Opinion | Features
- In this guest post ZenithOptimedia boss Ian Perrin argues Foxtel's recent move to halve its basic package prices is not just to defend it from the threat of new streaming services. There has been much made of the substantial reductions in Foxtel pricing announced recently. It appears that most of the sentiment suggests that this is a defensive move, designed to take on the multiple streaming services ready to hit our shores. This may well be the case, but my belief is that it's the opposite. It’s actually a bold, offensive play designed to actively target the free-to-air networks. [caption id="attachment_249441" align="alignright" width="234"] Click to enlarge[/caption] Foxtel is smart enough to realise that hiding brilliant content behind paywalls and expecting people to pay exorbitant fees for it these days is suicide. The less accessible their delivery, the more likely consumers are to pirate it. And we all know that Australia has one of the highest rates of illegal downloading in the world, which the NBN will only exaggerate. They are also smart enough to know that the business model of content broadcasting is rapidly changing. What started off as a model designed to deliver mass content that appealed to everyone has moved towards delivering niche content to targetable segments. The next iteration is personalised content in an on-demand fashion. In this addressable world, advertisers are increasingly expecting to not only reach their audiences, but not pay for those who aren't. In fact they will set their own prices, sometimes higher, for the right impression. Trading desks have revolutionised how we think about personalised targeting, and while currently confined to the digital world, TV has to be, and will be next. To do this you need customer data, and right now subscription TV is the only broadcaster who has access to it. Free-to-air networks are hoping the launch of HbbTV will change this, but it's a large expectation. YouTube rightly argues that it already has more data than either party, but until it delivers high-end content to Australian TVs, they won't be able to match Foxtel. Hence why the Foxtel/MCN deal with Quantium is a further step in the right direction. So the space race has certainly begun. Foxtel is in a unique position of strength, but it may not last long. Its first step is a positive one, but it has to move quickly to deliver advertisers more personalised solutions using its data. While they understand this, there is still work to be done on execution. I have been a Foxtel subscriber for 13 years now, and yet I am still served retail banners asking me to sign up. Ironically, this is the sort of wasteful advertising that it is uniquely positioning to eradicate. Ian Perrin is CEO of ZenithOptimedia Disclaimer: ZenithOptimedia held the Foxtel media account until 2012
- Ahead of a session at tomorrow's Publish conference on whether native advertising will be the saviour of publishing Newsmodo founder Rakhal Ebeli sets out where how he sees the relationship between brands and editorial playing out.. There are so many question marks hanging over the future of the industry. Will print be extinct? Will journalists be endangered? Will publishers have evolved into a new, unrecognisable species? Here's how I see it developing. Brands and journalists will be enemies no longer Adaptation is crucial to the survival of a species. If we are to survive in our increasingly hostile environs, characterised by mass staff layoffs, cultural apathy and reduced press freedom, brands and journalists will need to make peace. This is already happening. Newsmodo for one has embraced the change with our global network of journalists delivering high-quality brand journalism for a range of blue-chip clients. But there is room for growth. While we have progressed to a new publishing paradigm, many journalists still have a lingering distaste for branded content. This attitudinal roadblock will be of no use in the future. Brand journalism proves that there are many mutual benefits to working together. As more journalists discard ye olde worldly suspicion of commercial interest, I predict there will be a publishing renaissance. The end of the archaic battle for editorial control will liberate writers, brands and publishers to explore new ways to provide interesting, newsworthy and relevant content for their readers. This could take the form of brand-sponsored documentaries, interactive custom publishing or flexi-collaborative content production. In short, it could be the start of a new neon-bright future for publishing. The fourth wall will dissolve The invisible fourth wall that divides ‘us’ the producer from ‘you’ the consumer will collapse. This will transform how we communicate, pushing the industry to move from a hierarchical to a lateral structure. The effect of this will be profound. It will lead to an even greater rise in user-generated content. This trend has already prompted brands and marketers rush to crafting new strategies that better reach their target market. I expect this will only grow and prompt further interest in tailor-made, targeted content. Since founding Newsmodo in 2013, I have seen a dramatic rise in the demand for personalised content. As we move into the future, and need to speak – quickly, conversationally and directly – with an audience becomes even greater, I forecast that demand for customised content will reach unprecedented levels. This could inspire radically new ways of connecting with audiences. Engaged in dialogue and not in diatribe, brands and marketers will have the opportunity to build real relationships and create more meaningful content experiences. Move to modularity In Future Shock, Alvin Toffler predicted the rise of the modular society. His discussion of a modular family unit and a more general social shift is also applicable to the publishing industry. In the future, publishing is likely to become (more) modular. Outsourcing and specialising will compartmentalise the industry into more efficient, less cumbersome parts. Online will be the new in-house. This will encourage a more global and diverse response to publishing. Audiences will also develop more modular readership habits. Today, apps and online tools like Storify, Medium, Stumble Upon allow readers to manage their news feeds and break down their content into small, compact parcels. As categories, tags, hashtags and filters become part of the new online lexicon, it will be increasingly important to develop content that cuts-through. And what will cut-through? Quality. History has taught me that quality is timeless. Looking forward, I predict that quality content will continue to be the publishing industry’s most valuable commodity. Rakhal Ebeli is the founder of Newsmodo
- With Click Frenzy kicking off tonight and amid warnings over the state of Australian e-commerce Mark Troselj says there are some simple things local businesses can do to beat international pure-plays like Amazon at their own game. Warnings by GroupM’s digital boss last week that Amazon has the potential to crush Australia’s e-commerce market “like an Anaconda” should not be written off as hyperbole. Too many Australian businesses have been slow to grasp the enormity of the wholesale transformation of the global retail sector and have procrastinated at the expense of market share and current and future revenue streams. Alarmingly a recent Frost and Sullivan report ‘Disrupt, Collapse, Transform,’ revealed that although digitalisation, new disruptive competitors and new business models are driving change, only 38 per cent of Australian retailers have the ability to transact online. You read that correctly. In a world where yesterday’s consumers are rapidly being replaced by tech-savvy web and mobile users who now expect to research, price-shop and buy without picking up a phone or going in-store this, 62 per cent of Australian’s are effectively ruling themselves out of the game. With Nielsen recently reporting that six out of ten Australian’s taking a multi-channel pathway to purchase (according to Nielsen’s “Australian Online Landscape Review’) and US retail juggernauts on the way, which seems like retail suicide. But crucially, it is entirely avoidable. Because, whilst Amazon has written and re-written the rules of ecommerce globally since the late 1990s, and will no doubt continue to do so, Australian retailers large and small now have access to resources and technology that can be quickly implemented to get them back in the game. Better yet, that technology is invariably in the cloud which means lower capital expenditures, faster results, real-time data and the ability to instantly scale. Local online retailers have the real opportunity to exploit local brand awareness and leverage their physical stores to reduce shipping costs, improve delivery time and cut inventory carrying costs, with the potential to beat Amazon at its own game. Then they can use their brick-and-mortar stores to create advantages Amazon can't match – particularly pertinent given the rise of the multi-channel path to purchase and as retailers are beginning to experiment with iBeacon technology, not to mention the potential of the next wave of wearable/Internet of Thing devices and applications. How to escape the Anaconda’s grip First and foremost, Australian retailers need to choose the right commerce software platform to drive their ecommerce operations and manage its integration into their bricks and mortar presence if they have one and as well their financials, shipping, order management, inventory, supply chain and warehouse. It needs to have real-time inventory updates, customer self-service, one-click reordering, easy search functionality and the ability to promote products dynamically. This will invariably be found with a cloud-based commerce management solution irrespective of whether it is a small online retailer or large multinational. Superior shipping and fulfilment is also fundamental. Ship to your customers faster and they will be delighted. Ship to them more cheaply and profit will go up. Accomplish both goals by shipping from the location nearest your customer, whether that is a warehouse, distribution centre or brick-and-mortar storefront, and you’ll cross fewer kilometres with each shipment realising both reduced shipping costs and improved delivery times. You can also turn a store into an asset by offering purchase online and pick up in –store, shop to home but exchange in-store. Ever cognisant of the changing e-commerce landscape, Australia Post recently launched its new 24/7 parcel lockers in key urban areas to make the shipping and collection process far more convenient for both retailers and consumers. A new major advertising campaign launched by GPY&R Melbourne is expected to help drive purchasing from busy professionals who don’t have time to collect parcels during office hours (indeed we recently partnered with Australia Post to help our online retail clients transform delivery and collection processes). As customers demand a smooth and personalised journey to purchase, it is imperative to nail marketing insights and strategies. It’s true that Amazon wrote the book on this, but there is no reason that the ‘smaller guys’ can’t do just as well. The tools are out there to enable businesses of any size to precisely identify, segment and target consumers in granular detail, without requiring an army of analysts or a resident actuary genius to decipher. Loyalty programmes, targeted discounts and personalised EDMs are all simply executed at the push of a button. We have seen countless Australian businesses transform their operations, and ultimately their profits, by changing their fundamental business platform and moving away from the disparate business systems of the past. Just as the silos of advertising and marketing are merging into true cross-channel and platform campaigns, so are the business processes that underpin them. Customers increasingly expect a seamless and consistent omnichannel retail shopping experience, regardless of whether they shop in-store, online, or telephone and catalogue across any mobile device. Despite Amazon’s global domination, businesses don’t have time for the luxury of fear – they must begin to transform. The good news is that there are many strategies and solutions that Australian retailers can adopt to remain viable and beat Amazon and other major B2C e-commerce companies at their own game. Mark Troselj is managing director of Asia Pacific and Japan for NetSuite
