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Categories
| Two new Chinese papers enter fray |
| Written by Kathy Fong | |||
| Monday, 06 July 2009 00:00 | |||
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Against the backdrop of shrinking advertising expenditure (adex) as businesses slash budgets in a gloomy economy, launching a periodical will indeed raise eyebrows, particularly in the media industry. Interestingly, Talent Plus Sdn Bhd, the publisher of the Red Tomato, is not alone. In January this year, a Chinese financial magazine, The Busy Weekly, hit the streets. The emergence of two new publications within a short period stands in stark contrast to the the print media’s grim operating environment. Furthermore, the media landscape is evolving due to the Internet. More readers are migrating online to get the latest news. Several major newspapers in the US, such as the 144-year-old San Francisco Chronicle, have folded up due to declining readership and mounting debts. This has set off alarm bells for publications around the world to rethink their business model. On the local front, no one has been spared from the impact of the downturn. Some public-listed print media companies had already slipped into the red for the quarter ended March 31, 2009. Media Chinese International Ltd, which dominates the Chinese daily market, suffered a net loss of RM17.1 million for 4QFY2009 ended March 31, The New Straits Times Press (M) Bhd a net loss of RM2.9 million in the same quarter and Utusan Melayu (M) Bhd a net loss of RM7.46 million. The battle for readers among the Chinese dailies is a bruising one. It is learnt that Oriental Daily is offering the paper to its readers for RM20 a month, inclusive of delivery fees, to build up its readership. Given such a competitive operating environment, is there room for more Chinese publications? Or are the launches of new publications an indication that the Chinese media market remains lucrative and untapped? The editor-in-chief of The Busy Weekly, Ko Keak Hock, for one, believes there is ample room for the business magazine, based on his estimate of the market’s potential size. Noting that there are 3.8 million CDS (central depository system) accounts in the country, Ko assumes that 60% of the account holders are active investors, which means there are about two million traders in the share market. From the data he has gathered from the stockbroking houses, roughly 70% or 1.4 million of the CDS accounts are Chinese investors. Now, assuming that half of this figure, or 700,000, are Chinese literate, Ko sees healthy demand for business news. “Even if I assume that only 10% of these 700,000 investors are relying on the media for their main source of financial information, there are already 70,000 prospective readers for The Busy Weekly,” he explains. “Our target circulation of 20,000 copies isn’t a tall order, and we have achieved it.” The weekly’s circulation figures have not been audited since it was launched only months ago. Currently, it has about 16,000 subscribers in the major cities nationwide. “We have hit our initial target,” says Ko, who started his financial journalism career in 1990. The Red Tomato, founded by Gan Chin Kew, is targeting a totally different market. Gan, Talent Plus managing director, has positioned the Red Tomato as a niche product that offers lighthearted reading. The weekly publication is only available in Petaling Jaya and Kuala Lumpur, where there is a high density of Chinese. “I feel that there is room for free Chinese newspapers,” Gan tells The Edge. For the Red Tomato, the key is to focus on “creative marketing” to woo advertiser dollars. Gan is no stranger to the Chinese media industry, having been in the field for more than 20 years. He was on the board of Sin Chew Media Corp Bhd before he joined Nanyang Press Holdings Bhd. This was prior to the birth of Media Chinese International that saw the Chinese print media group and Ming Pao Enterprise Corp Ltd merge about two years ago. Gan says the advertising space in the inaugural edition has been fully booked and that 80% of the advertising space in the second and third editions is already sold — certainly an achievement when businesses are being cautious about their adex. Given that the Chinese are a minority in Malaysia, albeit a significant one, and the fact that not all Chinese are literate in their own language, the Chinese media market seems to be limited. The truth, however, is quite different. Statistics show that relative to circulation, the readership among the Chinese tends to be higher than in the non-Chinese segments. “One reason could be that the Chinese follow the news more closely than others, so the Chinese papers have higher readership,” says an industry observer. According to Nielsen Media Research, the print media (newspapers only) commands about 55% of total gross adex in the country. The English newspapers have 26%, Chinese 16%, Malay 12% and Tamil 1%. The readership figures, however, do not show a similar trend. The English papers have the least readers of about 1.6 million, although this segment enjoys the largest share of the adex pie. The Chinese newspapers have 2.6 million readers, while Malay papers have a gross readership of 4.7 million. Rita Sim, Media Chinese International’s executive director, believes the English newspapers command the lion’s share of the adex simply because media planners tend to plan in the English language. Also, English newspaper readers are perceived to have stronger purchasing power than those who read Chinese or Malay dailies, which Sim disagrees with. Nevertheless, she believes there is “very little room” for more Chinese magazines. “New Chinese publications may cannibalise existing adex from others. But it also depends on the effectiveness of the publication. A weak product may not attract readers or advertisers,” she says. Indeed, cannibalisation is precisely the reason that, some industry observers say, has stopped Media Chinese International, which is controlled by tycoon Tan Sri Tiong Hiew King, from launching any weekly publications like The Busy Weekly. The Busy Weekly is like a spin-off of the business section of the Oriental Daily. Both publications are owned by KTS Group, which is controlled by the family of the late Datuk Seri Lau Hui Kang. “We know that our strength is in business news. The Busy Weekly will enable us to leverage our strength,” says Ko. And, of course, the ultimate goal is to monetise it. The launch of The Busy Weekly will allow KTS Group to fight the war for ad spend in a different battlefield, which Ko believes the group has a better chance of winning than its rivals. The mass market for Chinese dailies is no doubt monopolised by Media Chinese International, which produces the Sin Chew Daily, Nanyang Siang Pau and China Press. Anyone who wants a piece of the pie will have to be nimble enough to outwit the giant guarding it. This article appeared in Corporate page of The Edge Malaysia, Issue 762, July 6-July 12, 2009
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