BotW: Still waiting for the government (and Jetstar); Domain manoeuvres; The scorpion and the frog
BotW: Still waiting for the government (and Jetstar); Domain manoeuvres; The scorpion and the frog
Welcome to Best of the Week, mostly written at Sydney Airport awaiting Friday’s 6pm departure of Jetstar’s 2.55pm flight home to Tassie. That’s how they (don’t) roll.
Today: More shenanigans at Nine; the indies have their say; and Seven, the same old scorpion.
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Publishers await their Independents Day
While Australia’s smaller publishers gathered in Sydney on Thursday afternoon, the government was allowing another Parliamentary sitting week to drift by without moving forward on its media reforms.
The shop being talked at the Independents Day party was the question of how much longer Treasury minister Stephen Jones will put off a decision on whether to designate Meta under the News Media Bargaining Code.
And the shop being talked by communications minister Michelle Rowland at doorsteps and a press conference was various versions of the empty phrase “in the fullness of time”.
Forever, is one of the emerging options.
Most crucially, the Cabinet appears to have still been unable to reach agreement on reforms to betting ads, which will need legislating. There are now just 15 Parliamentary sitting days in the calendar until the end of the year - three in October and 12 in November.
The growing expectation among publishers is that the government will not designate Meta, instead edging towards a digital levy on the platforms, and wrapping its various reforms together. If a digital levy happens it could fundamentally reshape the business model of public interest journalism.
But all the changes - if they happen - will be interconnected.
The dithering is already weakening the position of publishers currently renegotiating deals with Google. The message they have been taking from Google in recent meetings is that although it is willing to give them some money in another round of deals, less is on the table than last time round because Google no longer fears designation under the News Media Bargaining Code. Not in so many words, but effectively, take it or leave it.
Things have been getting smellier around Google in recent days. The antitrust trial in the US has been putting on the record all sorts of allegations of anticompetitive behaviour which has hurt publishers around the world thanks to its stranglehold on the programatic advertising chain.
In one delicious email which came to light in the trial, a Google exec wrote: “Is there a deeper issue with us owning the platform, the exchange, and a huge network? The analogy would be if Goldman or Citibank owned the NYSE.”
On the stand, the same exec claimed his email was merely “late night, jet-lagged ramblings”. We’ll see whether the judge buys that.
This month, YouTube held its annual pitch to Australian advertisers, Brandcast.
At last year’s event they used questionable stats from their own survey to back up boss Mel Silva’s (as it turned out, successful) pitch to take more dollars from the local TV players. The image above which I shared from last year’s event at the time, kicked off something of a shitfight with the networks challenging the accuracy of the stat.
I wasn’t invited back to this year’s Brandcast.
Meanwhile, the publishers at Independents Day, which was organised by the Digital Publishers Alliance, were mostly polite about Google, which was one of the event’s two sponsors.
AusBiz founder Kylie Merritt didn’t hold back though. “In another time, it would all have been funded through advertising, but not today. We don’t know for sure because they are not particularly transparent about it, but it’s estimated that the big tech platforms are hoovering up about $15bn in advertising each year in Australia, 70 or 80% of the digital ad market. It’s the same around the world and it’s led to the decimation of traditional media.
“In publishing, the number of journalists has halved in recent years. Will it change? Possibly.
“My sense is that the tide might turn but it will take years, and we can’t wait.”
At the moment, all the government seems to be doing is waiting.
Nine promises ‘sharper focus’ on Domain via a remarkably unfocused intervention
The Domain Group kremlinology moved up a gear on Thursday.
What could have been a routine move took on extra significance thanks to Nine’s accompanying communications.
Mickie Rosen, a Nine board member since the Fairfax takeover in 2018, will be added to the board of Domain, to replace outgoing Nine boss Mike Sneesby.
So far, so routine. Nine owns 60.1% of Domain. Of course it would want to retain its influence on the board by replacing Sneesby.
More curious was the accompanying statement proactively emailed out by Nine to journalists three hours after the announcement:
“Mickie Rosen's appointment to the Domain Board reinforces Nine’s sharper focus on Domain, noting acting Nine CEO Matt Stanton also is a Director of Domain. Nine is continually discussing with Domain options to explore how the two groups can work together for mutual benefit. Having both Matt and Mickie on the Domain board will support this goal.”
A couple of weird things about that.
First, the pointed phrase “sharper focus” can really only be taken as an implicit criticism of somebody.
But who? Are they saying Mike Sneesby lacked that sharp focus when he was representing Nine’s interests on the Domain board? That seems remarkably brutal if so, considering Sneesby is still technically Nine’s boss for another nine days yet.
