Singapore Press Holdings (SPH)

[Ben]

For your case, since you are buying on a daily basis i would say it benefit SPH even more since you are paying more for that.

No way SPH will benefit from people buying ad hoc as compared to long term subscription:

1. Papers selling from newsstand is the same price as subscription
2. SPH will not enjoyed a lump sum payment in advance if people just buy ad hoc
3. Revenue for ad hoc purchase is not certain
4. Circulation figure for ad hoc is not certain

These reasons are probably why SPH drive an aggressive marketing campaign last year to sign up subscribers.

[Bibi]

For your case, since you are buying on a daily basis i would say it benefit SPH even more since you are paying more for that.

No way SPH will benefit from people buying ad hoc as compared to long term subscription:

1. Papers selling from newsstand is the same price as subscription
2. SPH will not enjoyed a lump sum payment in advance if people just buy ad hoc
3. Revenue for ad hoc purchase is not certain
4. Circulation figure for ad hoc is not certain

These reasons are probably why SPH drive an aggressive marketing campaign last year to sign up subscribers.

1. i search internet and got this figure: $26.65/mth for ST paper/online/ipad or iphone or andriod phone. Equates to 26.65*12/365 = $0.876 per day. I have not been buying ST for a decade but i vaguely remember this price should be cheaper? Now is 90 cts right? If you didnt get this price, i think the "free" gift you received must have been priced in. I believe if only subscribe for ST paper, should be even cheaper.

2. This is true.

3/4. For pp who are buying on daily basis as what you did. More or less certain.

---

For your case, since you are buying on a daily basis i would say it benefit SPH even more since you are paying more for that.

No way SPH will benefit from people buying ad hoc as compared to long term subscription:

1. Papers selling from newsstand is the same price as subscription
2. SPH will not enjoyed a lump sum payment in advance if people just buy ad hoc
3. Revenue for ad hoc purchase is not certain
4. Circulation figure for ad hoc is not certain

These reasons are probably why SPH drive an aggressive marketing campaign last year to sign up subscribers.

1. i search internet and got this figure: $26.65/mth for ST paper/online/ipad or iphone or andriod phone. Equates to 26.65*12/365 = $0.876 per day. I have not been buying ST for a decade but i vaguely remember this price should be cheaper? Now is 90 cts right? If you didnt get this price, i think the "free" gift you received must have been priced in. I believe if only subscribe for ST paper, should be even cheaper.

2. This is true.

3/4. For pp who are buying on daily basis as what you did. More or less certain.

I think you are right. I didnt notice the mthly delivery charges. $2 for HDB, 3 for Private, 4 for landed.

[lonewolf]

Let's do more number crunching!

1) If you buy from the newsstand every day, it will cost you 365 x $0.90 = $328.50

2) If you subscribe the all-in-one package;

a) on a monthly basis, it will cost you
(i)$26.65 x 12 + $24 (delivery for HDB address) = $343.80
(ii)$26.65 x 12 + $36 (delivery for private address) = $355.80
(iii)$26.65 x 12 + $48 (delivery for landed address) = $$367.80

b) on a yearly basis, it will cost you
(i)$319.60 + $24 (delivery for HDB address) = $343.60
(ii)$319.60 + $36 (delivery for private address) = $355.60
(iii)$319.60 + $48 (delivery for landed address) = $$367.60

2) If you subscribe to just the print edition;

a) on a monthly basis, it will cost you
(i)$24.65 x 12 + $24 (delivery for HDB address) = $319.80
(ii)$24.65 x 12 + $36 (delivery for private address) = $331.80
(iii)$24.65 x 12 + $48 (delivery for landed address) = $$343.80

b) on a yearly basis, it will cost you
(i)$295.60 + $24 (delivery for HDB address) = $319.6
(ii)$295.60 + $36 (delivery for private address) = $331.60
(iii)$295.60 + $48 (delivery for landed address) = $$343.60

ST Subscription Rates

Conclusion: If you just subscribe to the print edition and lives in HDB, even factoring in the delivery charges, its still cheaper than buying from the newsstand everyday. You just saves 20c from paying for a year subscription in advance.

Food for thoughts: I wondered how many subscribers pays a year subscription (or even a 2-year subscription) in advance. If the number is big (say 100K), its like getting interest-free $29,560,000 cash advance! Sweet!

[KopiKat]

Food for thoughts: I wondered how many subscribers pays a year subscription (or even a 2-year subscription) in advance. If the number is big (say 100K), its like getting interest-free $29,560,000 cash advance! Sweet!

