Everything we know (& don't know) about the SPH Media circulation scandal

Perhaps the most important question is: why were they being inflated?

Matthias Ang | Andrew Koay | January 14, 2023, 09:32 AM

Follow us on Telegram for the latest updates: https://t.me/mothershipsg

Earlier this week, news broke of an internal review that revealed SPH Media had inflated its circulation numbers.

A report published by socio-political site Wake Up Singapore (WUSG) on the evening of Jan. 8 found that three executives from the media organisation — which publishes The Straits Times (ST) among other titles — were set to leave over the discrepancies.

The news was confirmed by The Straits Times (ST) a day later, who quoted an SPH Media spokesperson as saying that those involved had either been "taken to task" or "left the organisation".

Those who haven't been following coverage of the scandal might be forgiven for feeling a bit lost amidst the deluge of articles written on the matter; at the time of writing, a quick Google search turned up at least seven pieces published by Mediacorp's English-language news sites.

So what's going on with SPH Media and why does it matter? We try and consolidate everything that's known about the situation so you don't have to feel left out.

Who is SPH Media in the first place?

SPH Media is the publisher of several newspapers and magazines in Singapore.

These include some of the biggest names in our local media landscape such as ST, The New Paper, Business Times, Chinese papers Lianhe Zaobao and Shin Min Daily News, Malay paper Berita Harian, and Tamil paper Tamil Murasu, and also magazines like HerWorld and Women's Weekly.

In the second half of 2021, Singapore Press Holdings (SPH) completed a restructuring that saw its media businesses transferred to a non-profit entity which was officially named SPH Media Trust, commonly referred to as SPH Media.

The move came after years of SPH experiencing shrinking profits — "largely to a decline in print advertising and print subscription revenue," the organisation said.

A few months later in February 2022, it was announced that this new organisation would receive up to S$900 million of government funding over a period of five years.

What has SPH Media done wrong?

On Jan. 9, after WUSG's report, ST revealed that SPH Media had inflated its daily circulation figures by between 85,000 and 95,000 copies across all its publications.

This represents 10 to 12 per cent of the reported daily average circulation, said an SPH Media spokesperson.

SPH Media had fudged the numbers through various means:

  • counting lapsed contracts in circulation data
  • including copies that were printed, counted for circulation, and then destroyed
  • multiple instances of double-counting subscriptions
  • injecting a project account with additional funding to purchase fictitious circulation

In addition, certain circulation numbers were arbitrarily derived, according to ST.

How was it discovered?

The discrepancies were uncovered during a review of internal processes initiated in March 2022.

The period under review was September 2020 to March 2022.

However, the discovery only came to light nine months later after WUSG reported on the matter on Jan. 8, 2023.

How did SPH Media react to the discovery?

According to ST, the staff involved in inflating the circulation numbers were either "taken to task" or have "left the organisation".

No further details were revealed, except that they included "several senior employees".

Advertising and media site Marketing Interactive reported that SPH Media spokesperson did not clarify if SPH's chief customer officer was impacted but sources close to Marketing Interactive said that he is no longer with the firm.

WUSG reported that three executives — "industry veterans with more than five decades of experience among them" — were set to leave SPH Media due to the discrepancies.

Anonymous sources who spoke to WUSG said that the decision to part ways was reached on or around Dec. 23, 2022.

In addition, the SPH spokesperson quoted by ST said the organisation had "immediately taken steps to strengthen processes".

What does circulation data mean?

Circulation data refers to the number of copies that are distributed through either regular subscriptions, or one-off purchases, while readership is an estimate of a publication's number of readers.

A circulating WhatsApp message that has been attributed to a former editor of The Straits Times, Leslie Fong, also highlighted the following points about such data: that under Singapore's Audit Bureau of Circulation (ABC), if a household pays for a print copy, as well as a digital subscription, the sale can be counted as two copies.

Today confirmed the veracity of the message with Fong, who was quoted as saying that this double counting is legitimate.

Was advertising in SPH affected?

According to SPH's former Chief Marketing Officer, Elsie Chua, the marketing department does not guarantee circulation in contract with advertisers.

In a Facebook post put up on Jan. 10, Chua said that the reach of a media outlet for marketers and advertising agencies is based on data that is conducted by Nielsen — a U.S.-based company that measures audience-related data for various media outlets around the world.

