Business of Media
Seven West media to sell The West Australian head office
Seven West Media is believed to be nearing a deal to sell the headquarters of The West Australian and The Sunday Times to local developer Prime West for $74.5m, reports The Australian’s Bridget Carter.
It is a move seen as one that will provide some much needed financial relief for the Kerry Stokes-backed free-to-air broadcaster.
Prime West, a Perth-based property syndicator with over $3.8bn of real estate under management, will be buying Seven West’s office and print centre, covering three properties within Osborne Park, with three-storey office buildings on just over 2 hectares of land at 50 Hasler Rd on the outskirts of Perth’s central business district.
Why the government is moving to tame the digital duopoly
In the past decade, Australia has lost more than 100 local and regional newspapers, writes Paul Fletcher, Minister for Communications, Cyber Safety and the Arts in The AFR.
Just in the past few weeks, with COVID-19 driving a sharp fall in advertising revenues, publishers have announced further closures or suspensions.
Australian media businesses – such as News Corp, Nine Entertainment Co, Seven West Media, Australian Community Media, Foxtel and many regional broadcasters – are under pressure. Their profits and revenues are declining; if they are listed, their share prices are way down.
At the same time, the giant global digital platforms, particularly Google and Facebook, are thriving in the Australian market as they secure more eyeballs and advertising revenue from Australian media businesses.
Domain staff opt for shares, new debt facility locked in
The vast majority of Domain employees have opted in favour of a cost-cutting measure in which they will take a 20 per cent pay cut but receive that same amount in share rights, to help the property classifieds and services business combat the COVID-19 downturn, reports The AFR’s Max Mason.
Domain, which is 59 per cent owned by Nine, has also secured a further $80 million debt facility from its existing banks, and will announce a range of other cost saving measures.
Domain’s senior leadership team will take a 30 per cent pay cut, and chief executive Jason Pellegrino and the company’s board will take a 50 per cent cut.
Employee costs make up 45 per cent of Domain’s cost base, so the project will have the significant benefit of a large cost reduction, keeping many employees at work so the company can keep operating at normal levels of capacity to help it during the COVID-19 pandemic and recovery, Pellegrino said.
The COVID-19 pandemic has caused a massive drop off of people looking to sell and buy homes, which in turn affects businesses such as Domain and REA Group, majority-owned by News Corp.
News Corp Australia calls in Deloitte for major restructure
Rupert Murdoch’s News Corp Australia has hired consultants to cut costs at the media organisation by centralising some editorial and commercial functions, cutting print production of some smaller newspapers and reviewing its regional newspapers business, reports The Sydney Morning Herald’s Zoe Samios.
Industry sources who spoke on the condition of anonymity confirmed the publisher of The Daily Telegraph and the Herald Sun has hired consultants Deloitte to advise the company on the restructure of its newspaper division.
Sources told The Sydney Morning Herald and The Age that News Corp had planned to stop printing almost 30 of the newspapers before the crisis, but sources stressed the figures are not confirmed and could be higher or lower once a final decision is made. It is unclear how many jobs will be affected as part of News Corp’s latest plans, which are in the early stages.
News Corp declined to comment.
Seven West Media’s revenue falls as media companies struggle
Seven West Media’s television revenue fell by almost a fifth in the first quarter of the year while the broader commercial free-to-air industry was down 8 per cent even before the coronavirus pandemic caused advertising to plummet across the media sector, reports The Sydney Morning Herald’s Zoe Samios.
News and current affairs programming helped Seven obtain a 34.9 per cent revenue share among the commercial free-to-air networks, placing them second to Nine Entertainment Co for the quarter.
But Seven’s revenue of $186.6m was down by 4.4 percentage points from 39.3 per cent last year, according to confidential ThinkTV data obtained by The Sydney Morning Herald and The Age. Revenue for the same period last year was $228.5 million.
Nine booked $234.04 million worth of advertising between January and March, while Network Ten made $113.28 million.
Regional publishing: ‘I won’t let this newspaper go down without a fight’
Sharon Thompson sits in her office. There is one other person who is manning the front desk. The office is quiet, but Thompson’s phone is running hot. She is calling her readers to tell them there will be no paper this week. Or the next, reports Guardian Australia’s Kirsten Jelinek.
The Quirindi Advocate had weathered it all – wars, drought, the Great Depression and the global financial crisis – and its doors have never needed to close. Until now.
After surviving the media’s transition to the digital age and four years of relentless drought, 2020 has delivered a paralysing blow. Covid-19 has crippled the Advocate, first through the loss of advertising revenue and now the printing presses in nearby Tamworth are closing.
It’s one of the many regional newspapers to have fallen victim to this pandemic. But unlike many others it is fiercely independent and 100% local; a lifeline that connects remote communities, severed at a time when communication is needed more than ever.
