PUSHED by the force of technology and changing reader habits, Singapore's media scene is entering a historical phase that may have a long-term impact on politics.
After a decade's stagnation, the Straits Times has made a crucial decision to sell itself online at up to 53% cheaper than the print version.
From March 15, Singapore's only national newspaper will offer buyers two options: its current subscription price of 70 cents or an online version for S$72 annually (40 cents a day).
For the 160-year-old newspaper, this concession finally to new technology carries both risks and opportunities.
More importantly is the potential impact on Singapore's future and the government's firm control on the media.
The announcement has been greeted with widespread anger among readers who see it as an additional cost of living rather than a new purchase option. Until now, Straits Times online is free.
The broadsheet, with no market competition, sells 390,000 copies a day. For an English-educated, affluent population of 4.2 million, it's a poor penetration rate.
(The nearest "rival" is daily tabloid TODAY that is distributed free at MRT stations.)
The move is seen as defensive rather than a great business initiative. Worldwide, few digital newspapers charge their readers, the noticeable exceptions being Wall Street Journal and South China Morning Post.
Some have tried and found it not a viable concept.
Like some newspapers in the West, the Straits Times has been losing young readers to the Internet, TV news and other distractions. In recent years, sales actually declined.
Compared to a decade ago, circulation had increased by a paltry 6.5% although the population has risen by a million.
Last year, the cover price was raised from 60 to 80 cents (subscription: 70 cents) a copy. If its website were to remain free, there could be a bigger print-to-web migration.
However, given the angry reaction, there will be few online takers initially, which means that things will remain pretty much as they are.
A few surfers may be driven back to buying the newspaper while others could move the opposite direction to save on costs.
In a few years, the story could change significantly. The print will survive, but the future may belong to online.
It is cheaper and more convenient, with an archive of seven days and news transferable at the touch of a button. It also updates news 24 hours a day – something that print buyers can't get.
Web advantages
As a digital business, the online version has two advantages over print.
Firstly, it saves on production costs. The Web product needs no newsprint and related production cost, which is higher than the 70 cents charged. (Production cost is subsidised by advertising.)
Secondly, online sales can spread overseas unregulated and immediately. Despite its long history, the Straits Times has remained largely a local product with neither the need nor experience to compete with other newspapers. Moving into cyberspace will provide the motivation to do so.
But the biggest potential may lie with AsiaOne.com, the main portal that carries the websites of the major Singapore Press Holdings papers, including the Straits Times.
The Chinese language Lianhe Zaobao will undoubtedly follow the ST action eventually and try to move into the China media market.
AsiaOne.com has over 60 million page views a month. The vast majority of viewers are from mainland Chinese seeking alternative news sources.
If Lienhe Zaobao begins charging, this number will drop but even if 5% stays, it would be a windfall.
Possible pitfall
There are also risks. The ST's large profits are derived from advertisements. If the newspaper circulation drops substantially, it will have a severe impact on advertising revenue.
Rates are based on a circulation base of 390,000. The free website has a registry of 280,000 now.
The crucial question facing its future is: How many readers can the website attract, especially foreigners, given its strong domestic national role? Can it draw enough readers to make up the decline in advertising revenue?
If the newspaper circulation declines substantially, it will likely cause an exodus of advertisers or a sharp decline in rates. While ST enjoys virtual monopoly editorially, the protection does not extend to advertising.
It is facing rising competition from other sources, including television, radio, magazines, cinemas and, of course, the Internet, all of which many benefit at its expense.
As the number of online viewers increases, so will Web advertising, but there is a ceiling above which it cannot breach, unlike the physical product.
One can't run digital supplements nor carry Web classifieds the way the paper now does.
In a recent media seminar, US publishers had some good news; demand for their Internet advertising was rising. The bad? They simply did not have enough page space to accommodate it.
At best, the ST is entering an uncertain age.
The changes may also affect the lives of Singaporeans. They may see a new world of borderless newspapers which bow to few rules or to tough censorship.
The ST online could speed up the process. Once it begins to charge overseas readers, foreign-based Web newspapers will be able to sell here, too.
Singapore is in a free-trade-agreement mood that must eventually spill into an Internet media – one that is free of government licensing.
Over time, it may even end Singapore's monopoly market. The government explains that the media monopoly is due to its perception that the market is too small for more than one player.
There will, however, be seepage. The new paying regime will bring out more chat-sites, private e-lists or weblogs to provide more news alerts and copy-and-paste services.
The government here will be watching the changes with anxiety.
Sources and Relevant Links:
Star, Malaysia Newspapers enter an uncertain age March 6, 2005
Seah Chiang Nee Insight Down South