- Recently undergraduate Jacob Hkeik penned an opinion piece about a lack of awareness of media agency careers amongst students looking for careers. Here Linda Wong from the Media Federation Australia responds. Two weeks ago we read an article by MGrad graduate Jacob Hkeik, saying media offers some of the most interesting career opportunities to graduates, but most of them don’t know media agencies exist. The fact is, the MFA and our members put a lot of work in to educating lecturers and students about the opportunities in our industry and our most recent survey shows that in actual fact, more than 60 per cent of new recruits to the industry came from MFA-accredited universities. Sure, this new talent may have predominantly come from communications faculties, but the fact is, these are the lecturers and students that are most engaged by the opportunities media has to offer. As the data and programmatic trading space continues to build, it’s important to get a foot in the door in the Finance, Pure Mathematics and Business faculties, but much like this is an education process for our industry, on the changing nature of roles and opportunities that exist – so too is our challenge at the university level. While the Advertising Media Agency Industry feels huge in size and scope when you are working in the heart of it, in actual fact it’s fairly small. According to the MFA’s Annual Census Survey, we’re talking approximately 3,000 people. There are 813,689 domestic students attending universities in Australia, and we only have openings in our industry for 245 graduates each year. With that in mind, over the last five years our strategy has been to get ‘on the ground’ involvement with the Communications and Marketing faculties and making sure their courses are relevant and cover what we do in the industry. We also engage them through our annual “Lecture the Lecturer” sessions, where course leaders at all the key unis are updated by industry leaders on trends, changes, grad programs and new opportunities. Plus we have over 200 students visit us annually for student visits, and we do at least 2-3 Guest Lectures at each of the universities. 60 Experts from our industry have contributed to creating awareness of our industry with the universities this year alone. Over the past four years our MFA intern program has placed 140 interns with member agencies, resulting in 90-95 per cent of interns being offered full time employment at the end of their placement. Plus, our member agencies run their own scholarship programs with students, such as MGrad with Group M, TMS, OMD, PHD and UM. Is there more to be done to educate students about what we do, and the many benefits of joining our industry? Without a doubt. We would love to connect with the other 800,000 students, particularly those with data, business, finance, psychology and education backgrounds. As they are difficult to reach en-masse, we are working towards more targeted programs. For now, we’re pleased with the progress we are making. Linda Wong is MFA director, people
- During the Hector Crawford Memorial Lecture at the Screen Forever conference, writer, broadcaster and film maker Phillip Adams called for a repeat of the Government largesse of the 1970s and for the "cultural and political idealism" of the Whitlam administration to save Australia's film industry. Read his full address here. Hector Crawford. Named for the Trojan prince. Presumably his parents also considered other classical heroes – Rome’s Horatio, the Carthaginian Hannibal or Hercules, son of Zeus. On balance I think Hercules might have been a better fit given Hector’s herculean efforts to get local drama onto Australian television. I first met Hector in the mid-fifties, hours before television was introduced to this country and years after the Americans and British had managed to crush what was left of an Australian film industry through their ownership of Hoyts and Greater Union. My focus would be on film – not on a film industry as such – but on the feature film as a focus for national aspirations. Working with my partner in cultural crime Barry Jones, our inspiration was more the films of Sweden and the courage of filmmakers in Hungary, Poland and Czechoslovakia. And the arguments we would put to John Gorton were unashamedly patriotic, nationalistic and, let it be said, anti-American. Around a hundred and fifty million people died in wars and genocides in the 20 century. Had the Third World War not been narrowly avoided that figure might have increased tenfold. Nationalism and patriotism, exacerbated by newly minted ideologies, racism and old religions, created the greatest charnel house in history. Statisticians will tell you, despite what seems to be evidence to the contrary, that these early stages of the 21 century are a period of comparative calm. At least according to the body count. But as we stumble and fumble about in its early stages notions of nationalism and patriotism still represent a far greater danger to human sanity and survival than the current pandemics of HIV and Ebola. Yet, today, I am going to urge you to be patriots and nationalists. Because despite the blurring of borders created by corporate globalization and recent technological wizardries, it is only old-fashioned nationalism that can inculcate public and political support for an Australian film industry. I will suggest to you that your future survival must be predicated on the appeals that Barry and I used inthe past. The secret for the survival of an Australian industry begins and ends with that all-powerful word. Australia. Despite my ambivalence about patriotism I’ve been in the tub-thumping business for 60 of my 75 years. I’m now the oldest pundit in the employ of The Australian newspaper. One of the oldest broadcasters at the Australian Broadcasting Commission. I’ve headed the National Australia Day Council, chosen Australians of the Year, persuaded Qantas to write The Spirit of Australia on their umpteen aircraft. I set up Advance Australia, an outfit to cajole Australians into buying Australian. Yet in the same breath, when I hear Abbott talk Team Australia I feel like joining Barry McKenzie in projectile vomiting. Because you’d need a tin ear not to recognise that Team Australia is code for a Whiter Australia, a more Christian Australia. The film industry exists because government called it into being, persuaded by patriotic arguments. Lose the support of the Australian government and this whole enterprise vanishes, like picnickers at Hanging Rock, and we revert to the cinematic terra nullius of the 1950s and 60s. Film, for most of its 100-year history, has been the most political form of expression. When Barry and I arrived in Moscow, whilst circumnavigating the planet on a mission from Gorton, we learnt that Lenin, having recognised the potential of the medium, had within minutes of the Bolshevik revolution created the VGIK, the film school in Moscow. Hitler? The triumph of his will required the films of Leni Riefenstahl. And as I used to write in the 60s MGM was every bit as important to the USA as the CIA – the ‘dream factory’ of Hollywood producing the ‘soft power’ that would mould the imaginations of pretty much the entire human population. Around the world people would drag the Trojan Horse of American films into their cinemas – and with the arrival of television, into their homes. More than any other pop cultural factor, it was cinema that persuaded us to mimic America in everything from food to fashion to foreign policy. American soft power, overwhelmingly spearheaded by movies, would aid and abet the American program leading to political, financial and even military dominance. And while Stalin was controlling and censoring Soviet cinema Washington was doing pretty much the same in Hollywood through the Hayes office and later the efforts of HUAC and McCarthy. To make sure that US films served the political purposes of Team America. Authoritarian governments and their democratic counterparts always knew that film was a two-edged sword. Hence the mayhem of the McCarthy years, hence the decision of South Africa’s apartheid government to delay the introduction of television for decades. God forbid that black Africa should see western television when every other program provided evidence of comparatively successful integration of white and black. Even in amiable England film was employed as the most powerful propaganda tool – keeping up the British pecker during the Blitz. Within moments of his abdication the Duke of Windsor was cutting secret deals with Hitler to be plonked back on the throne following a Nazi takeover. And a great many of the most influential member of the British aristocracy were similarly inclined. Yet the British working class felt very differently – and one of the reasons they gave wholehearted support to a beleaguered Winston Churchill was, yes, patriotic films by the likes of Noel Coward. Meanwhile, here, we’d allowed the British and the Americans to crush our own industry. When it came to cinema – and this situation would extend well into the first decades of television – we were effectively censored. We gave new meaning to the term silent film because we had no film. And you can’t be more silent than that. It has long amused and frustrated me that we focus our energies and identities on anachronistic associations with Britain – a Britain reduced from imperial magnificence to an enfeebled Commonwealth with a monarchy little more than a theme park of increasingly creaky and rheumatic rides. The real issue is not with a redundant monarchy but with a powerful republic. And I’m one republican who wants to see our humiliating and groveling relationship with the United States our focus. Forget the Windsors. Worry about Washington. Film projectors project so much more than film. They project ideas and ultimately belief systems. Ours is a country with comparatively sane gun laws. We do not drown in mass-marketed religiosity. Nor do we see the theory of evolution as blasphemy. Women here have the right to choose. Thanks to a campaign energized by Barry Jones we have long since abandoned the death penalty – whilst the US – most notably Texas – maintains an assembly line to deliver victims of a racist legal system to the execution chamber. In so many ways Australia wasand remains light years ahead of the US in its social attitudes. Yet we allow ourselves to acquiesce to insane American laws regarding drugs and we have increasingly echoed their law and order rhetoric and legislation. Anybody who doubts for a moment that US film and television hasn’t placed a crucial role in this dangerous osmosis simply hasn’t been paying attention. We’ve increasingly embraced the US political system, turning our federal elections into de facto presidential elections – a process that I was writing about in the age of Robert Gordon Menzies. And we’ve increasingly allowed our elections to become auctions – competitions between advertising agencies as much as betwixt candidates and policy. I met with Joan Ganz Cooney when she was launching Sesame Street in New York and remember her compelling observation that Australians absorb American popular culture as if we were made of blotting paper. And that ends up with us joining the US in its inane, insane and often entirely counter-productive wars. The war in Vietnam, the war in Afghanistan, the wars in Iraq, the wars on drugs and the war on terror. Farces, fiascos and frauds. Let the record show that my life, like yours, has been measured to a large extent with magnificent American films and plays and novels. I believe that the United States sets the highest standards in almost every example of human activity – and the most awful examples. But Hector Crawford and I (and Barry) were united in our belief that we needed a buffer zone to allow Australian ideas and ideals to breathe. Through the 60s there was no support for an Australian film industry. Indeed, it would be actively opposed by such early license holders as Sir Frank Packer – and just as tenaciously and more surprisingly by the ABC which did everything ‘in house’. Outsiders need not apply. As I’d complain at the National Press Club that was tantamount to the National Gallery of Australia hanging only portraits and landscapes by staff painters, artists who work 9 to 5 with holiday pay and superannuation. Imagine the outcry at such a proposition. Yet it suited the ABC just fine. So they were, in an unholy alliance with Packer, doing everything they could to discourage government support. Nor was there any audience support. How could there be? Since the 1930s there’d been a handful of Australian films and virtually nobody had seen them. Throughout the 60s and the early 70s the Americans dominated TV scheduling and took home 96% of the Australian box office. Leaving 4% for the rest of the world. For the filmmakers, for the UK, France, Germany, Russia, China, India, Eastern Europe – and Australia. It wasn’t just the Australian film and television industry that was in the doldrums. In the 60s only 4 Australian plays were professionally produced, 4 in a decade. Generations of Australian actors had lived and died without ever playing an Australian unless you managed to get into the cast of Blue Hill or one of Hector’s pioneering radio serials. Our actors were vocal chameleons who could do Noel Coward, Shakespeare or the toffee voices required for the English drawing room comedies imported by J C Williamson. They could make a fist of Arthur Miller, Tennessee Williams. But the first thing an Australian actor learnt to do was to get rid of his or her embarrassing Australian accent. There’d been continuous agitation through the 60s for governments to do something, anything, to encourage local film and program makers. But nothing happened, except for one odd law that was passed under mysterious circumstances. It was against the law to run a foreignmade television commercial here. Thus the great global brands like Coco Cola and Marlborough had to make commercials locally. They were often frame for frame copies of US originals. And there was the phenomenon of so-called ‘ghost crews’ – where Australians would go to Los Angeles and pretend to have shot a Coca Cola or Marlborough ad. They’d luxuriate in a hotel for a few days, sign a few forms and fly home – with 100% American ads in their luggage. Nonetheless this law built up a skill base, particularly with our technicians – the cinematographers who’d later queue up to collect their Oscars – and with would-be feature directors like Ray Lawrence and Fred Schepisi. Many of the most significant names in our film industry learnt the tricks of the trade making ads – and it was much the same in the UK where David Puttnam and friends like Ridley Scott would make the move from TV commercials to fully-fledged features. But the big breakthrough came when Barry and I returned from our circumnavigation of the planet and I wrote the most influential page of prose of my life. And I want to remind you about it – because it is my belief that the only way forward for our troubled industry is to retrace those steps and make the same arguments loud and clear My page began with a piece of nudge nudge wink wink plagiarism – the opening statement of America’s Declaration of Independence. ‘We hold these truths to be self evident.’ Yes, it was a joke. But my page was also a declaration of independence. ‘We hold these truths to be self-evident. It is time to see our own landscapes, hear our own voices and dream our own dreams.’ Australian filmgoers had rarely seen their own landscapes on a Hoyts or Greater Union screen. They were much more familiar with the American accents than their own. And when it came to dreams? We knew next to nothing of our own history. Our ignorance of Aboriginal Australia was utter – whereas we knew a great deal about the so-called Red Indians. And when it came to dreaming dreams? Even our heroes were fully imported from the US. Australian fathers were effectively emasculated in the eyes of their kids because they were not Americans. Hence Barry and I made three recommendations. First, the so-called Experimental Film Fund. The idea was to give money away, in tiny amounts, to anyone who wanted to have a crack at making a short film. I had recently made my first feature on a clockwork 16mm Bolex, for just $6,000. Called Jack and Jill A Postscript it went on to be the first Australian feature to win the AFI awards and the first Australian feature to win the Grand Prix at an international festival. (Yes, a very small international festival – Adelaide-Auckland.) But if I could make a feature for $6,000 then for $600 you could at least demonstrate potential talent. The experimental film fund. Its greatest significance was that it was the first commitment of federal funds into the film industry in living memory. Gorton approved it without even discussing it in Cabinet. Its purpose was to scatter bread upon the water. The best and brightest would emerge and – here’s the second recommendation – we’d send them to a shiny bright new film school. I wanted to base the school on Swinburne’s pioneering effort in Melbourne – but this was the one recommendation that Gorton would dismiss. John wanted it in Sydney – imagining a mega- campus which might accommodate all cultural institutions with ‘Australian’ in their title. The Australian Ballet, the Australian Opera, the National Institute of Dramatic Art. That certainly wasn’t Barry’s view or mine. We’d noticed that the best film schools were often shambolic little outfits often located in the grottiest part of a city, amidst the rough and tumble of street life. Film schools were, at the time, immensely popular. The film school movement in the US was about to produce the likes of Spielberg and Francis Ford Coppola. All the filmmakers of the Soviet and Eastern Europe were film school graduates. And in the UK plans for film schools were afoot. But wherever the film school would be built would lead to our third recommendations. The graduates from our film school, who would form themselves into teams, would then be funded – fully funded if necessary – by a Film Bank. The Australian Film Development Commission. Soon thereafter John lost office, with only the experimental fund in place. It would take 2 more prime ministers before the second and third steps were implemented. Billy McMahon was a waste of space but Whitlam pushed ahead. In the 60s we learnt quite a bit about how to handle governments from, of all people, André Malraux – a very famous French novelist who was Charles de Gaulle’s Minister for the Arts. When Malraux wanted to influence de Gaulle on film policy he’d round up the good and the great of French cinema – the living national treasures like Jacques Tati and Bresson – and the great actors. Because he knew something that all of us know about Australian politicians. Or American presidents. They love being seen in the company of the acknowledged national treasures. But he also said this. Make sure that the President is the Minister for Film. Don’t have junior ministers, if you have a junior minister you won’t get the money out of Treasury and the idiots will interfere. We took that advice very seriously and always battled to keep film in the Prime Minister’s department or the Premier’s department. And as long as that lasted with Gorton, with Whitlam, with Dunstan, with Wran, things went pretty well. But as soon as you were downgraded, Malraux’s warnings came true. We started to lose our momentum when junior ministers, particularly political nonentities, were given responsibility for film. That three-step program worked like a charm. The pent-up creative energy in this country boiled over and within minutes we were a significant filmmaking nation. We famously became flavoor of the month, of the year,of the decade as we started winning prizes at major international film festivals, not simply Adelaide Auckland. At about the same time Don Dunstan called me. As a shiny bright new Premier he’d feltthe pulse quickening and wanted to be a part of the Australian film renaissance. So I devised the South Australian Film Corporation which was immediately followed by similar organisations in Victoria, QLD, NSW and even Tasmania. With the passing of the years a few of them failed. But from having been the hardest country on earth in which to make a feature film Australia became the easiest. But the Americans were not happy. Again and again they set out to destroy us. And it is important that you know how bitter these fights were. The TV channels were forming themselves into networks and telling Hector Crawford and the Government that they couldn’t afford Australian drama. And that was almost true. Why? Because they were spending far, far too much on American programming – paying the highest price in the world for US shows. Not simply in per capita terms. Every year the buyers for the networks would go to the US and bid up the prices. Whitlam agreed to an enquiry into film and television – conducted by Richard Boyer. I kept my evidence for the last day proposing that Australia should have a buying agency – send one person, just one, to the US with a shopping list provided by the networks. He would refuse to pay the inflated prices and, yes, the studio super profits would be eroded. But they’d have to cop it. Then, back in Australia, we’d hold that auction. The networks would bid on the programs they wanted – and the difference between the price we’d paid in the US and the price the networks paid here would be used to fund Australian television drama. With all due modesty the Adams plan was simple and elegant. It was, however, leaked to Hollywood by a recalcitrant member of the Whitlam government – a Minister who enjoyed overly warm relations with the US studios. And Jack Valenti, the head of the all-powerful MPAA (the Motion Picture Association of America – a lobby group which I compare to the National Rifle Association in its ability to influence Washington) immediately hopped on a plane. Not to Australia. To Honolulu. Valenti had been the bag man for Lyndon Johnson and front man for Hubert Humphrey. He was Democrat Party aristocracy – and had been given the MPAA job as a sinecure. And he was bloody good at it. Honolulu? Gough was on his way back from a victory lap as prime minister. And Valenti who was 5ft tall baled him up in the VIP lounge and said, ‘If the Adams plan is implemented you will never again see an American film or television show. We will slap a total embargo on you.’ His threat was ludicrous. Not even Valenti could have brought it off. Or maintained it. We’re talking the Easy Rider era when independent production was exploding and the studios were beginning to retreat. But Gough was understandably alarmed and when he returned to Australia told me of the threat. I said, ‘But that would be terrific, it would make Australians angry about the Americans and give us what we’ve always lacked – support of Australian public opinion to back local films.’ But for once in his life, Gough chickened out. There was a quick Cabinet meeting and they waved the white flag.I tell this story to show how brutal things can get. In the years ahead I’d often negotiate with Valenti on Australia’s behalf. There was no more talk of total embargoes but from time to time Jack would murmur that other Australian exports such as lamb might be rejected. This would happen incidentally when the New Zealanders dared to refuse entry to US nuclear ships into their harbours. Whether it was the soft power of thatTrojan horse of film and television or the hard power of war ships, the US protects its interests. Of course, Australians were more than welcome to become a part of the American film industry. They were perfectly happy for us to be a backlot for their films provided we greased the palms of their producers with tax breaks and bribes. Nor do they mind if an Australian director make a hybrid film like Gatsby. What they can’t destroy with a big stick they try with the carrot. Once the Trojan Horse of American film was inside our cinemas, once its foal was dragged into our homes via television, the Americans were able to use their cultural clout to tell us what to eat, what to wear and what to think – even changing our vernacular. Our best and brightest joined their industry at the cost of the cultural impoverishment of ours. The reason Australians won support in the late 60s and early 70s was because we argued the Australian case. To see our own landscapes, hear our own voices, tell our own history, celebrate our own heroes. That and that alone gave us political leverage. It was never an argument about employment levels. It was never an argument about an industry as such – and support for industries, these days, don’t go down too well. Ask far more significant operations like the auto industry. If Canberra will cop the political pain and close them down they’re hardly likely to lose much sleep over the complaints of local film producers. If you are to win ongoing support from government – and it matters little what brand of government you’re dealing with these days – the only weapon you have has Australia written on the blade. It is still the most powerful word, whether used as noun or adjective. It’s what saves the Australian Broadcasting Commission from the constant assaults of the Australian newspaper. It is what draws attention and funding to Australian Opera, Australian Ballet and pretty much anything else with Australia in its name. It is time to wheel out the big guns in Australian culture – not only from the first rank of Australian filmmakers and actors but also from Australian literature. We are still reeling in delight from the fact that another Australian has won the Man Booker prize – my friend Richard Flanagan now joins the ranks of Carey and Keneally. Activate them. All three have passionate commitments to Australian film. Alert the Australian painters as well. In fact, we’ve got much to learn from the painters and the writers who’ve been more successful than the filmmakers in achieving local market share. Whilst 95% of the box office still goes to American films Australians overwhelmingly prefer to buy Australian paintings – and the list of bestselling books in this country invariably have a few Australian novels on them. I walked away from any involvement in film 10 or 15 years ago. I closed down my production houses, resigned from my committees and have avoided commenting on film politics since then. I was dragged reluctantly to this lectern. But in my heyday I was remarkably successful in getting money out of state and federal governments. And the techniques that Barry and I employed then have urgent relevance now. I used to joke that Australia only rhymed with failure – which isn’t much help if you’re trying to write a national anthem to compare with ‘the Marseillaise’. Even our unofficial anthem, ‘Waltzing Mathilda’, is a woeful ditty. Though it claims to tell the story of a jolly swagman it ends with the poor bloke drowning himself in a billabong over, of all things, a sheep. And failure resonates in so many of our early films. In Peterson Jack Thompson wants to succeed at university but finishes up repairing TV sets. In Sunday Too Far Away, Jack fails in his ambition to be gun shearer. In Gallipoli we finish up losing the war. Phar Lap dies, probably murdered. In Peter Weir’s early feature The Cars That Ate Paris there’s a dying cadence and in Picnic At Hanging Rock, which Barry Humphries once called The Cars That Ate Children, Miranda and her mates are never found again. Whilst Alvin Purple runs in the opposite direction from sexual encounters, Barry Humphries runs towards them but remains a virgin. The Getting of Wisdom’s title was ironic. In Don’s Party we lose the election. I remember a French audience at Cannes, who’d spent the first hour thoroughly enjoying Burke and Wills, flouncing out enraged when they realised the explorers are going to die in the desert. Let us hope the Australian film industry does not end, once more, in failure. But if it is to have a happy ending its advocates musn’t be fooled into collaborating with the bureaucracies by arguing in their terms. It is time to form another Team Australia. Based not on dog whistle calls to bigotry but on expressing the sort of cultural and political idealism that was so exhilarating in the glory days of Whitlam. It is time to call upon the pantheon of Australia’s creative producers, filmmakers, writers, painters, pundits, public intellectuals and sympathetic pollies – anyone and everyone who can be recruited to the cause. I hold this truth to be self-evident. Our film industry was created with government largesse in the early 1970s. And I’m sure that Hector Crawford would agree with me when I state the bleeding obvious and say it cannot live without it.
- Network Ten's director of corporate and public communications Neil Shoebridge has penned a letter to the editor in response to an opinion piece by Alex Hayes on Friday on Ten's upfront presentation the previous evening.
The column you posted on November 14 described Network Ten’s 2015 programming slate as “frugal”, “lean” and “minimalist”. That description is inaccurate, misleading and puzzling.
At our Upfronts 2015 presentation on November 3, we laid out a full 12-month schedule, including eight new local productions:
- I’m A Celebrity… Get Me Out Of Here!