Launched in 1885 as the Quirindi Gazette and Liverpool Plains Advocate, the newspaper was renamed the Quirindi Advocate in 1925. This July is its 95th birthday. Thompson remains hopeful it will live to celebrate this milestone and stay in circulation until it reaches its centenary.
3AW breakfast hosts welcome back colleague sacked overnight host
At 5.30am this morning, 3AW breakfast hosts Ross Stevenson and John Burns welcomed back the sacked overnight host back to the station.
Tony Moclair was dropped as host of 3AW overnights last year when the Nine Radio network decided to network the program hosted by Michael McLaren in Sydney and Brisbane into Melbourne. Now Nine Radio management via head of content Greg Byrnes has welcomed Moclair back to the #1 Melbourne radio station.
In an email to notify staff of the change on the weekend, Byrnes said: “At the start of the year, we made the decision to return our evening programming to the local market with Denis Walter on 3AW and John Stanley on 2GB.
“The big audiences that both Denis and John have attracted at night shows our listeners seek the companionship and connection of a local voice. Returning Tony to overnights in Melbourne is recognition of that, as well as the high regard in which we hold him as a 3AW broadcaster.”
Byrnes went on to thank Michael McLaren for his work in recent months, and noted the change will now allow him to focus more on Sydney and Brisbane listeners.
Nine Radio has not been afraid to overturn previous management decisions. One in particular that proved popular with staff was the return of Stephen Beers as 3AW station manager last October. Hiring former 2UE PD Greg Byrnes was also a popular move. 2GB re-hired Chris Smith in December and Nine dumped the old AM sports format in favour of bringing back music to the Magic, 2UE and 4BH stations.
Radio stars land podcast-only roles as market matures
Commercial broadcasters are luring high-profile talent to podcast-only formats in a sign Australia’s podcasting market is thriving as listenership booms, reports The Age’s Broede Carmody.
Several big names from radio and television have signed with commercial companies during the past fortnight despite the COVID-19 pandemic harming the broader advertising market, including former Triple J presenter Tom Tilley and The Chaser’s Charles Firth, Dom Knight and Andrew Hansen.
Southern Cross Austereo chief executive Grant Blackley said podcasting revenues were up 141 per cent in the first half of this year compared to the first half of 2019. In comparison, SCA’s overall revenue was up by 2.3 per cent for the 2019 fiscal year, according to the company’s most recent annual report.
“The [podcast] market has matured to the point of being economically robust and growing exponentially,” Blackley said.
He said advertisers were after premium content that has a wide, on-demand reach. Kane Reiken, Nova’s digital commercial director, agreed.
“Podcasting has evolved so much,” he said. “It has become a real mainstay of the media habits of a lot of consumers.
“We [used to see] podcasting being spent as part of an innovation test-budget for campaigns. It is how people justified the investment. But now we’re seeing it as an integral part of their media mix. We’ve seen repeated spend from blue-chip brands who are addicted to the environment.”
A former radio executive, who did not wish to be named, said it was not uncommon these days for a successful commercial podcast to make a six-figure profit.
10’s Have You Been Paying Attention & ABC’s The Weekly return
If you’ve been paying attention to the show’s promos, you’ll know it won’t be business as usual when 10’s news quiz show, Have You Been Paying Attention?, returns on May 4, reports The Age’s Karl Quinn.
“We realised about a month ago we weren’t going to be able to get an audience, or even five contestants, into a studio without breaking some sort of government regulation,” says Tom Gleisner, host of the show and, with his partners at Working Dog, one of its producers.
“We toyed with the notion of the five contestants being separated by perspex screens, but they would have looked like Sydney cab drivers, so we quickly moved on from that.”
Instead, they settled on a format that retains as much of the flavour of the show as possible, while also acknowledging that TV production in the age of COVID-19 is fundamentally different.
And the five panellists will, like many of us, be dialling into work from home.
Also returning this week is ABC’s The Weekly With Charlie Pickering.
Shorn of its live studio audience of about 200, the show – which will tape on Wednesday morning for broadcast that night – can’t help take on a different feel, says Chris Walker, executive producer with Pickering of the news-comedy program.
“Charlie is usually talking to two audiences at the same time, the one at home and the one in the studio. And comedians love having an audience, so that’s a big shift. But it’s also a bit of an opportunity. It means he’s talking to the audience at home more directly.”
That won’t be the only change wrought by COVID-19. It will be a pared-back set, says Walker, and there will be three cameras rather than the usual seven, and fewer production staff on the studio floor.
But unlike HYBPA?, The Weekly will still have regulars including Tom Gleeson, Luke McGregor and Judith Lucy in the studio. Despite what the promo for the show would suggest, the part of Lucy will not be played by a sock puppet. “Though I did consider it,” Walker jokes.
