Ciaran Davis, the chief executive of ARN Media, has dropped a few bombshells along the way in his 14 years leading the radio broadcast group.
Arguably the two biggest have come in the past few weeks. First was the announcement of a takeover offer for SCA. The second was yesterday when the business revealed contract extensions for two of its key hosts – Kyle Sandilands and Jackie Henderson plus Christian O’Connell.
Davis was at pains to point out yesterday the two are unconnected. He explained to Mediaweek that yesterday was all about the talent, and he wouldn’t be discussing the SCA takeover.
Regarding the significant increase in talent fees, Davis was also guarded. On the deal, he did share: “On the construct of the contract, we like it in terms of the layers. The revenue share affords an opportunity for everybody to earn good money. There’s upside for everybody. The ownership of shares is a good thing as well.
“There is an increase in base salary. The additional elements also ensure that everybody is motivated to make it successful.”
Calculating mega-star salaries
Davis: “The revenue share announced by ARN Media yesterday is triggered by incremental revenue growth on the stations the stars broadcast on. There are 7,000,000 shares being issued [in total] to the three and they don’t vest until the contract period is over. We think we have spread the risk and reward with the talent.”
Competitive interest in Kyle and Jackie
Choosing his words carefully about any bids from competitors to poach any of the broadcasters, Davis said: “There is competitive interest in great talent everywhere in the world.”
Speaking about the broadcasters in both Sydney and Melbourne, Davis added: “Their success is phenomenal and continues to be. For the last 10+ years, we have had a strategy of recruiting and retaining the best talent and this was part of it. As to whether other networks were talking to them, I’m sure they were. I would if I was another network.”
While the company has confirmed Kyle and Jackie will be live into Melbourne in the future, there is a risk the audience may not welcome a Sydney-based breakfast show. “There is a risk in any changes you make,” said Davis.
“There was a risk putting Christian on in Melbourne when we brought him over from the UK. There was a risk when we took Kyle and Jackie O from 2Day FM. The continued audience growth we see from Kyle and Jackie and the growth in younger audiences they attract, and the increase in listening to their catch-up podcast out of Victoria, suggests they will be successful.”
ARN is prepared for any competitors trying to spoil the networked offering by proclaiming they are the live and local breakfast option. “The style of program and content Kyle and Jackie do is universal. Over the last 12 months there hasn’t been as much Sydney focus. While live and local is an important part of radio, this is such a unique show with such great chemistry. There aren’t many shows in the world that could do that.”
Axing Jase and Lauren
It’s not every day a radio executive would pull the pin on a program with a cume audience over 1m in a market the size of Melbourne.
“You are right, a cume over 1m is terrific. What we had to look at for the next couple of years what was the revenue potential. We have had cume for a long time, but we are still not writing as much revenue as we think we can. It’s a tough decision, but we have to make that decision on how much revenue we think we can write from the audience Kyle and Jackie can generate.”
Fans of Jase can perhaps be pleased that they might still him on the ARN airwaves. “Jason is still under contract and Jason will be staying,” confirmed his boss. As just to what that might be, Davis paused…and then shared, “To be announced.”
Getting Melbourne ready for Kyle and Jackie
Just when Kyle and Jackie will start of Melbourne’s KIIS 101.1 is yet to be revealed. The company hasn’t revealed the 2024 start date, which should be at the start of survey on Monday January 15, 2024.
Is there a chance they could do a sneaky week of Kyle and Jackie O into Melbourne beginning December 3? “To be announced,” said Davis wishing to move the conversation on.
Selling Kyle and Jackie to advertisers
Davis said the ARN sales team is poised to move on selling the next 101.1 breakfast team. “We have a terrific team already in place. The show attracts both agency and direct clients. They have a very popular show and generate great audiences.
“We will have to prove the audience for advertisers and then educate advertisers on the kind of show it is and the connection it has with the audience. Then show how advertisers can benefit being associated with the engagement the audience has with Kyle and Jackie.”
Is the Melbourne audience ready for Kyle and Jackie plus Intern Pete, Pedro, Mayo, Josh? “You asked me the same question when Christian came. Was Melbourne ready for an English accent on the radio.
“The Melbourne audience is the same as the Sydney audience, and any audience in the world. Some people won’t like it and some people will. Those that do like Kyle and Jackie tend to love it and are very loyal, passionate listeners. We absolutely believe will generate those down there.”
As to whether the team need to broadcast much out of Melbourne, Davis said occasionally they will be. He noted they are not always in Sydney either with Kyle sometimes broadcasting out of Sydney. Sometimes from an exotic location, and other times during an Australian Idol road trip.
The future home of Christian O’Connell
ARN imported Christian O’Connell from the UK. He managed to build a new show and take it to the top of the ratings for 27 of the last 28 ratings surveys. Then ARN goes and re-signs O’Connell this week for five more years.
In the background though ARN is trying to acquire the Triple M network. A move that means it would have to sell off Gold 104.3, the home of The Christian O’Connell Show. Surely they would not abandon the broadcaster?
Davis: “I don’t want to link the two things [a new contract and acquiring Triple M]. We have been talking to Christian [regarding contract renewal] for a period of time. He is signed to the network.”
Has Christian asked where he might be broadcasting from next year? “He is under contract to ARN. Today I would just like to focus on the new contract.” Ok.
As to whether Christian O’Connell could be networked into other markets live, Davis said: “Don’t know I would say. We will focus on Kyle and Jackie into Melbourne first.”
When asked who was the toughest in contract negotiations – team O’Connell or team Kyle and Jackie O – Davis replied: “What about team ARN? Contract negotiations can be tetchy at times. But that is the nature of good negotiations. Everybody has approached it in a professional and logical way. That has been pleasing because it shows there was trust between the parties and good intent from all wanting to continue working together. That was very evident as we went through the process.”
As to questions the CEO fielded from the ARN board, Davis replied: “The board had questions about the appetite from the audience for Kyle and Jackie O over that period of time, the ability to grow the audience and the ability to grow revenue off the back of that.”
Exploiting the IP
With two expensive talent packages to feed every year, Davis indicated there was scope to exploit the talent even further. “As audio consumption continues to digitise even more there are lots of opportunities we are looking at around The Christian O’Connell Show and The Kyle and Jackie O Show.”
Davis was not willing to be drawn about Mediaweek’s suggestion of a potential Intern Pete program.