The media consolidation is coming – and the deals have probably already been done
The coming wave of media consolidation could push Ten into the arms of News Corp, Seven into bed with Fairfax Media and Nine with WIN, predicts Mumbrella’s Tim Burrowes
A long while back, I had lunch with the father of an English Premier League footballer. He confided that his son would be replacing my club’s top striker.
None of this had appeared in the transfer-obsessed tabloid sports pages. And nor did it for several months. But the transfer eventually unfolded in exactly the way he told me it would.
It was eye-opening to realise just how far in advance top level deals are stitched up.
All very interesting. Additional context to #2 – stories were SWM was going to buy a stake in Domain not that long ago. If SWM buy FXJ then they could dissolve their digital partnership with Yahoo too.
Anyone who media consolidation is all in the name of “free media” or “free market” is kidding themselves. This, if anything, will make it harder for smaller players to establish themselves in the media landscape. It will become more the plaything of billionaires than it already is.
I really hope there are some visionaries out there who figure out and pursue an online only business model across print, video and audio – and who do not sell their stakes to the established media giants.
As if Murdoch didn’t absolutely dominate Australia’s public debate now with his 65% of metropolitan daily print circulation! And the catastrophic effect this has had on Australia’s democratic processes, with all important issues being passed through the Murdoch self-interest filter before reaching the public debate.
I guess we could stand to save a lot on electoral costs. Simply scrap the election and send the two candidates over to Rupert’s court in NY, and let him choose. Scrap the middle-man, the Australian electorate.
all bad news for us working in the industry and the population at large.
I saw some senior ch7 staff at Fairfax back in early 2013.
The News/Ten deal is as good as done, you forgot to mention that the sales team will be merging with MCN (they have just cleared half of their sales floor).
Not good for journalism or “Free Press”
it also makes crystal clear why the bolt report is still on Ten despite being a commercial and ratings failure and alienating Ten’s core audience.
Oligarch indeed…
More likely that TEN would purchase WIN (given Bruce Gordon’s stake in TEN) and Nine would purchase Southern Cross. Most importantly it would be a great way to get more Australian content into regional markets if they allowed other players to access capacity. It’s not so much about relaxing the rules but about encouraging new players. Perhaps community television (the quality community channels like the one of Foxtel) can pick up the slack of local content.
Rupert might well fit up Lachlan with a nice new empire. But IMO that would not be a great place to be if you’re a shareholder. It’s possible that a consumer recovery would buoy up ads, but those print businesses look to be crook. And then there’s TEN.Doubt that Nine would want to bulk up, but they – or Seven – might do well to get into content via a company like Freemantle. As for Fairfax, it’s hard to see how they present value. The big assets and brands are unwell – even the AFR appears to be trading poorly – the regionals are showing serious signs of stress and the radio acquisition is looking like an albatross. Doman is not the independent entity it’s being touted as.In fact I think Hywood is a bit desperate for a deal to bale out before his spinning plates wooble too far.
I want to see Netflix et al loose in this market. Then we can really see what’s what.
@ Media Buyer
As I understand it the ‘new improved’ Bolt Report is entirely funded by News Corp (host, production…everything) yet broadcast on Channel 10.
Surely the News Corp / Channel 10 nexus must be sailing very close to the wind with the current cross-media ownership laws? With Lachlan’s dual positions in either organisation and the close co-operation on resources.
No wonder Malcolm feels a need to ‘reform’ our cross-media ownership laws. No prizes for guessing who will be the major beneficiary from this. Hint…it’s not Australia’s democracy.
TEN will become FOX
The Ten News deal is done & was one of Abbott’s costs of admission. Be interesting to see how Malcolm rationalises it.
Not a good time to live in this country.
If News are going to buy Ten then it might be a good time to buy Ten shares … they are now around 30c but when LM got involved they were at $1.50+
There’s no way News buying Ten at or even remotely close to the current share price would be allowed – it would need to be close to the value it was when LM got involved otherwise it would raise a lot of questions. Ten could be a decent speculative buy at 30c to see if a takeover eventuated and if so, at what price. Could be a chance to get 2-4x with no real risk.
I thought I read all this in Margaret Gee’s media guide? Sorry did I just regress back to 1983? The more things change…
So Tim,
By giving us your EPL anecdote are you saying you are “in the know” as transfer deadline day twitterati put it, or are you just speculating?
I’m suspecting/hoping for the latter. Suspecting because I can’t see why a sane person would want to buy any of those businesses (mitigated but Rupert having a history of being willing to lose money if it gives him more power) – and hoping because if they do that’s a black day for Australia.
Hi Hugo, as I mentioned in the piece – 100 % speculation on my part.
Cheers,
Tim – Mumbrella
Brilliantly put, Bob Smith.
I do think it’s funny that no one is batting an eyelid about the Seven + Fairfax. Surely that’s the one people should be worried about.
Good article Tim, depressing as the prospects are of even more media consolidation in Australia. I can just see all those glowing reviews of shows across media owned by the same parties and politicians ever more compliant to the media bosses’ self interest. But as for Ten. Is Rupert going to put a fatherly arm around the shoulder of his son Lachlan and tell him he is just not cut out for television, sack all his appointed executives and keep him as far away as possible to rebuild Ten? And are those other major shareholders such as Gina, James et al going to swallow their huge losses or hang in for the rebuild which may never come? If everything you postulate happens Tim then once the government emasculates ABC funding the circle will be complete.
But what about the New Zealand arm of Fairfax?
Meanwhile Google will keep eating everyone’s lunch whilst the traditional media sector keep feeding on themselves like fat (yet ever shrinking) grubs.
And what does it all mean for us the news readers Tim?! Please tell us more… it doesn’t sound good but I’d love if you can spell it out for us.