Broadcast partners Nine. Foxtel agree to NRL’s May 28 restart date
The NRL has reached an agreement with its broadcast partners to restart the season on May 28 after the governing body presented a take-it-or-leave-it proposal on Friday afternoon, reports The Sydney Morning Herald’s Michael Chammas.
A day after describing the NRL’s May resumption plan as “premature”, free-to-air broadcast partner Nine softened its stance and will now support the proposed date, avoiding a potential courtroom showdown. It is likely the season will run for about 17 weeks, plus four weeks of finals and an Origin series after a potential October 4 grand final, although that is yet to be confirmed.
Nine chief Hugh Marks spoke with Peter V’landys after the statement criticising the May restart date blindsided the ARLC chairman on Thursday night, and wrote to him again on Friday before the meeting. Marks’ tone was far more conciliatory than Nine’s recent public announcements.
The NRL perceived Nine’s comments as a negotiating tactic in discussions about a potential three-year extension.
Marks arrived 15 minutes early. Foxtel boss Patrick Delany, driving his silver Mercedes, turned up at 3pm sharp. Nine walked into the meeting wanting to play just another 13 rounds, enough for every team to face each other once. Fox, desperate for content to fill its sport-less sport channels, was happy for the competition to last 22 rounds with a grand final in November.
Compromise will be reached – NRL, Fox and Nine need each other
When Nine had its first crack at the NRL, via a withering statement that could only have been stronger if it had been typed with the caps lock depressed, it was doing Peter V’landys a favour, reports The Sydney Morning Herald’s Adrian Proszenko.
Not only did it give the ARLC chairman further ammunition to spear a chief executive he had fallen out with, it also gave him a mandate to slash costs at a “bloated head office” that had spiralled out of control.
given the parties need each other, a compromise will be reached. If the NRL indeed resumes on May 28, it will become the only major sporting code on show. This could lead to an even wider viewing audience, one that Nine couldn’t afford to ignore.
Fox, despite even greater financial stresses, also needs footy to return to stem the churn in its pay-television subscriptions. Its league channel continues to manufacture content, even counting down to game replays on weekends. Even though they have been brought to life with contemporary commentary – ‘you won’t want to miss the observations of Blocker or Braith!’ – it has been a tough sell.
Fox wanted the regular season to run for 22 rounds. Nine, not wanting the premiership to run into its cricket season, was keen for the teams to play just once. In the end, the parties will land somewhere in the middle
Cost of NRL season still the main issue for Nine, Foxtel
The NRL has its 2020 season restart date, but how much Nine and Foxtel will pay for a revised season remains the core unresolved issue between rugby league administrators and their broadcast partners, reports The AFR’s Max Mason.
Both Nine and Foxtel are believed to be pushing for cost cuts in the tens of millions for the 2020 broadcast agreement, arguing that a shorter season, with potentially no crowds – due to restrictions on public gatherings – mean they should pay less.
More than half of the league’s revenue comes from its broadcast deal. The NRL, Nine and Foxtel declined to comment.
Seven West Media plays hardball on $350m sports rights bill
Kerry Stokes’s Seven West Media is applying the blowtorch to bosses of Australian cricket and the Olympics in the wake of the coronavirus, as the network looks to slash the $350m it had earmarked to spend on sports rights this year, reports The Australian’s Nick Tabakoff.
Seven insiders have told The Australian’s Media Diary there is now a “big question” in terms of Seven’s rights to the cricket, with network chiefs looking at “all of our options” in relation to cricket and the Olympics.
Before the pandemic, Seven had the biggest amount earmarked for sport of any free-to-air network this year, with $100m pencilled in for the Tokyo Olympics, $100m a year for AFL and $80m for cricket.
But once production costs were included, the total costs would have been even higher: $130m for both the Olympics and the AFL, and $100m for cricket.
Network 10 slams RA board over Castle exit as Optus delays talks
Rugby Australia’s TV travails look set to continue after free-to-air broadcaster 10 vented its fury over the board’s treatment of Raelene Castle and broadcast suitor Optus signalled it would not come back to the negotiating table this year, report The Sydney Morning Herald’s Georgina Robinson and Zoe Samios.
Three days after Castle’s sudden exit, the organisation was in flux. Interim executive chairman Paul McLean was set to meet with dissident Wallabies captain Nick Farr-Jones on Monday, but had apparently ignored a Friday text message from outgoing 10 boss Paul Anderson, who wanted to check in with McLean on the circumstances surrounding Castle’s departure.
McLean had spoken with Anderson’s successor, Beverley McGarvey, on a conference call with RA’s corporate partners on Friday afternoon.
But Anderson, who had a good relationship with Castle, told the Herald he was dismayed by the board’s handling of last week’s messy events and frustrated the game’s longstanding free-to-air broadcast partner had not been kept in the loop on the board’s thinking about its corporate leadership.