- Shark Tank
- The Bachelorette Australia
- Mary: The Making Of A Princess
- The Peter Brock Story
- The First ANZACs
- Baby Circle
- The frugal programming slate unveiled by Ten last night is that of a network ready for an injection of cash and programming from new owners, writes Alex Hayes. There's a saying that necessity is the mother of all invention, and Network Ten certainly got inventive at its upfronts last night. [caption id="attachment_262721" align="alignright" width="234"] Ten's priorities for 2015[/caption] Firstly to Ten credit where it's due - they got the tone of the big bash at The Star in Sydney bang on. Humble was not far from the lips of most media buyers I spoke to, although there was a hint of desperation in the voice of sales boss Louise Barrett when she said during her presentation there was no need to "excessively compensate the opposition". There was none of the bombast you see from their free-to-air rivals. But let's be honest, Ten doesn't have a lot to brag about at the moment. The troubles of the third-placed free-to-air network are well documented, and deep. Whilst ratings are slowly clawing their way back (anyone present will not have failed to notice Ten is the "only network to grow in 25-54s" this year) it'll still be a while before there's enough consistency for media agencies to, as CEO Hamish McLennan put it, make sure their revenue shares match their audience shares. [caption id="attachment_262714" align="alignright" width="234"] Louise Barrett talked up Twitter engagement[/caption] That might be why they got fairly inventive with some of the 'metrics' they were trotting out, including trending on social media, which I wasn't aware was a tradable metric for media agencies. That's probably a bit glib, and indeed Ten was the "number one platform in July for social TV" (when its biggest show of the year Masterchef was ending), with Barrett mentioning the Nielsen Twitter TV metrics tie up to stand up its claims. Notably though there was no mention of the efficacy of the social media campaign which accompanied the underwhelming drama Party Tricks recently. But with little else solid to talk about (The Winter Olympics didn't get a mention) Ten was forced to point to the performance of catch-up service TenPlay (the fastest growing), and some promises around HbbTV enabling people to purchase items being used in shows. Attractive, but not exactly ground breaking. It was also interesting to note the personnel in the room. There were a handful of media agency CEOs from Sydney, Melbourne and Perth, but far more of the operational 'dots and spots' bods who actually allocate the cash, and may be more susceptible to the sales pitch. So what was said? Well, let's start with the programming. It's not a stretch to say almost everything ratings-wise next year for the network is pinned on reality format I'm a Celebrity...Get me Out of Here. Julia Morris as host is a very good get for a format that relies on some sparkling repartee to string together what can sometimes resemble the bleaker moments from Vietnam war films as half-starved and dazed people wonder round a jungle performing demeaning tasks for food and acceptance. Casting Bondi Vet Dr Chris Brown as her co-host is an interesting move, and time will tell if the duo can form a good on-air patter. That will launch in February straight off the back of the Big Bash League, and everyone at Ten will be hoping a pretty packed summer of limited overs cricket (with the World Cup starting in February and a lot of one-dayers for Australia on Nine) doesn't fatigue fans of the game. Ratings were pretty good last year, and some big-name signings on and off the paddock could help it achieve some bumper summer audiences. If that happens the network will have another of last night's buzz words, momentum. [caption id="attachment_262718" align="alignright" width="234"] Ten set out its programming slate[/caption] The programming slate after Celebrity looks pretty solid, but unspectacular, with Ten taking the pretty much unprecedented step of setting out when each of its big formats will air, with Shark Tank set to appear early in the year as well. The Bachelor getting a spin off 'event TV' mini-series in The Bachelorette (yes, the jilted Sam Frost is in the mix for it along with some of this year's unsuccessful contestants) will get plenty of chatter. The Biggest Loser is getting its Masterchef style makeover with the return of the families format, and programming boss Beverley McGarvey claimed last night there was something in the light entertainment bracket being prepared for the end of the year. The last time they said that it turned out to be Family Feud which has actually been a real boon for Ten, so they'll have their fingers crossed at being able to pull something like that off again. Other local bits and pieces included McGarvey admitting they were "working on how we move forward with a new season of Offspring", suggesting star Asher Keddie might be out of the picture, while Party Tricks didn't get a look in. Whilst that slate felt somewhat tried and tested, the line up of international programming was - surprising. [caption id="attachment_262702" align="alignright" width="234"] James van der Beek in his Dawson's Creek days[/caption] Let's put it this way, it's the first time since the late 90s I've heard the names James van der Beek (think Dawson from the Creek) and Matthew Perry (he'll always be Chandler to us) used with such excitement. It's not inappropriate to mention Perry is the star of a rehash of The Odd Couple. I'll say no more. In the end it all felt a little bit minimalist. And perhaps that's the point. Ten has very little cash to throw around, and if the persistent rumours of a takeover are true then it's not in its interests to have a lot of big-budget stuff in the bag. There were times last night when it felt a little bit like an investor presentation than an upfronts, like when they set out the route map for its shows. When the talent from Ten's shows was trotted out on stage it did feel a little like some form of cattle auction was about to kick off. There were execs from Foxtel in the room - programming boss Brian Walsh and marketing head Ed Smith were both present - as Rupert Murdoch was addressing the News Corp global AGM and telling activist shareholder Stephen Mayne the company is looking at a 14.9 per cent stake in Ten. But it won't be his son Lachlan's. That might well be acquired by rumoured joint-venture partners Discovery International. And the fact Ten has already partnered with Foxtel to produce a local version of UK smash Gogglebox (casting will be crucial for that one to live up to its potential) shows there is scope to cross-polinate shows on free-to-air networks from pay-TV. By having a very lean slate now the door is open to some of that pay-TV content that's out of reach of many at the moment to be trickled down (Think Wentworth - Ten is the spiritual home of Prisoner after all) and maybe entice a few more people to pay for that content sooner. https://www.youtube.com/watch?v=xW-If7_z1WQ Equally the network is not spending exorbitant amounts of cash on big budget dramas - making it more attractive to the would-be owners who already have a pretty parlous financial situation to deal with at Ten. And that also frees up more cash to go for those sought-after sports rights which are coming up in the next few months - the AFL. As with Seven there was no mention of a streaming play, but then that would also be nicely taken care of if Foxtel gets its stake with Presto being the solution. Ten might not have a lot of cash in the bank, but there is still a lot of good will in market for it. However, media buyers will expect to see a substantial uptick in the network's ratings pronto if they're going to be able to make the case to match revenues to audience share. By the looks of last night Ten is banking on an injection of cash and programming during 2015. Alex Hayes is editor of Mumbrella
- While many predict the official arrival of global streaming giant Netflix in Australia will damage local media players Kevin Dillon argues it might actually end up being a boon for the savvy ones. I first encountered the notion of online DVD rental between pints of Sierra Nevada at the Black Watch (a dive bar in Los Gatos, California). It was late 1999, and my friends and I were toasting my two years survival in Silicon Valley. Those were halcyon Internet bubble days in the Bay Area. Notable successes (Amazon) were emerging. Others (webvan) burned brightly but briefly. Most wouldn’t see the other side of the 2000 tech wreck.My friends were two of the few dozen employees at an early stage start-up just down the road. The online DVD rental service their company offered was hugely convenient and affordable, and I was a rapid convert. Movies and TV series that just could not be found on US TV leapt out of their ruby red envelopes and into my DVD player. The start-up, of course, was Netflix. And their pivot from DVD to streaming is the stuff of Internet legend. Today’s Netflix employs 2,000 people and has squirrelled away US$1.7 billion in cash. This year they will invest more than $600 million on marketing, $400 million on technology, and close to $3 billion on new content. Their total content spend runs at $8.9 billion. They have survived – and prospered – despite the tech wreck and several other major business challenges. The company is well led and chock-a-block with talent. The only red you will find there is in their branding! The Netflix story illustrates how scale is King. A deep content catalogue is just one aspect of their achieving scale. Operating for 17 years now, they have scaled their coverage across pretty much every available connected viewing platform. They have scaled the personalisation capabilities of their own platform, and their ability to extract valuable consumer insights from that platform is probably second-to-none. Over the last four years, Netflix has honed their new market entry and development practice, and their addressable market is scaling accordingly. Their international expansion started with Canada in September 2010. Since then they have launched in the Caribbean, Mexico, Central America, South America, United Kingdom, Ireland, Norway, Denmark, Sweden, Finland, The Netherlands, Germany, Austria, Switzerland, France, Belgium and Luxembourg. They expect to exit 2014 with 57 million global customers. We know they have their eye on the Australian and New Zealand markets, and their launch here may be imminent. What might such a launch mean for the industry here in Australia? A neflix.com.au would: 1. Accelerate viewership evolution Assuming connected TV penetration and broadband speeds continue to improve, we’re likely to see increased bifurcation of viewing into two surprisingly complementary modes: • Conventional linear broadcast TV centred around an EPG grid of mass-appeal events (sport, news, reality and must-see series), sponsor-funded, and viewed predominately on large TV screens. • Non-linear Internet TV centred around personalised portals into a broad and deep catalogue of exclusive and non-exclusive movies and TV series, unlimited no-commitment monthly subscription-funded, and viewed on any broadband-connected screen. 2. Exert considerable competitive pressure on our domestic Internet TV subscription platforms Netflix will not launch here without a mostly intact content library augmented by some compelling local content. To effectively compete Presto, Stan etc. will need to find ways to gain the benefits of scale beyond Australia’s small domestic market. Can we expect to see closer tie-ups with HBO, Amazon Prime? 3. Ignite an aggressive marketing and pricing program As subscription Internet TV has very limited penetration here, some of this marketing effort will need to cultivate the sector itself. Netflix’ ability to price their service aggressively will be constrained by exchange rate movements. But their relative advantage in purchasing services like CDN capacity in global - rather than domestic - volumes may somewhat offset exchange rate downside. After 12-18 months Netflix may slightly raise their prices, as they have done after establishing themselves in other markets. 4. Offer an attractive expanded distribution option for Australian content producers This is where things could get really interesting: • Netflix offers a further channel to market that is for the most part un-conflicted with current commitments (excepting DVD distribution perhaps). More importantly though, it opens up that option beyond Australia into much larger video consuming markets. • Given Australia’s healthy creative capability, an attractive exchange rate, and Netflix’ demand for more original and differentiated content we could see Netflix play a role in funding locally produced content. They may fund local content production outright or in collaboration with - say - domestic broadcasters. Joint content commissions with output rights split between broadcasters for the domestic linear domain and Netflix for domestic and/or international non-linear domain are very possible. These joint commissions would also benefit from the Netflix audience insights platform; further reducing the risks associated with new programming. 5. Augment existing IPTV platforms Assuming the underlying platform technology allows, we should see Netflix apps appear on Australian Apple TVs, possibly on T-Box and Fetch TV too, and perhaps even on Freeview Plus. 6. Enable free-to-air TV broadcasters to double down on innovation Within their sponsor-funded Internet catch-up platforms (Plus7, JumpIn, Tenplay), assuming that for non-linear subscription Internet TV they partner with Netflix or one of the other majors. As ITV in the UK, and others have demonstrated there is still huge scope for enhancements such as sponsored in-app voting (i.e. free to the viewer) for reality TV programming. Advancements in this space are likely to be harder for those distracted competing head-to-head with Netflix and their ilk. So the Netflix red may just bring some unexpected black to media balance sheets here. Seems we’re about to find out, are we ready? Kevin Dillon is Principal Consultant at IBB Consulting, Asia Pacific, which consults to broadband, cable, media and telecommunications companies
