Prime CEO: a revenue drought has affected us “substantially” and things won’t be the same
The CEO of Prime Media has told a Senate inquiry that a revenue “drought” has hit Australia’s regional broadcaster and it is difficult to see pathways to growth outside of mergers with metropolitan brethren.
“It is fair to say that in a drought it is the edges of the lake that dry up first,” Ian Audsley, CEO of Prime, told a Senate Committee. “In the television lake regional broadcasters are at the extremities of the lake.
“That drought has hit us already. Three years ago, when I sat here, my company was worth $366m today it has a market value of a $130m. The structural change has hit us substantially.”
Audsley was appearing alongside the CEOs of Southern Cross Austereo and WIN – all of which were appealing to the Senate to pass the government’s proposed media reforms which would allow them to merge with their affiliate stations Seven, Nine and Ten.
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The committee also heard from Grant Blackley, CEO of Southern Cross Austereo, who told the committee the company was “slaves” to its affiliates in terms of commercial power.
“We are really slave broadcasters to those affiliate arrangements,” said Blackley. “It is very hard to obtain our own content from third parties.”
The committee also heard testimony from Seven West Media CEO, Tim Worner, who said the company did not oppose media reform but had concerns this package was “piecemeal”.
Seven has long argued its priority is a reduction in TV licence fees and Worner said it was concerned the committee was not also addressing key priorities such as the lack of tax paid by overseas media companies.
Worner:
“There are more competitors than ever before, there are more powerful competitors than ever before and they are playing under a different set of rules to the ones we are,” said Worner.
“What we are fearful of is a piecemeal approach…what we would be extremely fearful of is something that is done now resulting in a change to the anti-siphoning list down the track.”
“That’s something we should all be wary of, and certainly something the 70% of Australians who rely on free-to-air TV for their sport will be concerned about.”
Asked by Senators if Seven had looked at buying a regional operator in the event the package passed, Worner conceded it had done the math and that Seven buying the likes of Prime Media was “always a possibility”.
Senator James Paterson asked if there has been any planning for such an acquisition, and Worner responded: “it would be irresponsible of us not to. We could be (in a position to buy a regional player).”