Chua added, "Readership numbers are a better gauge for advertising effectiveness and offer deeper insights into audience demographic and psychographic profiles."

In addition, circulation and readership numbers were decoupled years ago due to changing market trends.

Chua highlighted that while one printed copy sold could translate to four readers 20 years ago, changing household sizes and the replacement of printed newspapers with digital copies means that such numbers no longer correlate.

She elaborated that for marketers, reach is determined through readership, not circulation, while effectiveness is determined through various factors of ad responses.

Cost efficiency in evaluating media options is also involved.

CNA further reported that on Jan. 10, SPH Media CEO Teo Lay Lim told advertisers in an email that circulation data was not used for the basis of advertising packages.

Instead, media rates and advertising packages were based on the metrics of reach and readership, which in turn were calculated by independent third-party research agencies, said Teo Lay Lim.

The lack of impact on advertising does not take away from the gravity of the situation

In response to this, the President of the Association of Advertising & Marketing (AAMS), Goh Shufen, said that not using circulation data for advertising packages does not "exonerate" the practice of falsifying circulation figures.

Goh further expressed disappointment with SPH Media and was quoted by CNA as saying, "As a national medium, and virtually the voice of Singapore, one would expect its responsibility to extend well beyond just commercial boundaries."

She added that she hoped to meet with SPH Media to work on restoring trust and ensuring the "highest standards" for the marketing and advertising industry, in light of the steps that the organisation has taken to address the situation.

How does all this affect Singaporeans?

The fact that SPH Media will receive up to S$900 million of taxpayers' money, over a period of five years, has also compounded the issue and is one of the biggest factors in why there has been an online backlash against SPH Media in the wake of the news.

SPH Media was supported by MCI because readership & trust in its journalism remains high

In February 2022, Minister for Communications and Information Josephine Teo gave the following reasons behind the government's funding for SPH Media:

  • The need to support SPH Media's new operations following its restructuring
  • Allowing public interests to be served
  • Allowing the government to maintain accountability

Teo said Ministry of Communications and Information (MCI) worked closely with SPH Media to understand the entity's challenges, despite a seemingly healthy readership.

She also highlighted that SPH Media's weekly reach extends to almost 75 per cent of Singaporeans and that readership and trust in its journalism "continues to be high."

SPH Media is also supposed to be an extension of Singapore's brand

The minister also alluded to how SPH Media is an extension of the Singapore brand as a node in the international community and well-placed to "provide deep domain knowledge about the region, with a Singapore voice".

She added that SPH products can be used to counter psychological operations launched from abroad, while providing Singaporean perspectives.

Teo said: "As much as the media is coming under challenge throughout the world, we must be mindful that the major powers are waging a constant battle for hearts and minds worldwide – including our hearts and minds in Singapore."

"As a small country, we are especially prone to influence campaigns – overt or covert," she noted.

So what will the government & other authorities do next?

According to Today, MCI will now undertake a review of the inconsistencies and has received SPH Media's internal report on their audit.

An MCI spokesperson was quoted as saying that the probe would determine if "these inconsistencies in circulation data affect the decision to fund, and the amount the government committed to fund SPH Media".

Today also reported that the Singapore Exchange (SGX) Group, the regulator of Singapore's stock market is reviewing SPH Media’s circulation information, "including its materiality and time of occurrence".

This is because SPH Media publications like ST and BT were part of then Singapore Press Holdings and SPH was listed on the SGX until Dec 2021.

What don't we know yet?

Questions still remain, however, especially regarding the manner in which the information emerged.

In a Facebook post, Bertha Henson, a former ST editor noted that it was WUSG that first broke the story.

She further wrote, "Would ST (The Straits Times) even have reported this if it wasn’t put out there?"

SPH Media's statement on the matter has also been vague.

It did not mention how long the inflation of circulation numbers has been going on, nor the number of employees who were "taken to task" over the matter, except that they are senior staff.

What exactly "taken to task" means has not been reported either.

As for the three executives who have left SPH Media, their LinkedIn profiles state that they are still with the company as of Jan. 8, 2023, according to WUSG.

There also remains the question of how copies were wastefully destroyed regularly in the era of sustainability and perhaps more fundamentally, in the spirit of accountability as a Company Limited by Guarantee (CLG) and public trust, how the various means of inflating the numbers came to be in the first place and why.

Top image by Lee Weilin