Singapore's transport and media sectors are likely to return to one-player industries following comments by government leaders that competition has hurt corporate balance sheets, analysts said.
The lack of success in liberalizing the two sectors has come under the spotlight since officials indicated the island's population of 4 million people lacked the critical mass to support more than one player in each.
In the media sector, the new print and broadcast entrants have yet to record a profit since monopolies ended three years ago and hopes of a turnaround in the near term are remote.
"Both are losing money and both are haemorrhaging and they are trying very hard to stop the haemmorrhage," Senior Minister Lee Kuan Yew, the city-state's founding father and first prime minister, said this month.
"But I don't think it's possible. I think both are going to keep losing."
The two players in the media industry are Singapore Press Holdings (SPH), traditionally a publishing firm, and broadcast entity MediaCorp.
Their inability to record profits has been compounded by economic woes that have plagued the city-state over the past three years.
SPH's MediaWorks broadcast unit racked up losses of S$40.2 million (US$23.24 million) in the financial year to August and MediaCorp Press, which runs the Today newspaper, chalked up a S$10-million deficit in the year to March.
Political analyst Seah Chiang Nee said the remarks by Lee, who remains a highly influential figure in the government, could signal a change was imminent.
"If history is any indication, Lee's message will almost certainly lead to some action to lighten or eliminate the contest -- either a closure of loss-makers or a merger of some products," he said on his Web site, www.littlespeck.com.
However both SPH and MediaCorp responded to Lee's comments by reiterating they are committed to their new commercial ventures.
Information and Communications Minister Lee Boon Yang also said in a speech to the Singapore Press Club this month that the government still favored competition in the sector but admitted the prospects were not good.
"Wherever we can, we will try to promote and encourage competition, but we are also realistic and if competition does not work ... we have to accept that the market itself is just too small to accept more than one significant player," he said.
"If our market proves too small for this degree of competition, the players will have to reassess their business strategies and ambitions."
Speculation of a change in the transport sector also heightened this week after bus service provider SBS Transit blamed a 92-percent plunge in third quarter profits on problems with its new operation, the North-East subway line, which opened five months ago.
It said revenues from the loss-making subway line were not sufficient to cover operating expenses, and also referred to "weak market conditions and keen competition."
Transport Minister Yeo Cheow Tong said last month that the government would not block moves by SBS and the other subway operator, SMRT Corp, to merge their businesses in order to avoid duplications.
"We realize now that operating a rail system involves a lot of overheads," Yeo said.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary
RSS