New SPH media entity could get public and private funding; will continue to uphold editorial integrity

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SINGAPORE - The new not-for-profit entity that will run Singapore Press Holdings' (SPH) media business will be able to receive funding from a mix of public and private contributions, including additional financial support from the Government, said SPH chairman Lee Boon Yang.

Explaining how the funding model could work for the new company at a press conference on Thursday (May 6), he said that SPH will transfer all its media assets to a wholly-owned subsidiary - SPH Media.

This includes its leasehold properties such as the News Centre in Toa Payoh North and the Print Centre in Jurong, related information technology and intellectual property assets such as rights to the titles of all its publications, and stakes in four of its digital media investments - AsiaOne, DC Frontiers, Target Media and Singapore Media Exchange (SMX).

SPH will also inject $80 million in cash as well as $30 million in SPH shares and SPH Reit units into the new entity, which will eventually become a company limited by guarantee (CLG).

This injection will give the new entity a "reasonable runway to take off into its new chapter", Dr Lee said.

"We expect this injection of capital to give it time for the next three to four years maybe, depending on circumstances, to reach a safe landing in terms of a long-term sustainable funding model, which will involve public-private partnership," he added.

The new company will be able to reinvest its operating revenue into its media operations.

And as a not-for-profit organisation, it would also be able to source for additional public funds - something that cannot be done if it is part of a listed company, Dr Lee noted.

"It is also possible for the CLG to receive additional financial support from the Government to help it to achieve its mission as a public information provider for Singapore," he said. "So that would ensure that it would have a sustainable financial model for the future."

Maintaining editorial integrity

Asked how the new company would preserve its editorial independence while receiving external funding, including possibly from the Government, Dr Lee said SPH's media business has striven to serve its readers in an objective, accurate and responsible manner.

"I believe that over the 37-odd years or so, they have achieved this mission of serving the public, the news-consuming public, and earning their trust, confidence and also respect as a reliable source of news and information," he said.

These deeply embedded values will be "ported over" to the new entity, which will be charged with the mission to "preserve this level of responsible, objective and accurate journalism", he said, adding that "this is something that the CLG will pay great attention to".

"They will obviously receive public, private funding in the process, but they will not stray from the mission to maintain the credibility, trustworthiness and respect of the media by the Singapore public.

"So I'm quite confident that despite some perceptions otherwise, that SPH Media in its new home will continue to uphold the values that have brought it to this level of respect and trust by its readers or online audience."

Asked whether the new revenue model meant that "the media business will now pivot to emphasise editorial integrity, for example, ahead of advertiser interests", Dr Lee said he was confident that what has upheld editorial integrity for SPH Media over the years will continue.

"There will be no difference, that editorial integrity will take precedence. And I'm confident that under the CLG, what I call the DNA of SPH Media will still be there and it will manifest itself. And rightly so because editorial integrity will have to come ahead of pure financial consideration," he added.

He noted that the restructuring exercise comes amid market pressures and changing media consumption habits: "One could say that you could change your whole approach to our media titles and make them perhaps more acceptable to what you think will sell.

"But that would do damage to the media capabilities that we spent so much effort and resources to build up over the years," he said.

"We believe that we still have this public information provider duty to uphold, and we want to maintain the standard."

SPH chief executive Ng Yat Chung said he took umbrage at the question from CNA Digital about revenue and editorial integrity.

"There are reporters (from media outlets) here who received substantial funding from various sources, and I don't believe that you would describe yourself as bowing to the needs of advertisers in doing your job," he said.

SPH has always received advertising but it has "never, never conceded to the needs of advertisers", he said, adding that SPH Media would continue to provide fair, reliable and credible reporting.

"The fact that you dare to question the SPH title for, in your words, 'conceding to the advertisers', I take umbrage at that comment because I don't believe that even where you come from, you concede. In doing your job, you do not concede to the needs of advertisers. So I must call this out. Chairman is a gentleman; I'm not," said Mr Ng.

"The purpose of doing this is to make sure that SPH Media will continue to do the job it has done so well for so long."

Ensuring media capability not adversely affected

(From left) SPH CEO Ng Yat Chung, chairman Lee Boon Yang and CFO Chua Hwee Song speaking during a press conference on May 6, 2021. ST PHOTO: GAVIN FOO

On whether the restructuring will lead to any retrenchments or wage cuts, Dr Lee said the intention of the exercise is to ensure that "the media capability within SPH Media is in no way disadvantaged, in no way undermined by the transfer".

The new company is fully cognisant that it has to continue to nurture and strengthen the media business, "rather than undermine it, whether it's by right-sizing, retrenchments or wage adjustments".

Added Dr Lee: "We want to ensure that the newsroom preserves its capability, has the core competency and has the resources required to discharge its responsibility as a major media service provider in Singapore."

As part of its strategic review, SPH had concluded that hiving off its media business to form a not-for-profit entity was the best and most appropriate solution for all stakeholders, he said.

"This will ensure that our longstanding media titles will be able to continue serving our nation for a long time to come."

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