- Dan Sloan, a former broadcast journalist for Thomson Reuters, is editor-in-chief of Nissan’s Global Media Center in Yokohama. He oversees a team of brand journalists who produce multi-media content, known as “kotozukuri” or storytelling. In this cross-posting from Mumbrella Asia editor Robin Hicks spoke to Sloan about how an in-house content house works, the ROI of content, and the impact of the brand-side content creation concept on agencies. So how do agencies get involved with the Global Media Center? From time to time, from project to project. We act as a clearing house for agencies if they need content from the archives. We don’t always have it, but we do act as a conduit to get the best version that exists. With every brand there is a process of discovery and development for content. The assets of a company are all over the place. If you want to get hold of an old commercial from the 1960’s, someone’s got it somewhere, but it helps to have a process for bringing it home. Sometimes brands don’t realise that they don’t own all the rights to their own content. Asset management and storage are very important for us, as we’re becoming the go-to centre for Nissan’s visual assets. We need to ensure that that resource is not vulnerable. Wasn’t that an issue when the Fukushima earthquake struck in 2011? We’re located 260 kilometres from Fukushima. It wasn’t an issue, but at that time the Media Center had not been launched. The earthquake was felt all over the place, and there was no de facto safe spot. But that’s neither here nor there. For any brand, you need a secure place where you can store and source content that the company needs. We make content, but we share it too. Unfortunately, if you end up as a concierge for everyone’s digital needs that can take you off your main mission – making stuff. It’s easier for all if acquisition is not too complicated. Does what you do make for awkward conversation with Nissan’s agencies such as TBWA, which also creates content for the brand? Any brand that engages in its own content creation may be taking business away from someone. It was not said by our agency, but I’ve read comments from heads of global agencies, who’ve said that the history of content creation on the client side usually ends in tears – that might be wishful thinking. We’d like to cooperate and also get something back from them always. It’s not a zero sum game. We’re all working for betterment of the brand. One example of a client taking content creation inhouse that hasn’t worked well is Dell and WPP. What do you make of that? From an agency’s perspective, a client can do whatever they like. They suddenly don’t say, ‘hey, we’ve lost that business’. Maybe it forces them to raise their game. This is not a criticism of any agency, but the more people who make content, the better the chance that people see how they can improve – and that goes for us as well. A bit like creatives working in an in-house agency, how do you keep journalists interested in writing stories about the same brand? That’s an argument I’ve heard before, the ‘I’ve only so much attention span for you, one big-paying client,’ thing. But it’s like in journalism, if you’ve got a beat, for God’s sake be interested in it. When we set up the global media centre three and half years ago, it was a process of discovery for us. We weren’t really clear on what the opportunities were. The example I like to give for this is a series we did about our factory in Yokohama where GT-R engines are made. The engines are handmade by four guys who are master craftsmen. We’ve made four videos about their work. I couldn’t believe we hadn’t told this story before. They’re not telegenic models, they’re factory guys. It is a great internal pride story. It’s a heritage story. It’s a brand lover story. It pushes all the buttons. It’s a no-brainer for storytelling. But for an agency, that’s a hard thing to condense into 30 seconds. This main video runs for more than six and a half minutes. I can’t tell you what the average watch time is, but I would bet that it’s over two and half minutes. With agencies what you get is shorter, and can cost more, but it has its purpose. https://www.youtube.com/watch?v=KMqRuN7wyvQ Do you see a lot of churn in your department? We’ve only been around for three and half years, and no one has raised their hand to leave. Relative to some other job opportunities out there or in traditional media, what we do seems to be vibrant and interesting. The real element of this is the job doesn’t feel like desk work. So how did the Global Media Center come about? We started in April 2011 at a time when Japan was dealing with a string of natural disasters. We had a story from the get go. We had to achieve an internal confidence to get the factory doors and R&D to open up. We flew in formation into that window of opportunity. But then you have to find the next story after 3-11, and to sustain the narrative beyond the metaphor of a comeback. We’ve had the return of Datsun. That was a strong story. But you never know what’s going to work. Some of my staff, who are motor sports enthusiasts, came to me with an idea about electric vehicle (EV) racing. https://www.youtube.com/watch?v=YPYmge92P0A I said make sure the piece was at most two minutes long and in English. Instead, they produced a seven-and-half-minute piece in Japanese with English subtitles, which is usually the kiss of death. It was a behind-the-scenes piece in which they spoke to the race car driver, engineers and designers. It turned out that Top Gear embedded the video on their homepage and it went viral, generating over 90,000 views. We made different video takes on the same idea ultimately, and it was easy – and free. How independent are you of corporate HQ? We have Comms departments from other companies visit us, and they’re always astounded by our relative autonomy. There’s a question mark over who ultimately takes responsibility for what we produce, and thankfully when we started out we didn’t screw up. The mentality of staff was that we’re a ‘Start Up’. Some things didn’t work out, but we had to keep trying different things and learn as we went. So what hasn’t worked? Sometimes the things that we will think will go viral are stillborn. There’s a science to what will be well received, such as when or what time a video is released, but the insights we have picked up have often been the result of guess work. I love the CSR content we make. But that sort of content will almost never go viral – nor is it intended to. That’s the finest line that you tread as a brand as there’s potential for you to be seen as exploitative. We did a piece on an area that was hit hard by the tsunami disaster. It was a school building where the community went on the roof, because everything around it was underwater. The story was about the people who went through that experience, and how they got on with their lives two years after. Is that a car story? No. But it was a piece we were proud of, and was picked up by Fuji TV. https://www.youtube.com/watch?v=2O6m-MzNvdM Can you talk about the cost of a media centre like yours? The minute I show a slide with money on it, it will come back to haunt me. But the do-it-yourself approach can pay for itself quickly. How big is your team? Including contractors, we have between 10 and 14 people. We have a North American group in Franklin, Tennessee, and a London team. But only Japan has a broadcast facility. Do you handle social listening as well as content production? Real time marketing is a process of discovery and every brand needs to find their own way. Some brands take the one-way push out approach – ‘Here’s our piece, and we hope you like it’. Originally, we had oversight of our Facebook page, but soon found that people would respond to our content with an unrelated vehicle comment. Our team wasn’t equipped as a customer service unit. We had to use our presence to point customers with product queries through the appropriate CRM avenues. One area that we haven’t mastered is the art of a conversation. Listening posts are fine, but being in the conversation can be much more valuable. Do you think that social listening and production should be kept as separate disciplines? Speaking with consumers – there’s an art to that. Listening and creating are not the same skill set. How does Nissan work out the ROI of what you do? All of marketing and communications is charged with increasing the share of voice and overall opinion of the brand. We have tools that can help us to get an unfair share of voice – where we reach more people than our market share. We can’t correlate our contribution to that numerically, but we did rise in the recent Interbrand rankings [of the world's most powerful brands, from 65th to 56th] and that shows that we’re heading in the right direction – to sell more cars. A personal question for you as a journalist. Doesn’t it bother you that your work could be seen as inherently biased? I accepted from Day One that I’m working for a corporate. We tell the brand story to elevate the brand. However, the audience doesn’t want to watch an info-mercial – and keeping the ‘So-what’ bar high is our job. In the disaster days, all Japanese exporters faced rumours about radiated vehicles, so we did a story about the safety checks we were doing on cars before shipment. If you speak directly to a situation, you can sometimes nip it in the bud. Ultimately, if you can look yourself in the mirror as a brand, the audience will appreciate that. You don’t have to show all the warts, but reality works.
- In an open letter Jon Holloway sets out a manifesto for the changes he thinks the advertising and marketing community need to make to save itself.
It’s time for change, radical and evolutionary change.
No point us all talking about it, constant rhetoric and then back to the day jobs to do things they way they have all been done.
Working in the advertising and marketing world is one of the best jobs any person can have, we play with ideas all day and get paid to do it. We are all on the hook to get this amazing industry back on track, because in all honesty, we are in serious trouble.
We are supposed to be the most creative industry in the world; but truly in all essence 90 per cent of what is done is lazy, drawn on a canvas that hasn’t changed for 40 years and mostly we are playing at being different without changing any of the fundamentals parts of our business that keep us safe and warm.
It’s time for serious and radical change, we need a new mindset and new operating model that starts from the core of what we do, why we do it and essentially who we employ to do it. We are under attack from every business that can see the wasted dollars, the wasted time and the scarcity of real, sustainable results; start-ups to consultants are coming to get us.
We are living in the time of advertising and marketing mediocrity. Not because we can’t make adverts and put them in to the media, but because WE ARE making adverts and putting them in to media.
We exist today on a burning platform:
We define it in completely the wrong way, harking to an old world that no longer exists. We live in a world of constantly evolving landscapes, creativity now comes from those who always learn and are constantly changing their skills.
2. CONSUMERS AND AUDIENCES
It’s always been a problem for me to define people this way, however in a world of unlimited choice where information and product is available in every format. We need to unlearn everything we think we know about humans.
Any business that is built relying on media to sustain sales and growth isn’t going to survive. On a long enough scale every product would die. Media is a great amplifier, but it shouldn’t be our reliance and shouldn’t be 70-80 per cent of what we spend.
We are constantly looking back and inwards; we are stuck in doing thing the same way they have always been done because it used to work. We use data retrospectively and seem unable to forge a future based on prediction, risk and trying the new and next.
We are an industry that believes every problem can be solved with advertising. Advertising is an answer; but maybe it’s not the right answer most of the time. It should only be a small part of what we do.
The models of most agencies and marketing teams are the same as they have been for 30 years. We have bolted on other skill sets without changing the approach, people or core of what we do.
The advertising and marketing merry-go-round is well documented; people jump from shop to shop and from brand to brand.
The gene pool is too small; everyone is trained and learns in the same way, does everything in the same way. There are very few outliers in our increasingly safe world.
The size of the industry is driving safety over creativity. Everyone is driving profit from what they have always done, managing shrinkage and reporting upwards to global networks and brands. Safe is killing us.
We don’t push anymore, we are a protectionist industry, keeping the status quo is enough to make a good business. The future won’t allow this, we need to learn to push each other.
Why do so many ad campaigns from different agencies in the same category look the same? They have the same data, the client has the same data and they all get to the same conclusion. We use data badly, we create the wrong story from the right data.
On top of all that, we are an expensive industry, costs of salaries are increasing and the brands are willing to pay less for our services. If we don’t find a way to charge differently and build models differently, the simple fact is that the businesses will die from natural causes.
In my opinion, we are all asking the wrong questions and accepting the wrong answers. We have become lazy, we have become bloated and we need to start making changes today. It’s not going to happen overnight, but needs to happen and start today.
