Media Politics

More than 2,000 Malaysian media jobs axed since GE14 and it might all be linked to one man

If you’re not working for a newspaper or the media in general, chances are you’ve missed the worrying news of hundreds of journalists possibly losing their jobs recently. Or maybe you haven’t paid attention, because people losing their jobs aren’t exactly unusual in this economy. And also because it sounds like a boring topic that won’t really affect you. After all, there are more sexy news to read out there.

China investments 0, celebrity armpit smell 1. News from Berita Harian and Berita Harian.

China investments: 0, celebrity armpit shenanigans: 1. News from Berita Harian and Berita Harian.

But you should know that this year alone, more than a thousand media workers have lost their jobs, and if rumors are to be believed, something fishy is going on that may lead to a situation that may indirectly affect everyone. It sounds a bit like a zen riddle, but we’ll get into more details later. For a start, it may be worth noting that…

 

The biggest layoffs so far seem to be from companies linked to the current Opposition

SUPRISE! Political story! Img from The Star.

SURPRISE! Political story! Img from The Star.

Before we put our tinfoil hats on, let’s make it clear that it’s not just Malaysian media workers getting laid off: in the US for example, more than 3,000 media jobs were lost this year alone, and between 2014 and 2017, 5,000 jobs were cut from the media market. So for the purposes of this article, we won’t be discussing the intricacies of the media market like the shift to digital and the death of traditional media and all that stuff you hear discussed over hazelnut macchiatos, and skip to the juicy factor: politics.

It’s an open secret that several of our newspapers have links to and/or funded by political parties, like how The Star is associated with MCA and how Utusan was associated with UMNO. So with the fall of some of these political parties from the ruling position after the 14th General Election, the media companies associated with them may suffer as well. For example, this can be seen by The Star’s shares being reported to hit an all-time low on May 16, 2018.

Artistic rendering of the event. Gif from Tenor.

Artistic rendering of the event. Gif from Tenor.

Some independent media seemed to thrive following the change though, with MalaysiaKini being reported to say that they now have more advertisers than they do space, but for others, things got bad financially, and letting go of employees is one way to save costs. While The Star have planned to downsize even before GE14, right after GE14 they announced the shutting down of one of their printing presses in Bayan Lepas, with an unreported number of staff there made redundant.

We’ve tried looking for more examples, but it would seem that the biggest cases within the past two years center around two media companies: Utusan Melayu (M) Sdn Bhd and Media Prima Berhad. We’ve already somewhat covered Utusan’s case before, but the gist of it is that a combination of decreasing readership and the lack of government assistance put it in deep debt, and to save itself it initially reduced its staff size (from an initial 1,400 to 823), but due to debt it finally shut down in October, putting an end to the newspapers Utusan Melayu and Kosmo!, as well as the jobs of the rest of its workers.

A sampling of companies under Media Prima. Img from Media Prima.

A sampling of companies under Media Prima. Img from Media Prima.

Media Prima’s case is a bit bigger, as it’s a huge company that owns several newspapers, television channels, radio stations and websites. But so far retrenchments seem to affect two outlets: free-to-air TV station TV3, and newspaper company New Straits Times Press. The TV3 exercise happened in November 2018, when Sistem Televisyen Malaysia Bhd, the operator of TV3 and subsidiary of Media Prima, gave 190 of its employees a three months’ notice and offered mutual separation schemes (MSS) to 43 others.

As for New Straits Times Press, the company behind New Straits Times, Berita Harian and Harian Metro, it was reported on Dec 16 that employees affected by their rationalization exercise have been officially notified. Although the actual number of affected people were not disclosed yet at the time of writing, it was previously estimated to be somewhere around 1,500.

Regardless of whether it will eventually happen or not, the layoffs affecting Utusan and Media Prima might have something in common…

 

These layoffs seem to happen after a common change in shareholders

Given the state of Utusan and Media Prima, it makes sense for a new shareholder to trim down some manpower to save the companies, so that by itself may not be very surprising. What’s interesting, though, is that the new shareholders to these companies are allegedly linked to one person:

*X-Files theme intensifies*. Img from Usahawan.com.

*X-Files theme intensifies*. Img from Usahawan.com.

The guy in the picture is Syed Mokhtar Albukhary, the 12th richest person in Malaysia according to Forbes. Described as ‘reclusive’ and ‘media-shy’ by news reports, Syed’s main industries are engineering, construction and energy, but he seemed to have dabbled in the media industry as well in the past few years, being said to own business paper The Malaysian Reserve as well as MYTV Broadcasting Sdn Bhd.

As for his alleged link to Utusan and Media Prima, it is through two companies:

  1. Nilam Setar (M) Sdn Bhd. Syed is not listed as a shareholder in this company, but MalaysiaKini had pointed out that it shares the same address as some of Syed’s other firms.
  2. Aurora Mulia Sdn Bhd. Syed’s son is listed as a member of this company’s board of directors.
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Nilam Setar seemed to only be involved with Utusan. Sometime in July this year, it made headlines when it became the second largest shareholder in Utusan Melayu (M) Bhd by buying an additional 5.5 million shares in the company, or about 19.72% of the shares. Previously, the bigger shareholders of Utusan have links to Umno: 31.6% was held by Opulance Global Asia Sdn Bhd, a company said the be controlled by Umno politican Abd Aziz Sheikh Fadir, and 18.2% was said to be Umno’s direct stake.

