertising and business is as usual, why would advertising be going down?

In small and medium businesses, marketing is necessary, and typically form between 10% to 20% of business revenue. As Greenrookie has already pointed out earlier, advertising revenue seems correlated to the GDP growth, which makes sense in the business world.

The data itself is a tricky thing.
Using Greenrookie's data, from 2000 to 2012, the average over the 13 years is about 927 393 from his data, and the standard deviation of the ad revenues is about 79950.

Certainly, such calculations does not give predictions of future revenues, nor am I proficient in using statistics for analysis. But if we compare to the mean value of the past 13 years revenue, SPH's ad revenue for 2010, 2011, and 2012 are higher than its 13 year mean.

Furthermore, if we compare ad revenues year on year,
2000 to 2001: decrease
2001 to 2002: decrease
2002 to 2003: decrease
2003 to 2004: increase
2004 to 2005: increase
2005 to 2006: increase
2006 to 2007: increase
2007 to 2008: increase
2008 to 2009: decrease
2009 to 2010: increase
2010 to 2011: increase
2011 to 2012: decrease

There doesn't seem to be a consistent trend of decreasing revenues.

As such, how could we claim that SPH's ad revenue is going down, if variatons are to be expected. At best, I would say SPH's ad revenue are pretty consistent around its mean, base on statistical data.

[Drizzt]

in order words, lets see the segmental reporting whether this MOAT is there at all.

if they are still advertising and business is as usual, why would advertising be going down?

In small and medium businesses, marketing is necessary, and typically form between 10% to 20% of business revenue. As Greenrookie has already pointed out earlier, advertising revenue seems correlated to the GDP growth, which makes sense in the business world.

The data itself is a tricky thing.
Using Greenrookie's data, from 2000 to 2012, the average over the 13 years is about 927 393 from his data, and the standard deviation of the ad revenues is about 79950.

Certainly, such calculations does not give predictions of future revenues, nor am I proficient in using statistics for analysis. But if we compare to the mean value of the past 13 years revenue, SPH's ad revenue for 2010, 2011, and 2012 are higher than its 13 year mean.

Furthermore, if we compare ad revenues year on year,
2000 to 2001: decrease
2001 to 2002: decrease
2002 to 2003: decrease
2003 to 2004: increase
2004 to 2005: increase
2005 to 2006: increase
2006 to 2007: increase
2007 to 2008: increase
2008 to 2009: decrease
2009 to 2010: increase
2010 to 2011: increase
2011 to 2012: decrease

There doesn't seem to be a consistent trend of decreasing revenues.

As such, how could we claim that SPH's ad revenue is going down, if variatons are to be expected. At best, I would say SPH's ad revenue are pretty consistent around its mean, base on statistical data.

What about the segmental profit and revenue analysis off it. Would staff cost be an issue?

[yeokiwi]

SPH website has a wonderful collection of annual reports for those who are interested to analyse its results.

Eg.
Segmental information

Year 2001
Newspaper and magazine

Revenue $960,467,000
Profit Before Taxation $361,239,000

Year 2012
Newspaper and magazine

Revenue $1,002,762,000
Profit Before Taxation $335,123,000

If 4% annual inflation is factored in, the adjusted profit before tax for 2001 in 2012 is around $555 million.

The moat is always there, except that it is shrinking.

[momoeagle]

in order words, lets see the segmental reporting whether this MOAT is there at all.

if they are still advertising and business is as usual, why would advertising be going down?

In small and medium businesses, marketing is necessary, and typically form between 10% to 20% of business revenue. As Greenrookie has already pointed out earlier, advertising revenue seems correlated to the GDP growth, which makes sense in the business world.

The data itself is a tricky thing.
Using Greenrookie's data, from 2000 to 2012, the average over the 13 years is about 927 393 from his data, and the standard deviation of the ad revenues is about 79950.

Certainly, such calculations does not give predictions of future revenues, nor am I proficient in using statistics for analysis. But if we compare to the mean value of the past 13 years revenue, SPH's ad revenue for 2010, 2011, and 2012 are higher than its 13 year mean.

Furthermore, if we compare ad revenues year on year,
2000 to 2001: decrease
2001 to 2002: decrease
2002 to 2003: decrease
2003 to 2004: increase
2004 to 2005: increase
2005 to 2006: increase
2006 to 2007: increase
2007 to 2008: increase
2008 to 2009: decrease
2009 to 2010: increase
2010 to 2011: increase
2011 to 2012: decrease

There doesn't seem to be a consistent trend of decreasing revenues.

As such, how could we claim that SPH's ad revenue is going down, if variatons are to be expected. At best, I would say SPH's ad revenue are pretty consistent around its mean, base on statistical data.

What about the segmental profit and revenue analysis off it. Would staff cost be an issue?

Weren't you talking about advertising revenue decreasing?

Staff costs and profits are different from revenue.