Five steps that we can start to change today:1. DEFINE THE PROBLEM Before we try and fix it with advertising, lets spend more time thinking about the problem. Marketers are trained to create marketing and communications, not fix problems. Advertisers are trained to create advertising, not define problems and create solutions. We both need to become better at it, together. 2. CHOOSE THE RIGHT PARTNER Every advertising agency is talking about not being an advertising agency. However innovation, digital transformation, human centricity and technology aren’t the specialities of advertising agencies. Ads are, when you need advertising, go to you advertising agency. Marketers choose the right partners for the right job and don’t be afraid of risk. 3. COMMIT TO REAL CHANGE The fundamental problem is the core of advertising businesses still makes money from doing things the way they have always been done. The outlaying services of the future are hard to embed and radical innovation is hard. Agencies, it’s not impossible, commit to it and back it with cash, people and get it at the core of your business. 4. NEW TALENT Lets persuade different types of ideas and solutions people to join our industry. If someone has always worked in the advertising industry they are probably not a good bet for the future. Agencies and marketers need to take calculated risks with new people. 5. MEDIA LAST Let’s step back and look at media for what it should be, an amplifier of greatness. Let’s focus on getting the right solution then look at how media can help to amplify it, if at all. Focus on real personal connections that can be monitored, measured an utilised. Over to you all for your opinions, what would you change today, what do you think doesn’t need to change? Interested to see whether this is just my opinion, where I am wrong and what has been missed? Jon Holloway is managing director at The Conscience Organisation
- In a guest post for Mumbrella BrandMatters managing director Paul Nelson looks at Qantas' new TV campaign, arguing while it is a beautiful piece of advertising it is not enough to overcome the brand challenges of the past three years. On Sunday night Qantas launched its new TV campaign across all the major Australian TV networks. The TV-led campaign is an attempt to get Australians to reconnect emotionally with the embattled brand. It is unquestionably a beautiful piece of advertising. But from a brand strategy perspective, it isn’t enough to overcome the brand’s challenges of the past three years and increase flagging revenue. There is a succinct saying that neatly sums up the Qantas brand challenge: brand is a promise delivered. Unfortunately for Qantas, advertising alone can’t rebuild a broken brand – especially a brand that is perceived as not delivering on its promise to passengers, its employees or the Australian public more broadly. https://www.youtube.com/watch?v=16RhgfA662k&feature=youtu.be Although advertising alone is insufficient to be the entire answer, there are three actions that Qantas can take to begin to rebuild its brand in the mind of its audience: Rebuild trust: When many Australians think of Qantas today they call to mind the 2011 global fleet grounding, the replacement of Qantas routes with budget partner Jetstar flights, sending maintenance jobs offshore, safety scares and recent rounds of large scale redundancies. The erosion of trust is having both an emotional and economic effect on the former national carrier. Trusted brands have committed customers who are not only willing to recommend them to friends and family, but display a willingness to pay higher prices: a ‘trust’ premium. It is the result of long term investment and commitment and, unfortunately for Qantas, cannot be rebuilt in a day. Reconnect with employees: We would argue that the advertising as presented captures the emotion of when Qantas had proud and passionate employees – be they call centre operators, check in staff, cabin crew and even captains. There was something quintessentially Australian about that experience then, that made it ‘our airline’, especially when heading home, as the ad’s insight taps into. It was a perfect balance of Aussie genuineness, good humour, and relaxed and friendly service, all underpinned by a safety record that was the envy of every other airline worldwide. But we all know what happened. After multiple rounds of redundancies, Qantas employees are doubtlessly fearing an uncertain future and, as a result, suffering from a lack of trust and feeling disengaged from their employer. Yet employees in a service business are an airline’s most valuable assets – a living example of the Qantas brand promise – and the impact of a disengaged workforce on a company’s bottom line can’t be overstated. Engaged workers feel valued and connected, and approach their work with far more passion than those who don’t. Two of the keys to building a strong employee brand are demonstrating inspired, committed leadership and communicating a sense of vision; and offering employees the tools and knowledge to deliver on the brand promise. Repair the customer experience: Qantas needs to invest in ensuring that the rational experience of its service aligns with the emotional connection it is attempting to repair. Qantas needs to reassess what it is about its customer experience that makes it different, and use its reengaged employees to deliver on this unique experience on each and every flight. For Qantas there is no simple advertising solution for repairing its reputation with its Australia audience, no matter how emotional and beautiful to watch. Alas, brands aren’t built or repaired by advertising alone. That said, when done well, advertising can act brilliantly to create awareness about your product or service proposition in a way that has your target audience consider or re-consider you and, in turn, view, read, listen, phone, click, or seek, to learn more. We hope (and in fairness, expect) that Qantas understands this. As a business under pressure however, the natural inclination might be to outsource its brand repair work to its ad agency. Let’s face it; that’s much easier than what we’re suggesting. However appealing that might be, we would strongly caution against this. It must start with its leadership, its culture and its people. It must start inside, out. By doing this, it will rebuild its relationship with its employees first and instil the pride of the Qantas brand in them. In our view it’s this strengthened relationship with its employees is the only sustainable way to improve and create its desired customer experience. Paul Nelson is managing director of BrandMatters.
- In a guest post for Mumbrella, composer and music branding specialist Anthea Varigos analyses the musical content of Australia’s TV commercials from throughout 2014. It's obvious once you notice. Ads have their own musical colour palette. As I begin this project, the screen is soon awash with beauty products, insurance and cars. Before long I start to hear similarities in the instrumental pallets and genre choices for various product segments. There is "pink" sounding music to capture your attention if you are a girl. This frequently has an upbeat dance vibe and a rather stereo-typical chimes/bells sound because girls love pretty things. Olay Regenerist is a perfect example. http://youtu.be/iFt6cxYz304 There is "blue" music for men; the expected cock-rock, sometimes with industrial four-to-the-floor beats. Like this promotion for Hog's Breath Cafe's V8 sponsorship. http://youtu.be/kqf-vHek6-s (Oh, yes) Interestingly, the other "blue" music is epic cinematic orchestration often used in the automotive category, such as the final third of this Hyundai ad. https://www.youtube.com/watch?v=fXtaxdnGVbg If you are a family, or the product is attempting to appeal to a wide spread of the population there is "yellow" music. A hipster-happy palette of marimba, whistling and 'doot doot doot's that insinuate the joy associated with purchasing products. You can hear these toe-tapping tunes can't you? http://youtu.be/rO2znf_bCvA For the baby-boomers, the songs they used to party to when they were hits have now been converted into what only can be described as "Magnolia" muzak. That's because of how important those songs were in connecting with them. They spend the majority of their music budget on licensing the song. Times are tough though, and to pay for the recording license is another separate expense. Perhaps this is why they opt for a cheaper midi-version rather than your hero's original. https://www.youtube.com/watch?v=YYQxYsANRNg Products want to be positive and "yellow" music is perfect for it. Our ears are prone to saturation however, in a similar way you can only really focus on three scents at once - any more and they mould into miasma. When there are too many tracks of a certain type, the music becomes homogenous. As much as it's happy to listen to, I wonder whether brand recognition could improve if there were a little more diversity. Brands are all unique, with their compelling reasons to be best - it's all too easy to lose sonic identity in the crowd. Music is a wonderful tool for assisting with targeting and connecting with gender and ages. This is why so many commercials use the sound palettes described above. Music however, can delve deeper than just the fact that I may be female and you may be male, or whether we are old or young. My favourite example of understanding music and expanding beyond sonic stereo-types is, rather ironically, AAMI's "Don't share the bath water". https://www.youtube.com/watch?v=yRNJJRlOUbU As audience members, we rarely notice when ads have no music at all. This can be an incredibly effective technique when used correctly. The choice not to include music in the AAMI ad is wonderful. It assists the awkwardness of the situation, makes the scenario feel 'budget' and connects with the messaging. Dyson's latest commercial has no music either, rather it's just the sound of the vacuum which is clever too. It is difficult to remember the brand after ads with no music - the AAMI ad ends with a sound sting; the Dyson ad does not. http://youtu.be/yoTISJoIb_A These are rare cases though, and for the majority music is fundamental to campaign success. Hair loss brand Ashley and Martin Institute could do with some musical assistance and yet they've opted for silence. http://youtu.be/EqWJWPgpiqs There is a voice over and couple of validating ‘science'-sounding effects. A reason that music first started being used in films was to connect the audience because it pulls us into narrative and stops us feeling like a removed observer. One would think making customers feel comfortable would be a priority in this conversation and not having music here is alienating. Would it be more engaging with science-sounding-light-electro or, if sounding clever is important, some Bach on the cheap? There is no denying that pink, blue and yellow music all have their place in ads. In the design world CMYK is used for print and RGB is used for the screen. It is the spectrum of colour however, which delights our eyes when we watch TV and our ears are just the same. In a world where standing out in the crowd is vital, the choice of music and at what level this engages audience members is still important. Finding that golden sound which is exactly your brand, not just the demographic stereotype, will create a stronger and more memorable connection to your consumer. Anthea Varigos is creative director of sonic branding agency BrandSound.
