Friday 29 Mar 2024
By
main news image

This article first appeared in The Edge Malaysia Weekly on September 24, 2018 - September 30, 2018

GROUP chief operating officer Roy Tan talks about Star Media engaging its audience, politics, people, profit and property

 

Politics

 

The Edge: Is there any concern that Star Media Group is owned by a political party? (The Malaysian Chinese Association owns a 42.46% stake)

Roy Tan: Political ownership, I reckon, has been over-sensationalised. As a business, our shareholders want us to deliver a return, whether it’s a political party or other shareholders.

My view [is that] those in the media business are impacted in a much heavier fashion by the Printing Presses and Publications Act (1984). It is the government of the day that can actually decide how much flexibility we have.

 

So you are not concerned that there may be a change in shareholders? (The government is studying how to outlaw political ownership of news entities. Proposals have included limiting political ownership to a 10% stake.)

Whether it’s a political party or not, for me, it makes no difference. Because we’re a business. We yield dividends. Regardless of whether our major shareholder is party A or party B, my job is to make sure that I make a return on investment for them.

 

The new government has said that it wants to improve press freedom. What does it mean to Star Media? Will we see a drastic change in your content?

I think you will see the same content direction. From an analytical standpoint, post-election has always been bad for us. Our subscriptions will be down, our digital audience will be down. But [after] the current one [election], all metrics are up. Our circulation is up — print is actually up month on month. Our digital trend is 50% up from pre-election.

I think we are engaging our audiences well. I think our strategy is working.

 

So has Star Media been given a free hand with regard to content without any interference from the shareholders?

Even prior to the general election, I think there was less interference ... actually in the past, there had been less, although I can’t categorically say there was any in the first place. But I don’t think so. So, I think it’s less of an issue.

 

It’s less of an issue after the election … is this only your observation?

I think I need to take a step back — to contextualise the statement. The opportunity for us was to always present a more balanced coverage. In the previous election, we looked at moderation and that has been one of our mantras. Moderation means you need to present both sides — that has been what we’ve been trying to do. I think that has carried through to this election.

 

 

People and profit

 

What’s staff morale like?

I think it could be better. Different levels have different levels of concern. For all of us at the senior level, we roughly know where we’re going already. It’s cascading, so it’s slow. It takes time for that to filter through the organisation. It’s still early days for the transformation.

 

How do your editorial colleagues take it when they are called about content?

Esther [Ng] and I talked and she is really proud to be the first chief content officer in a news company in Malaysia. She says it’s because you can either lead or you can follow. And for Star Media as a company, we want to lead.

An editor just edits stuff, a content creator drives the future. Executive content officers now understand what it takes to rediscover that. The transformation is cathartic for them.

 

Over the last three years, Star Media had one round of job cuts. And within the industry, the group is well known for its bonus payments, which have been declining. The company has been talking about streamlining, cost cutting and rightsizing. Having been through that turbulence, is the worst over? The rumour is that there may be another round of job cuts.

I think that is something that we are taking step changes [for]. We know what our operating model looks like — if it hits a step that we predicted, we will take the appropriate [action] at that point. But at every stage, we will always be a profitable entity. I think [rightsizing] is actually good initially, because the business is at the right size at the right time, and the right employees are on board for the right outcome.

My analogy is myself. I’m 45, I’m overweight, can probably get a lot thinner. I think I need to get fitter. So, I could probably afford to lose a few pounds — at this stage, I need to be healthy. And I think Star Media as a company — since this is its 48th year — is kind of a reflection of that. As long as we as a business are healthy and sustainable, that’s great.

We don’t believe in kitchen sinking. We need to make micro-adjustments — and that is speed and agility.

 

You think micro-adjustments here and there will help?

The question is what do you think we’ve done — kitchen sinking or micro-

adjustments?

 

In the industry, Star Media’s job cuts is seen as a very drastic move.

That’s what you call kitchen sinking? You’ve got a sense of humour! When I say that, I suppose that is a matter of perspective. Slight adjustments.

 

That (job cut) is a slight adjustment?

Context is everything. Here’s the thing. I’ve seen how real kitchen sinking has been done overseas. I’ve seen billion-dollar write-downs.

 

 

Property

 

What are the plans for the land in Penang? (Star decided to cease operations at its printing plant in Bayan Lepas this month.)

The land is actually a good opportunity. It’s one of those zones that is gazetted for auto (production). We’re looking at how we can create value for shareholders. The lazy man’s way would be to sell it, but I reckon we’re not that lazy. The smarter plan would be to see what more we can do with it.

 

What about the group’s other parcels and properties?

We now have a property segment that looks specifically into those properties [and potential for development]. We’re looking to unlock value in them — if it’s in a rental location, if there’s redevelopment potential or in some places, where selling seems to be [a better option].

We haven’t gotten any clarity on what we’re going to do with the land in Bentong but we are looking into it. There’s a team involved in that. I don’t manage that part of the business.

 

But that would involve extra costs as well, right?

People shouldn’t be looking at cost, you should be looking at it as an investment. Any expenditure that we incur, any investment, all of it is with an intent [that is] aligned to our business. That fiscal responsibility is very clear within our organisation.

 

On using proceeds from the Cityneon disposal to diversify the group’s business, has there been any progress on that?

We’ve reviewed a lot of potential deals. I can’t say anything at this point in time because of the nature of those discussions, but I can tell you that we’ve looked at many deals, from big to small, from digital to non-digital, to some of the more unusual deals ... by ‘unusual’, I mean non-core.

 

Is this one of the non-media businesses that Star Media is diversifying into? Or is there more?

I think our chairman did mention [some of this] during our annual general meeting, so our corporate side is looking at acquisitions for that. I personally think the acquisitions should be strategic in nature and relevant to the business, so that management knows how to manage those assets.

 

 

Save by subscribing to us for your print and/or digital copy.

P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

      Print
      Text Size
      Share