Well, Opulance don't own everything, but most. Img from WowReport.

Well, Opulance don’t own everything, but most. Img from WowReport.

Aurora Mulia, on the other hand, plays a bigger part in the story. In Utusan’s story, Aurora Mulia acquired 70% of Dilof Sdn Bhd, a company that held Utusan’s printing licenses and archives. This takeover happened in October, and Dilof’s name has since been changed to Media Mulia Sdn Bhd.

But even before Aurora Mulia bought off Dilof, it has substantial stakes in Media Prima already, having bought off some 123 million shares (roughly 11%) from an entity named Gabungan Kesturi Sdn Bhd in July. Gabungan Kesturi’s status is debatable, but some believe that its stake in Media Prima was held by Amanah Raya Bhd (a government-owned company) on behalf of Umno.

Within the same month, Aurora Mulia bought an additional 55 million shares, raising its share to 16.05% and emerging as the largest single shareholder in Media Prima. At RM0.60 per share, that’s at least RM106.8 million spent. But it doesn’t end there. Aurora Mulia’s stake in Media Prima kept growing, and the latest transaction seem to be in October, when its share increased to 31.22%, possibly by buying out the shares of another Umno-linked company, Altima Inc.

With these allegedly Syed-linked companies establishing itself in Malaysia’s media companies…

 

It might signal the move from government monopoly on the media to a private monopoly

Some have stated that unofficially, Syed Mokhtar is on the way to becoming the biggest media asset owner in the country, but like we’ve said before, Syed Mokhtar isn’t one to talk, so we have yet to find a report where he explicitly stated why he’s doing it. There were speculations, however, from him consolidating all his other less profitable media assets to getting content to put on his MYTV project from Media Prima.

There were several more, but one theory seems to be more worrying than the rest…

Uh-oh. Img from Bebasnews.

Uh-oh. Img from Bebasnews.

…and it has something to do with his relationship with the current Prime Minister, Dr Mahathir Mohamad. Syed Mokhtar has often been said to have a close association with Mahathir, and Mahathir himself had not denied their closeness, although he had stated the he’s close to almost everybody who is successful.

He is keen to grow, others are not so keen. Sometimes, where other people do not want to go in [to a business venture], he is willing to go in.” – Dr Mahathir, in reference to Syed Mokhtar, from a 2015 report by The Edge Markets.

Perhaps it is due to this closeness that Syed Mokhtar’s alleged buying of media companies raised several eyebrows. Hoo Ke Ping, a political analyst, had pointed out that dropping millions of ringgit on media company shares is not something many can afford, suggesting that the acquisition was ordered from higher up.

Adding to the theory is Mahathir’s stance on press freedom in the weeks following GE14. Back then, he had said something about limiting the stakes of political parties in media companies to no more than 10%. This move was said to ensure press freedom in the country, as it was an issue pre-GE14.

The buying out of Umno stakes from Utusan and Media Prima seem to support this theory, and some have warned of the consequences if it’s true. Nor Mohamad Shawaludin, a Johor Member of Youth Parliament, had claimed that Syed Mokhtar’s takeovers will allow Dr Mahathir to have personal control of the media for political purposes, and despite the government’s promise of media transformations, a monopoly will set press freedom back.

As put by Terence Gomez, a political economist from UM, a private monopoly will allow Dr Mahathir to have direct control over the press, without interference from the rest of the government.

“He (Mahathir) prefers the media to be in private hands because it allows him to dictate the agenda to the individual who controls these companies. He has a direct link with them, and they can take cues from him […] so he can have direct control. What this means is other people in the government have no control or say about these companies,” – Terence Gomez, to MalaysiaKini.

Not many expected to be screwed over by the guy owning four railroads, but it happens. Img from Pinterest.

People always realize the danger of the railroad collector too late. Img from Pinterest.

We must stress again that this is JUST A THEORY going around with no solid statements to back it up. However, some of the concerns surrounding the recent layoffs seem to allude to it. The National Union of Journalists Malaysia (NUJ) had lambasted the current downsizing in Media Prima, whilst stressing that the media should be free from political control, and the Gerakan Media Merdeka (Geramm) is concerned that the layoffs will lower the standards of journalism in Malaysia.

“The trend to reduce the scale of media operations has also created a sort of “job bottleneck” in the industry which, in turn, will lower the standards of journalism in Malaysia. In the age of fake news and hate speech on the Internet and on social media, it is imperative a free media stands up against impunity and acts as a counterbalance, a verificator and an agent of truth to the government and the people of a country.” – Geramm, to MalaysiaKini.

Will these concerns be put to rest? Well, perhaps it will, after more details have been brought to light. We’ll update the article when that happens… unless we got bought off first (feel free to contact [email protected]).

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