- Earlier this year a group of well-known high street travel agents rebranded under the Helloworld banner. Steve Jones sat down with marketing boss Kim Portrate to discuss the challenges of rebranding a legacy business, why creating a brand from scratch is like an iceberg, and how the job is never done. It's no secret that high street travel agents are under pressure from their low-cost online counterparts. Add that to the fact the sector has been dominated by retail giant Flight Centre and you start to get the scale of the challenge facing the new Helloworld brand. Marketing has been underway for several months in a bid to force Helloworld into the public conscience, with CMO Kim Portrate insisting she was "comfortable" with its progress. The launch of Helloworld just over 12 months ago followed a protracted internal review at what was then called Jetset Travelworld, a troubled ASX-listed company which consisted of four retail travel brands; Jetset, Travelworld, Travelscene American Express and Harvey World Travel. https://www.youtube.com/watch?v=lEnNrnYnNAs All four were controversially ditched in favour of a fresh start - Helloworld - as the company looked to streamline its operations and create a unified network which required one, rather than four marketing budgets. The rollout of the brand was dogged with problems, most notably the unrest of agents, in particular Harvey World Travel members who remained steadfastly loyal to the brand, while chief executive Rob Gurney departed prematurely earlier this year amid a review into "management style". So far 300 shops have taken the full Helloworld identity, 400 have become dual branded while 300 have become affiliate members of the network. One hundred remain with their previous networks. Portrate declined to reveal awareness data for Helloworld, claiming it was "not appropriate" to share such information. "Put it this way, I don’t lie awake at night feeling uncomfortable. Is the job done? No, but it’s never done," the former Tourism Australia marketer, who joined Helloworld in October last year to spearhead the launch, said. "This is not the first time I have launched a brand, but it's complicated and anyone who tells you it’s a walk in the park must have superior skills to me. "It’s detailed. It’s a bit like an iceberg. There’s stuff above the water which is easy and people can comment on, but you have to internalise the brand and the culture. What do you stand for? Why are you important? What do you mean to people? What are they going to say to their friends about their interaction they have with you? All of that work is almost more important than a 30-second TV spot or the rich media you place." Helloworld appointed Droga5 to handle its creative work last year and in May shifted its $14m media account from Initiative to OMD. Portrate said it has built on the "passion" of its independently-owned agencies, some with 40 years of experience, to position the brand as "experts of everywhere", a tagline which emerged following consumer research. "We started with the consumer. That was the focus. What does our audience look like, what did they want?" Portrate told Mumbrella. "We found they wanted contemporary, they wanted modern. They had moved forward. The advent of more accessible information that is available 24/7 meant they were a better informed consumer than a decade ago. "It’s not exclusive to travel but consumers want a unique experience so the idea of marketing to one is super important. You want to be the person at the dinner party who has been to Peru, or done that special something that no one else has done. "But you need experts in travel who can facilitate that. And as much as people are researching across a number of channels, a recommendation from a person who has physically been there and done it carries a lot of weight. "The Helloworld brand is about delivering consumers a superior travel experience and our view is that we can build a better holiday than the consumer can build on their own. And the proof points are the 40 years of passion and expertise and knowledge in travel. "My view of brand positioning is that the less complicated you make it the more compelling it will be, as long as it’s true. "I also believe that if a consumer has a great experience in a Helloworld store then the consumer will like Helloworld. I know that sounds simple but it’s almost as uncomplicated as that." Portrate, who held senior roles at BBDO Worldwide and Carat before joining Tourism Australia as consumer marketing director in August 2008, acknowledged that creating brand awareness was paramount, but argued that building a proposition was equally as vital. https://www.youtube.com/watch?v=jiOrAmoSJxw&list=UUiit29I64x8sjaZTCsMDOhQ&index=4 "A name only has meaning after you have put a value proposition around it, but it’s difficult to engage with a brand if people don't understand who you are, that’s fair comment," she said. "That is why you are seeing fairly substantive national marketing programs. We have been in market consistently since March and that is required to establish the brand, not just its meaning but the physical awareness. "We have the benefit of high street branding. We are physically present in the customer's mind which is a huge advantage." Flight Centre managing director Graham Turner said at the launch of Helloworld that it takes a decade of solid marketing to truly establish a recognisable brand. Some in the industry took that with a pinch of salt, designed to undermine its new rival, while others backed the estimate. Portrate refused to be drawn on the time frame needed to establish a brand, suggesting it depended on the sector and market dynamics. There are brands which have risen rapidly while others who have been around for many years "maybe don’t have the level of awareness they require", she said. "I certainly wouldn’t contradict Mr Turner. The best observation I can make is that the comment was based on his experience, so based on that, his comment is true," Portrate said. "We are comfortable with our level of awareness." She declined to reveal the marketing spend, although it's media account is thought to be worth $14m. "That is commercially sensitive but we are spending enough to make sure people understand who we are." Portrate said Helloworld will continue with a mix of marketing, including TV, digital and press, saying the customer "lives in an omni-channel world" which marketers must adapt to. She described working with a variety of channels as a positive for the modern marketer as it "enables you to do lots of things at the same time", but added: "My head sort of explodes when I think about the list of paid and unpaid channels, there are so many." "It’s lovely when you see these slides where it’s all linear, but we know the customer journey is more like a Gordian Knot," Portrate explained. "The customer lives in an omni channel world and in all of our advertising we offer an omni channel solution rather than making a decision for the customer about where they can and can’t reach us. "Customers will choose the channel. Our job as a brand is to make it open and engaging and as useful an experience however they engage." Turning to social channels, Portrate said it was challenge for any marketer to find a balance between "advocacy and commerce" with Helloworld committed to finding a blend between the two. "I don’t like the blanket term social media because Twitter behaves quite differently to Facebook which behaves differently to LinkedIn. They have different jobs to do and they can be powerful tools," she said. "There are some who see social as a commerce channel, but I see it as a blend. I think consumers live in an environment that if they are getting value from a content provider, almost irrespective of channel they will continue to see value and build a relationship. "At this stage Twitter is to keep people up to speed with things we are doing. Will our social media strategy evolve over time? Yes, but I don’t think we’ll ever lose that blend of advocacy and commerce." Portrate added she was exploring new marketing avenues, including Instagram and content marketing. "All things are possible. That’s my job. That is what a marketer is supposed to do," she said. "It would be great to be everywhere all of the time but that would be impractical. But that doesn’t mean you stop looking, everywhere. You have to make determinations about the right kind of place for your brand that is relevant for your customer. That's your starting position." Portrate concluded: "It doesn’t matter if you're a new soda, travel agent or car, the number one job is making sure you are well known and understood to drive advocacy. I am methodical and focused on that number one job." Steve Jones
While the video streaming battle has garnered most of the headlines it is just one piece of a much more lucrative puzzle being pieced together by the telcos. Nic Christensen talks to some of the key players in the looming "triple plays" war set to redefine the media world.
Brace yourself, a media winter is coming.
But it's not the impending streaming war between Presto, Netflix and newly minted Stan that you've been hearing so much about that will redefine the Australian media landscape, but rather what sides the various media companies fall on.
The prospect of Netflix officially arriving on our shores has had consumers and the media salivating over the idea of a battle for the best and cheapest video streaming offering. The impending arrival of the US streaming giant has forced the traditional media companies to come to the table, with Foxtel rolling out Presto as it seeks to preserve its pay-TV dominance, and Nine Entertainment and Fairfax's Stan seeking to carve out its piece of the burgeoning subscription-video-on-demand (SVOD) market.
But to industry insiders the headlines and consumer buzz about these services has missed the bigger point - the realignment of Australian media around the distribution platform of the future, which will be delivered by Australia's telcos.
The biggest telco, Telstra, has already picked sides courtesy of its 50 per cent ownership of Foxtel with News Corp. And while the likes of Optus, iiNet, and Dodo support Foxtel rival FetchTV, it is far from clear where the likes of Nine, Fairfax, Seven and Ten amongst others will fall.
But these streaming offerings will just be the honey in the trap for the telcos looking to lure consumers into the more lucrative 'triple play' offerings, bundling phone, fixed internet and pay-TV services together. And the first shots in this war were actually fired on Monday.
Streaming: The winners will be the best and biggest marketers
Talk to those in the streaming space and the preparations for battle have been going on in earnest for some time.
While the financially troubled Quickflix has operated for some time with limited penetration, most observers cite the confirmation by Nine last December that it would enter the SVOD space as the move which really started the manoeuvring in earnest.
Nine's announcement saw Foxtel accelerate its plans for movie streaming service Presto, which launched in March. News that US streaming giant Netflix was talking to local distributors in June added to the sense of urgency.
[caption id="attachment_261006" align="alignright" width="201"] Presto's Shaun James[/caption]
While Presto might have been the first of the traditional media company plays to make it to market in Australia, its boss Shaun James is under no illusions about the intensity of competition that is about to emerge: "We have three very determined offerings about to enter the market - we are up and running and the others are coming," he said.
The reality is while Presto might be the first to officially launch, Netflix had long since gained a head start by allowing an estimated 200,000 Australian subscribers 'back door' access to its US service via virtual private networks (VPN) to overcome a US geo-block.
"What is driving VPN use is the appetite for a low price point IPTV SVOD service," says Megan Brownlow, editor of PwC's Australian Entertainment and Media Outlook report.
When we built our forecasting model we used the 200,000 figure, which had some informal verification from Netflix. Subsequent to that we had another bit of intel from Netflix that this was too low."Brownlow predicts while there has been a focus on the content side of the battle - Presto with HBO shows like Game of Thrones, Stan with Better Call Saul and Netflix with Orange is the New Black amongst others - the marketing arena is where customers, and dollars, will ultimately be won and lost. "This will be a marketing war not just a content war," she says. "It’s going to be a marketing war and the winners will be the best and biggest marketers. That is why I think it is so interesting having Nine Entertainment in the mix because Nine has a long history of really working marketing economies well. Foxtel are brilliant marketers too because they have had to play defensively." StreamCo CEO Mike Sneesby says he is under no illusions how important marketing will be to its survival in the space. "We want hundreds of thousands (of subscribers)," he said, following yesterday's media conference announcing its consumer brand name Stan. "We have said three to five years is the timeframe, but it does come down to what happens in the competitive landscape." Netflix did not respond to requests for comment, but Presto's James said he did not believe it would take years for the SVOD battle to play out. "It will be interesting to see how it plays out in the next six to 12 months," says James. "I do think it will be that quick - we will have a good indication in the next year, depending on when the others launch of course, but consumers will make a decision about the content within the services, the consumer interface, pricing etc." One thing is clear: few people believe the Australian SVOD market is big enough for three, let alone four players if you include Quickflix, whose share price hit a record low this week. It is interesting to note that when the likes of Presto or StreamCo talk about the streaming market they usually only refer to three rivals - Netflix, Presto and Stan. How the combatants are aligning Fetch TV CEO Scott Lorson points to "two discrete battles taking place in Australian media." [caption id="attachment_261027" align="alignright" width="200"] Fetch's Scott Lorson[/caption] The IPTV service pitches itself as a 'Foxtel-lite' offering limited pay-TV channels for lower prices than its rival. It is backed by the deep pockets of Malaysian parent Astro All Asia Networks and sold through major ISPs such as Optus, iiNet and Dodo. He explains: "There are two distinct competitive environments emerging - one is the platform play which is all about the full pay-TV platform, which is the battle between Foxtel versus Fetch TV and our associated partners. And then you are also seeing a separate battle emerge for over-the-top (OTT) all you can eat SVOD services emerge. All of which will be about competing with Netflix in this market." This emerging battle has produced some serious media posturing from various parties in the last year, as almost every major media player moved to find a partner or ally. While many column inches have been dedicated to the $100m tie up between Fairfax Media and Nine Entertainment with StreamCo, there is also speculation the biggest free-to-air network Seven West Media will strike a deal with Foxtel's Presto service, before it flicks the switch adding TV content to the service in the coming months. Seven CEO Tim Worner was also a surprise guest at last week's Foxtel upfronts, with Presto's James refusing to be drawn on the detail of any imminent announcement saying only "we will announce in due course." That deal would see the biggest free-to-air network, pay-TV operator and telco all on the same side. On the opposing side there could also be what is described as "everyone who's not Telstra and Foxtel", aligning with the likes of Optus, iiNet, and M2's Dodo in an alliance with Fetch TV, a clear attempt to counter the massive market power and might of their major rival alliance. That leaves Network Ten as the only company without a dance partner. While the troubled network is nominally the only one not to in some way signal its intent, speculation is growing that Discovery Communications is weighing up a bid for the network with Foxtel, aligning it with the Foxtel/News Corp camp. PwC's Brownlow says that many of the media/telco partnerships make sense. "In terms of that type of alignments we are seeing, I think it is really logical and really healthy because we are in a different world now where the distribution is often global and we are up against global competitors," she explains."When we look at the market in the future it is going to be critical to have scale via partnering." The difference in the money involved in the two elements is huge. The average earnings before interest, tax, depreciation or amortisation on a fixed Australian landline bundle is thought to be in the order of $30 a month, well above the $10 per-subscriber revenue on offer in the SVOD war. And that's before you factor in the high cost of content deals, churn upwards of 50 per cent, and the high cost of acquisition through marketing. Speaking to Mumbrella yesterday, Lorson noted that he would welcome SVOD players into his ecosystem but made clear he was focused on the wider telco war. "The stakes are enormously high in that (telco) battle, given the strong profitability of fixed line telephony services, and the importance of TV as a hero proposition in a bundle," he said. "We are built exclusively for that battleground and that’s where our focus lies. "We have spent five years and invested $100m to establish our strong strategic position currently, and we are now an incredibly viable and well positioned business. We see lots of competitors in adjacent markets that are just commencing that process but we do acknowledge that there will be plenty of casualties along the way."