Hey! I see some similarity to the 'Float' of Insurance biz (Warren Buffett is the master of using such 'Float' to generate good returns), but of course not of the same magnitude. Another possible reason why he's buying newspaper cos. ??

[Bibi]

Buying from news stand should costs (0.9*6 + 1)*52 = $332.80. Sat newspaper costs $1 . The amt saved might be small but the time saved from the hassle of walking to buy newspapers everyday can be spend on reading annual reports

[Ben]

There are a few days in the year where there is no print, so this has to be deducted from the costs of buying from newsstand. Also, if buying ad hoc, it is highly unlikely that one will buy every single day. Sure to have a few days where one missed buying.

However, the important point is not whether SPH gets more revenue from selling papers through newsstand or through subscription. SPH don't make profit (or make little profit) from selling papers; it makes profit from selling advertising space. And how well they can sell their advertising space is directly depending on how many people read their papers, ie, the paper circulation rate. Imaging if everyone buys paper through subscription, the circulation rate will be certain and it is easy for them to plan and sell their advertising space.

In the ideal world of SPH, they would hope that everyone sign up the subscription. In that case;

1. They can collect significant sum of money in advance. Revenue is locked in long term.
2. They can be certain of the circulation rate. No issue of over or under printing papers
3. They can reduce their selling and distribution costs significantly. Their distribution channels will be steamlined. No need so many delivery trucks, delivery men, middle men etc. Can consider outsourcing delivery services to those retirees or part timers, just like what Singpost is doing.

But of course, SPH ideal world is very far from the actual situation.

[CityFarmer]

There are a few days in the year where there is no print, so this has to be deducted from the costs of buying from newsstand. Also, if buying ad hoc, it is highly unlikely that one will buy every single day. Sure to have a few days where one missed buying.

However, the important point is not whether SPH gets more revenue from selling papers through newsstand or through subscription. SPH don't make profit (or make little profit) from selling papers; it makes profit from selling advertising space. And how well they can sell their advertising space is directly depending on how many people read their papers, ie, the paper circulation rate. Imaging if everyone buys paper through subscription, the circulation rate will be certain and it is easy for them to plan and sell their advertising space.

In the ideal world of SPH, they would hope that everyone sign up the subscription. In that case;

1. They can collect significant sum of money in advance. Revenue is locked in long term.
2. They can be certain of the circulation rate. No issue of over or under printing papers
3. They can reduce their selling and distribution costs significantly. Their distribution channels will be steamlined. No need so many delivery trucks, delivery men, middle men etc. Can consider outsourcing delivery services to those retirees or part timers, just like what Singpost is doing.

But of course, SPH ideal world is very far from the actual situation.

Let me add few points on top of the already well coverred topic.

When someone sign up for subscription, beside those cost reductions/benefits been highlighted, i believe it should also exclude the margin given to newsstand-holder. It gives further cost reduction to SPH.

The production cost of the content is fixed, a sensible strategy is to maximize revenue generated from the content.

To further increase the revenue generated from contents, SPH charge $2 extra/month to include digital version. The digital version must tag along with paper version is also make sense, to avoid the digital version cannibalizes the paper version.

[maniac]

Warren Buffett’s Letter to Newly Acquired Publishers and Editors

http://www.gurufocus.com/news/178231/war...nd-editors

[Jacmar]

Warren Buffett’s Letter to Newly Acquired Publishers and Editors

http://www.gurufocus.com/news/178231/war...nd-editors

Tks for the link. i think WB wold have love to takeover SPH if he could base on those criterias that he listed below:
(1) The town or city had two or more competing dailies; -- sph is a monopoly

(2) the paper lost its position as the primary source of information important to its readers, or -- sph is still the only source either electronically or in print

(3) the town or city did not have a pervasive self-identity. -- singapore brand is still strong

[CityFarmer]

Warren Buffett’s Letter to Newly Acquired Publishers and Editors

http://www.gurufocus.com/news/178231/war...nd-editors

Tks for the link. i think WB wold have love to takeover SPH if he could base on those criterias that he listed below:
(1) The town or city had two or more competing dailies; -- sph is a monopoly

(2) the paper lost its position as the primary source of information important to its readers, or -- sph is still the only source either electronically or in print

(3) the town or city did not have a pervasive self-identity. -- singapore brand is still strong

Fully agreed with WB views on newspaper biz.

In VB, the majority of the topics discussed are from the SPH's newspapers content. Imagine one day, if we will not refer to SPH newspaper content anymore, our discussion scope will be highly limited.

One last point, i believe the shareholding of SPH is restricted to oversea investor, but i am not sure the detail.