Making Sure the Future Looks Like Today

 

Around a week ago, the former interim CEO of SPH Media Trust, Mr. Patrick Daniel delivered a lecture on Stewardship Of The Singapore Media: Staying The Course, at the Institute of Policy Studies' (IPS). In his lecture, the veteran of the Singapore media scene outlined what he believed needed to be done in order for SPH Media Trust to become financially independent by 2045. The full report on what Mr. Daniel said can be found at:

https://www.straitstimes.com/singapore/former-interim-ceo-patrick-daniel-sets-out-what-sph-media-trust-must-do-to-be-successful

 

 Mr. Daniel touched on many important points. He rightfully argued that the newsrooms needed to look at new technologies like Artificial Intelligence and Data to drive innovation. He correctly pointed out that the news needed to be delivered on digital platforms and newspapers would have to become e-newspapers. His lecture was “sensible” in the most Singaporean of ways.

Whilst his lecture may have sounded sensible, one couldn’t help but feel sorry for Mr. Daniel for being placed in that most unfortunate of situations. It was as if he had finally been allowed to say what everyone else knew to be true – which is the fact that Mr. Daniel and the industry he was a part of had been operating in a time-warp that kept him in the 1960s and he would only be able to operate as people do in the 2020s in 2045. Take the statement that content would be delivered by digital formats and print newspapers would become e-newspapers by 2045 as an example. He was saying, that he would deliver content in 2045 the way people are currently receiving content.

How did Mr. Daniel end up in this very sad position? The answer is simple – the organisation he once worked for was so obsessed with defending its turf that it failed to realise that its turf was no longer relevant. The bosses at SPH celebrated when they took a 40 percent stake in the Today Newspaper because it ensured they would still have a dominant share of every eyeball (and let’s not forget advertising dollar) on every newspaper printed. What the management at SPH failed to notice was that eyeballs were shifting elsewhere along with the advertising dollars.

The fact that SPH was a big organisation in a small pond should not be an excuse for the failure to pay attention to shifting trends, especially when you consider the fact that far organisations like Shell Oil for example, have been actively preparing for a world where their current business may no longer be relevant.

 

 How has been such that a company like Shell has been able to anticipate the future while SPH was not able to. The answer is simple – Shell operates like a normal business. It faces some form of competition from the likes of say Exxon Mobile or Total. Competition means that the management of Shell Oil needs to look at the needs of everyone driving into a Shell Station and to anticipate how they’ll be spending money in the future. Shell Oil has to pretend to respond to environmental pressure groups. For Shell Oil, electronic cars may be a “fad” today but they’re likely to be the norm in the future.

By contrast, SPH and its sibling, MediaCorp have never really operated like normal businesses. The needs of the consumer never mattered because the consumer had no choice. Singapore’s all-powerful government has consistently reminded journalist that they operate a “special” type of business, where profit takes a secondary role to a social mission (which one might cynical enough to conclude that this mission was to remind the people that they needed the big and powerful).

Just look at the way the media business has been restructured. It has gone from being a “for-profit” business to a “non-profit.” Say what you like about the “profit-motive” and “shareholder” demands but for-profit companies are forced to respond to consumers. History has shown that for-profit companies that don’t innovate end up as a footnote in the history books. Think of Nokia, which defined the mobile phone business in the 90s. It made solid phones (only charge the battery every three days) but failed to observe and anticipate consumer behaviour and didn’t give the consumer what they wanted. Nokia’s phone business was sold at a fraction of what it was once worth.

A for-profit media business would not be waiting until 2045 to deliver what the consumer wants in a way that the consumer wants. A non-profit by contrast accounts to donors rather than consumers. SPH is where it is today because it failed as a business. It is now SPH Media Trust and therefor has no need to do anything that the consumer wants as long as donor(s) are willing to fund it.

The history of shielding people and institutions from market forces is pretty miserable. In car terms, one only has to look at the Lada and the Trabant, which vanished the moment they had to face competition from the likes of Volkswagen and Toyota. The Singapore government needs to understand this if it wants to a viably local media. Better to anticipate change and prepare for it than to be blown away by it.