Now, it's bracing for some competition, Singapore style.

On Nov. 10, SPH, Asia's largest newspaper company by market value, will take on state-owned rival Media Corp. of Singapore as it rolls out Today, a free tabloid targeted at commuters. The government has broken the country's media monopoly, but retains control of the first competitor.

``Even though (they've) increased the size of the cage, the bird is still in a cage,'' Bernhard Eschweiler, chief Asian economist at J.P. Morgan & Co, said recently about Singapore's deregulation.

Nobody doubts, though, that the new entrant will bring competition for readers and ads in an island state that has been dominated by the Straits Times since before Singapore gained its independence 1965.

``Competition will definitely be there,'' said Marc Tan, who helps manage S$250 million (US$143 million) at OUB Optimix Funds Management Ltd. For SPH, which has all of the market now, ``the only direction is down,'' he said. Tan recently trimmed his shareholdings of SPH.

The battle for the island's S$700 million newspaper advertising money is already promising to turn nasty.

In what were seen primarily as ``spoilers'' aimed at Today, SPH launched two more tabloids in the past two months -- Project Eyeball and Streats. The first targets young, Internet- savvy readers, while the second, a free publication, is a chatty, news and entertainment paper for commuters.

Still, according to an HSBC Securities report, SPH's share of the island's newspaper ads is likely to fall to 81 percent in three years from 100 percent now. Concerns about the new entrant have helped SPH shares slide 33 percent this year against a 23 decline in the benchmark.

Pieces of the Pie

SPH's three-tabloid attack raises questions about whether the island's advertising pie for English-language newspapers is big enough to satisfy all concerned.

``The Singapore market will not be able to sustain four general news tabloids,'' said Christine Ng, deputy managing director of Bartle Bogle Hegarty Ltd., a U.K.-based advertising agency in Singapore. Its clients include Unilever Plc, Singapore Telecommunications Ltd. and CNBC Asia.

SPH depends on ads for about 76 percent of its revenue of S$1.05 billion. Still, aided by 16 years of monopoly, the company has deep pockets. SPH has S$1.8 billion in cash and is dominant in distribution and production. Advertisers queue to get space in its 400,000 circulation Straits Times.

``Who the backers are and how deep their pockets are'' will be a key factor because it will be difficult for newcomers to turn a profit for some time, said Lawrence Lye, a senior analyst at Indosuez W.I. Carr Securities.

``It's going to be a difficult market for new entrants,'' said Stephen McKeever, a media analyst at Lehman Brothers Asia Ltd.

Today, backed by MediaCorp, bus operator Delgro Corp. Ltd., Singapore Telecommunications Ltd. and subway company SMRT Investment Ltd., says it's up to the challenge.

``I've always believed in competition,'' said P.N. Balji, editor of Today, who was lured from SPH's New Paper. ``There'll be blood on the floor. The question is how much and whose blood.''

Commuter Strategies

Today and Streats are each seeking circulations of 200,000 by giving away their tabloids to commuters and selling ads for revenue. Project Eyeball charges 85 Singapore cents per copy and hopes to corral 20,000. The New Paper has 130,000 circulation and sells for 60 cents a copy.

``We should (be able to) cover all the morning reader segments'' with our tabloids, the Straits Times and the Business Times, said Tham Khai Wor, SPH's executive vice president of marketing.

Some advertisers say Today's ad rates are high. A full page in black and white on weekends costs S$8050, while in Streats it is S$3675, the New Paper S$2646 and Project Eyeball S$2100.

Still, Today said it's receiving strong response from advertisers. A month before its launch, Balji said, it had signed three long-term contracts worth a total S$500,000. He declined to name the buyers.

Analysts say competition will intensify because spending by newspaper advertisers looks to remain about the same.

``I don't think we're going to see advertising budgets increase just because we have new media,'' said Darragh Hardy, general manager of Maximize Singapore, an advertising agency whose clients include Singapore Airlines Ltd. and Fox Entertainment Group Inc.

The other thing that's unlikely to change anytime soon is how news is reported in Singapore, media observers say.

``In terms of market share and advertising income, there will be pretty strong competition, but it will not change the fundamental way journalism is practiced in the country,'' said Hao Xiaoming, associate professor at Nanyang Technological University.