Edging Ahead

A highly successful Malaysian business magazine is gearing up to knock Singapore's socks off

By S. Jayasankaran/KUALA LUMPUR

Issue cover-dated November 01, 2001

ON OCTOBER 17, an advertisement in Singapore's The Straits Times issued a clarion call to "laid-off bankers, dot-gone marketers, unchallenged journalists and failed poets." The Singapore version of the successful Malaysian business weekly, The Edge, was looking for staff.

Due to hit the streets early next year, The Edge will be the first privately owned Asian publication to attempt to penetrate Singapore's advertising market, where spending on advertisements is estimated at S$1.7 billion ($939 million). There are no private, wholly Asian-owned publications printed in Singapore for the local market. The Brunei-owned Asia, Inc. magazine sells in Singapore, but also across the region.

The Edge was approved by the Singapore government in August. By historical convention, the major dailies of both Singapore and Malaysia are banned from each other's markets. The Edge, as a weekly newspaper, falls outside that category. But no such prohibitions exist for other Asian publications. "I don't know why no one else from the region has tried before," says a puzzled Singapore diplomat in Kuala Lumpur.

Part of the momentum for the venture came from the search for new sources of revenue after plans on the part of The Edge's owner, Tong Kooi Ong, to build a multimedia conglomerate in Malaysia were stymied. Tong, formerly a high-flying banker, is a casualty of the fallout from the sacking of former Deputy Premier Anwar Ibrahim, with whom he was closely associated.

Tong sold his bank to Malayan Banking last year. His subsequent attempts to take over a daily newspaper and a television station as the building blocks for his multimedia company were unsuccessful.

In fact, The Edge was initially one of Tong's smallest investments, made on impulse back in 1994 when he and four other businessmen stumped up 800,000 ringgit ($210,000) each to show that Malaysians could come up with a quality business paper. The publication posted losses for three years, and Tong's four partners sold their stock back to him and Ahmad Abdullah, his former partner in banking.

Tong revamped The Edge's management and brought in Ho Kay Tat, a seasoned business journalist, to give the paper its editorial direction. Ho concentrated on market-moving news, corporate deals and business exclusives, gradually adding sections on property, personal investment and lifestyle.

Since then, circulation has climbed steadily to more than 20,000 per issue. Last year, The Edge made a net profit of more than 2 million ringgit. The lure of a high-net-worth readership--and its skilful selling of that image--has resulted in a demand for advertising which has almost reached saturation point.

But the fact that the paper occupies a niche position means that growth is likely to be slow. In February last year, The Edge took control of The Sun, a loss-making national daily owned by businessman Vincent Tan. The plan then was to add a TV station and the beginnings of a multimedia company. But it was not to be: in March, the deal was called off with no reason given. Most analysts said at the time that Tong's links to Anwar were to blame.

Can The Edge be successful in Singapore? It seems possible. Singapore does not have any business magazine dedicated to local coverage. The republic's media giant, Singapore Press Holdings, closed down the city's only business monthly years ago.

The Edge is entering the market at the bottom of the business cycle and can cut costs by outsourcing editing functions back to Malaysia, where everything is cheaper. Tong will also be able to draw on the resources of his wholly-owned Financialzoo.com, a Singapore-based Internet company that provides on-line financial-transaction systems for brokers and banks. It also has a team of analysts that look at companies in the region, an asset that could dovetail nicely with the fledgling newspaper's activities.

Certainly, The Edge's competitors are viewing the paper's arrival with interest. "The Edge is a serious, substantial product," says a senior executive at Singapore Press Holdings, whose publications account for 65% of the republic's advertising in newspapers. "Any new player who's credible will put pressure on us."