Rev Asia Culls Titles, Lays off Staff

Digital media group, Rev Asia Bhd, listed on the ACE Market of Bursa Malaysia, is cutting certain print and digital publications from its stable, as its publishing business sees a slide in revenue.

The affected print titles are Stuff, Fairways, Mint and Clive, while digital titles are Business Insider, Signature Asia and Stuff.tv/my. Rev Asia holds franchise rights to many of these titles in Malaysia as well as select markets in the region in some cases, providing editorial and / or sales services. The Stuff.tv website is operated by Haymarket.

In a general announcement last week, managing director Voon Tze Khay said that the company has "restructured our teams around the renewed focus on Says, 8Share, OhBulan!, Juice and Hanger."

"... in 2015, the group will hone in with laser focus on being the No. 1 provider of viral sponsored content and trendsetting integrated media campaigns," he said.

This came even as the company began informing staff that they would be laid off. Rev Asia declined to give numbers when queried by Digital News Asia (DNA) but sources said that whole teams have been laid off.

"Considerable efforts were taken to transfer staff to other business units within Rev Asia," Voon told DNA when asked if attempts were made to redeploy affected staff to other parts of the company.

Rev Asia was formed late last year from the approximately USD 20 million merger between select parts of Catcha Media Bhd and Says Sdn Bhd, which operates the Says.com 'crowd-sourced content broadcasting platform'.

Says.com uses active social media users to curate and share trending news items, paying them when they broadcast advertiser-sponsored content.

Catcha Media said then that the two parties were coming together to form a digital advertising business that could revolutionalise the way advertisers reach out to Malaysia's increasingly socially connected populace.

The merger was hailed by the Malaysian media-buying and advertising industry, but the company has had its ups and downs since.

While the long-standing agreement between Catcha Media and Microsoft Corp for the former to operate select MSN portals ended earlier this year, Rev Asia landed an agreement to operate Business Insiders sites in Indonesia, Malaysia and Singapore.

According to Rev Asia, as at January 2014, the popular business and technology portal had 211,000 unique users per month from Indonesia, 370,000 from Malaysia and 540,000 from Singapore. DNA could not get further information on what led to the decision to cease the relationship with Business Insider, and if the US-based portal would be looking to work with other parties. The original agreement with Rev Asia is believed to have been for a period of three years.

When we reached out to Business Insider Inc President and Chief Operating Officer, Julie Hansen via email, she said she couldn't "comment on contractual matters."

In July, Rev Asia announced it had struck an exclusive sales representation agreement with HCK Media Sdn Bhd, which publishes a host of titles including premier business weekly Focus Malaysia, to resell and operate all advertising inventory across the latter's digital assets.

In October, it acquired Malay entertainment website OhBulan!, which should have given it a foothold in the Malay-speaking market and a potentially lucrative segment of the Malaysian media industry. But despite having landed 'sponsored content campaigns' with major advertisers like Celcom, Samsung, Maxis, Unilever, GAB and more, Rev Asia's revenue has taken a tumble.

In an interim report filed with Bursa Malaysia, the company said that for the current financial period ended September 30, 2014, it recorded revenue of RM 20.2 million, which was RM 5.0 million or 19.9% lower than the preceding year's corresponding period.

Its online media and social media business contributed a combined revenue of approximately 62.5% (2013: 45.4%) of the group's total revenue; while its publishing business registered a revenue of RM 7.4 million, which was RM 2.2 million or 23.1% lower than the preceding year's corresponding period.

Rev Asia also had an e-ommerce business which recorded revenue of RM 170,000 in the current financial period as compared with the RM 4.1 million in the same period last year but discontinued the business at the end of the first quarter.

"Online media, social media and publishing business contributed a combined profit before tax of approximately RM2.2 million in the current financial period which was RM888,000 lower than the preceding year's corresponding period," Rev Asia said in its Bursa statement.

Its online classifieds business recorded a loss of RM 1.8 million "mainly due to the share of loss in iCar Asia amounting to RM 7.8 million during the financial period which was being offset against the RM 6.0 million gain arising from the dilution of the Company's interest in iCar Asia Ltd," it added.

Rev Asia's revenue for the current quarter was a decrease of RM 932,000 or 12.3% compared with the revenue in the previous quarter.

Viral, social-integrated content

Meanwhile, of its other titles, Voon told DNA that "Juice" will continue business as usual, with fully integrated platforms across digital, print, mobile and events," while Says.com will continue to lead viral news content space with mass audience.

"8Share.com will continue to lead and enhance its social content distribution network for advertisers and brands in Malaysia, the Philippines, Indonesia and Vietnam; and OhBulan! will continue to expand and enhance its reach and viral news content," he added.

When it came to the layoffs, Voon said that the notice period and severance package are "in accordance with guidelines set out in individual employment contracts."

According to one souooroce DNA spoke to, severance packages were 10 days' wages per year for those with less than two years of service; 15 days' wages per year for those with between two to five years of service and 20 days' wages per year for those with five years and above.

As for redeployment to other parts of the company, one staff member told DNA, "We've been told that they would list down the available vacancies elsewhere in the group. They have yet to produce this list."

"There was absolutely no prior indication whatsoever," the staff member added, when asked if Rev Asia management had ever broached the subject of possible layoffs.

One source close to the company told DNA that employees "had always wondered about the company strategy, which involved acquiring as many titles as possible without actually investing in the resources and staff needed to manage each title."

Asked when its current move to cull and consolidate will see a material effect, Rev Asia's Voon said, "We anticipate a favourable impact to the overall business at the beginning of the second half of 2015."

"Rev Asia's mission for 2015 remains the same and that is to lead the media revolution. We will continue to embrace and enhance our focus on viral news, sponsored content and native advertising, as well as providing trendsetting integrated media campaigns to advertisers and agencies," he added.

Meanwhile, in response to DNA queries, Haymarket Consumer Media Asia brand director, Andy Jackson said that the cessation of ties with Rev Asia would have no impact on the Stuff.tv website.

"As the incumbent print licensee, we worked with Rev Asia following the launch of the dedicated Malaysia and Singapore editions of the Stuff website last year, giving it access to the site to promote the print edition and allowing it to sell local ad campaigns to local clients."

"There was never a formal licensing deal in place as it didn't need one - it wasn't a licence. From day one, the site has always been produced, populated, managed and marketed by the regional Stuff editorial and publishing team here at Haymarket in Singapore."

"It's proven incredibly successful with the site showing phenomenal growth this year of over 300% in terms of unique browsers and 600% in terms of pageviews. So from the web perspective, it's business as usual," he told DNA via email.

Jackson said the decision to cease the arrangemen was ultimately by Rev Asia, so that it could focus on brands it owns.

"That's an understandable strategy and a decision we respect, so from that perspective this was a mutual decision and we thank Rev Asia for its partnership on the brand over the last 10 years," he added.

As for the print edition of Stuff Magazine, Jackson said Haymarket would be considering its options and talking to "some relevant partners for the next phase of the brand's long and successful presence in Malaysia."

Source: Digital News Asia

Written by: A. Asohan with additional reporting by Gabey Goh

Date: 17 December 2014

#articles