The 'triple play' telco war has already started
Last Monday saw the opening round of the conflict, with Foxtel implementing its biggest ever price cuts, halving the entry price to $25 and expanding the number of channels in the basic package. On the same day Telstra expanded its triple-play offering to include 40 Foxtel channels from 13, at a price point of around $100. Meanwhile Optus introduced an entertainment bundle aggressively priced at $75.
All of the price changes are likely to be supported with big marketing spends.
"We believe the starting pistol was fired last Monday," explains Lorson, who argues his brief from his telco partners is to ensure he grows his 140,000+ subscriber base by offering a "hero proposition" for their bundles in order to compete with Foxtel.
If you go to the Telstra, Optus, Foxtel or Dodo website as of Monday you are seeing an entirely different level of aggression than you have seen previously.
"From a FetchTV perspective our brief from our partners is to develop a compelling consumer proposition that allows them to bundle and win share. That is what we are built for."
Fetch TV is not alone, with Presto boss James signalling that not only is pay-TV operator Foxtel cutting its price, but also actively considering putting Presto into the wider triple play bundle.
"We have been doing a lot of work to go to market and it is not an unusual thing to see SVOD products bundled with other services like broadband and other services. There are plenty of other examples of that in other markets."
Such a move could be decisive in the SVOD battle, potentially putting Presto into the homes of Foxtel's 2.5m subscribers. "It is an option and is certainly something we are looking at at the moment," says James.
PwC's Brownlow argues that the triple play strategy makes sense on all sides, but both the SVOD war and the wider telco war will put major pressure on average revenue per user (ARPU) for both the telco players and cash-cow Foxtel, which currently has one of the highest ARPUs in the world for a pay-TV provider at just under $100.
"There is going to be significant pressure," says Brownlow in relation to Foxtel's ARPU. "But I think they have come to terms with that and recognise that those days of (high ARPUs) are over.""Triple play will be a great defensive strategy for Foxtel to reduce churn and worldwide we know that that is what triple play does. "So when we look to the US market where the pureplay cable businesses are really suffering from 'cord cutting' (consumers unsubscribing) the beneficiaries have been those vertically integrated businesses - the telcos, who also have media and who are the ones offering triple play."
Who will survive and what happens next?
It is difficult to know who will win either the SVOD war or the wider triple play telco war, but there will be casualities, and there is already the smell of blood in the water.
But it is clear however that many of the players are already seeking to capitalise on the misfortune of others to limit their losses. As Mumbrella revealed in July, Nine's decision to buy eight percent of rival Quickflix from HBO appears to be a strategic play, spending $1m for preference shares that give them first rights on content should the company once again experience cashflow problems.
Since July Quickflix's market capitalisation has fallen from $17.8m to just $9.14m and on Tuesday the share price hit a record low of 0.005 cents.[caption id="attachment_145379" align="alignright" width="150"] Langsford[/caption]
Yesterday Quickflix chairman Stephen Langsford sought to put the best spin he could on its performance, echoing previous statements welcoming new competitor Stan to the market, and noting Quickflix was positioned in a growth sector.
"It probably is (a record low share price)," said Langsford, "but I think we are most definitely in a growth sector and secondly yes there are big players, but just because they are big doesn’t mean they will execute well."
Perhaps, but both Presto and Stan appear to be ready to make life very, very hard for Quickflix.
Foxtel's new HBO content deal, flagged at last week's 2015 Upfronts, will apply to Presto, and has the potential to deny Quickflix key content. Yesterday Presto's James was reluctant to be drawn but noted: "What Richard (Freudenstein - Foxtel CEO) said at the Upfronts was that we had secured a deal with HBO. That deal extended across all the Foxtel services of which Presto is one. We will announce titles shortly."
Quickflix insists that any exclusive deal will not impact it access to key franchises such as Games of Thrones, but the move will be an important one to watch. "We still have HBO content we expect to continue with HBO content," said Langsford.
There is also the small issue of the massive marketing war chests of the SVOD and telco players. StreamCo boss Sneesby said yesterday:
It is a content and marketing game we will go head to head on acquiring content and we will go head to head on marketing".
Presto's James is also not shy about a looming marketing tsunami, saying: "I think there is an education piece as well and there is plenty of evidence that says domestic content offerings are successful and we certainly feel that way about Presto."
Some in the industry have described Presto as a "head on a pike", a message from Foxtel to the likes of Netflix it is prepared to ramp up its offering should they come to Australia, but not before, in order to avoid cannibalising its existing pay-TV business.
It is an analogy James takes as a compliment. "I think it is a pretty extreme description," he said, "but I think it is a recognition that Foxtel is responding to the different ways consumers are choosing to consume content."
In the telco battles the challenges facing all the players are similar, argues Fetch TV's Lorson who says SVOD may help them win the wider war.
"This whole thing is about developing a compelling consumer proposition that allows them to bundle and win share," he said."For us we see SVOD as one of many services that people may choose to access and as such as an ecosystem platform to integrate third party services and make them available via FetchTV." PwC's Brownlow is reluctant to pick winners, but acknowledges a lot of money is about to be spent in a battle for supremacy, as all sides jockey for their share of a growing pie. "When you talk about the ‘war’ it’s going to be a marketing war and the winners will be the best and biggest marketers," she says. "For sure the media will be swept along." "The growth will be in IPTV. I have no sense of who is going to win. But because the pie is growing and everything is shifting to the internet more Australians will take a subscription television service." The battle lines are being drawn. The ability to market services effectively and acquire the best content will eventually determine who stands, and who falls. Nic Christensen
- Media offers some of the most interesting career opportunities to graduates, but most of them don't know they exist, argues MGrad graduate Jacob Hkeik. Last year I barely knew how media agencies worked. While they can be big and complex beasts I am not sure the industry is doing enough to explain themselves to potential graduate recruits. And that's before you add in the intricacies of each specialisation. This has been my observation since I attended Mumbrella360 in June, which opened my eyes to the breadth of personalities and skills that exist within the marketing, advertising and media industry. I knew that marketing or advertising was a field I wanted to get into, and an internship at BMF Advertising earlier this year helped cement that ambition. Having that experience, and many thanks to the BMF team, enabled me to start honing my skills through work experience. Going further, I began looking at the plethora of media and advertising industry specific programs to get even more skilled. While I still had two years of my degree to go, postgraduate options are still out of reach at this stage, especially whilst I was working part time as the marketing manager for both a cosmedical clinic and a TEDx event. However despite my attempts to better understand the marketing industry, I was still unsure where, or how, media agencies fitted in. It was at Mumbrella360, and specifically the MGrad day, that my understanding of media agencies began. It was my first industry conference and the flair of presenters, exhibitors and attendees sparked my excitement about a career in this field. The MGrad day was held by WPP’s GroupM agencies where speakers from the group explained what media agencies do and examples of their work. It was here I had a chance encounter with Greg Graham (or “Sparrow” as most people know him), the new business and marketing officer for GroupM, who - with an offhand quip - quickly compelled me to get involved. The brief for applications asked for passionate and creative responses, so I sought to capture their attention. Thankfully, it worked. [caption id="attachment_260939" align="alignright" width="234"] MGrad students visited Google[/caption] A couple of weeks later I began the MGrad program; an eight-week paid internship plus accompanying training course that introduces graduates to the world of media through the eyes of a media agency. There were 14 graduates in the program (who were working amongst the GroupM agencies) and we were fortunate enough to visit or be visited by Google, Southern Cross Austereo, Twitter, NewsCorp, Facebook and more. Each company took the time to educate us on their medium, how they interact with their consumers and how we as agencies work with them. In addition to the training I received, I worked in the marketing and new business team in GroupM and was mentored by Sparrow - which was a priceless experience in itself. I may never know which part of the program I learnt more from: the training or the work experience, as they both develop different parts of the necessary education to make a real contribution in this industry. It was incredibly beneficial to be training and working at the same time, and this is an experience that too few graduates will have. This is a flaw that universities and the industry must work together to address, as each experience enhanced the other. The exclusive access media agencies have to the most important media outlets was a great eye opener as well, and the access to events and brands that come along with the job are incredible, so I began to wonder - how did I miss such a sexy industry when considering my career options after high school? Also, how many others graduates have, or would, miss it too? The reality is every person is affected by media. Everyone sees the magazine ads, the billboard, the flashing images in the palm of their hands - it seems almost unreal that most people, let alone graduates, do not know or recognise the breadth of skills required to make and bring campaigns to the target audience. The way I see it, media is a powerful industry with ever growing scope and social responsibilities and given the creative dynamism and influence of the people in it, it should be able to select from the cream of Australia's educational crop. For students, compared to the prominent top-of-the-tree industries for premium talent - such as finance and law – I quickly realised that media is the best industry for graduate talent to be in. As the media landscape constantly changes, you must move twice as fast to stay ahead. Staying ahead means understanding the changing ways people use and consume media, interacting with the rapid technological, and social platform evolutions. However I don't feel the industry does enough in staying ahead in attracting graduate talent - I hadn’t considered the media industry as a viable career option until I was introduced to it at Mumbrella360 and GroupM. Personally, the MGrad program was a great first step to increasing awareness and involvement of students given its acceptance of both graduate and penultimate year students, and one which other companies could take note of. Allowing penultimate year students is a stark differentiator of the MGrad program when compared to other graduate offerings - it ensures talent is brought into the business earlier and have already begun training and work whilst finishing their final year of study. Being flexible with working arrangements during their graduate year is key, and one that I’m very grateful the GroupM agency, MEC, is providing to me next year. I would like to see more of the students I study with at least consider having a career in the industry. There are so many passionate and intelligent grads who could have bright futures in media agencies. The problem is they don’t know you exist yet. Jacob Hkeik is currently studying business administration and psychology at Macquarie University
- Project Planning
- Jingle Writing & Catch Phrases
- Music Production
- Sound Recording
- Custom Prop Construction
- Signs & Graphics
- Corporate Identity
- Visibility Strategies
- Press Ads
- 3D Illustration
- Product Prototyping
- Point Of Sale Design
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- Digital Displays
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- Exhibition Design
- Large Format Remote Controlled Banners
- Directory Systems
- Displays & Merchandising
- Retail Displays
- Corporate Signage
- Gallery, Museum Displays
Phone: 1300 969 000
Listing last updated November 25, 2013 | Type of business: Display systems & custom POS
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