Or is it a criticism of the Domain management - either chairman Nick Falloon or CEO Jason Pellegrino?
It follows the odd pre-results attack piece on the Domain management in Nine’s Australian Financial Review a month ago. Nine is sending a lot of friendly fire in Domain’s direction.
There’s also another unusual aspect to that Nine statement about “having both Matt and Mickie on the Domain board”.
Nine also has a third representative on the Domain board - chief product and technology officer Rebecca Haagsma. Haagsma was one of Sneesby’s lieutenants, having previously worked with him at NineMSN earlier in her career before rejoining him at Nine from Telstra. Did the company forget about Haagsma when it put out that statement, or was omitting her an even more pointed criticism?
The most benign interpretation is error. Almost as benign is the possibility that somebody at Nine is merely making clumsy attempts to talk up Domain’s share price by suggesting that more focus will boost profits. Domain makes up more than half of Nine’s market capitalisation, so an improvement in Domain’s market cap would boost Nine’s too.
Least benign would be the interpretation that there’s a quiet war going on for control of Domain.
Maybe even more than Stan, Domain is the most significant bargaining chip Nine possesses. With a market cap of $1.8bn, Nine’s stake in Domain makes up 57% of its overall valuation. Nine could sell a chunk of that to a strategic partner to raise funds to buy an outdoor company or Foxtel, or it could sell off its part of the business altogether.
But while Domain remains separately listed, Nine doesn’t have day-to-day control. It has only three directors on a board of eight. And chair Falloon, who lost his seat on the Nine board two years ago, will no doubt be fully exercising his independence.
The next Domain annual general meeting is on November 6. It will be worth watching.
Same old Seven
There’s a pivotal scene in the British movie The Crying Game where a hostage tells his captor the parable of the scorpion and the frog.
The scorpion, needing to cross a river, begs the frog for a ride on his back. The frog demures, scared that the scorpion will sting him. But after scorpion points out that if he did that, he would die too, the frog agrees.
Half way across the river, the scorpion stings the frog anyway, dooming them both. “But why?” asks the frog. “I can’t help it. It’s in my nature,” replies the drowning scorpion.
Which makes me think of the Seven Network, which indulged in another bout of mutually assured destruction this week.
On Monday, Paramount announced as part of its 2025 Upfronts that it will bring reality series Big Brother back to Network Ten.
Seven, which previously aired Big Brother, in a cheaper, non-live format that faded in the ratings, immediately went legal, TV Tonight revealed on Wednesday. It will hold production company Endemol Shine, the owner of the Big Brother format, to an obligation not to work on the show for anybody else until well into 2025.
That’s Seven’s legal right. And it’s entitled to enforce its rights.
But why?
Australia’s free to air networks have been stuck in a negative spiral as they struggle to move the conversation on from falling linear numbers to working together to take on the likes of YouTube in the bigger ad-supported streaming space.
Ten’s Big Brother recommission created buzz around television generally. It was a positive story for Paramount with no downside for Seven. Indeed, the noise around the show’s 24 hour livestream benefitted the whole sector. It’s perfect FAST (free ad supported streaming) content.
Seven could have been magnanimous and left it alone. Or even privately told Endemol Shine that it felt disrespected.
Instead, Seven went after its rival anyway.
This is the Seven West Media whose proprietor Kerry Stokes bankrolled the failed defamation action by war criminal Ben Roberts-Smith against Nine.
And the Seven West Media that provided rapist Bruce Lehrman with accommodation while he failed in his attempt to sue Network 10 for defamation.
Even with a new CEO in Jeff Howard, it’s the same old Seven. If it sees an opportunity to hurt a competitor, it will take it, even if it damages the whole sector,
There’s no upside for Seven in going after Ten. Any advertising dollars Ten misses out on will not be reallocated by advertisers to Seven instead. They’ll disappear away from the TV sector altogether.
Seven can’t help itself. It’s in its nature.
Ooh Moves back above $700m as SCA loses more ground
Ooh Media’s market capitalisation moved back above $700m on Friday with an improvement of nearly 2%.
Meanwhile Southern Cross Austereo’s price fell even further, losing another 5% to land at a market cap of just $113m. The company has now lost 18% in the last month and more than 50% over the last six months.
The Unmade Index fell slightly, losing 0.17% to land at 441.7.
COTW: Specsavers at the airport
In each edition of BotW, our friends at Little Black Book Online highlight their Campaign of the Week.
LBB’s APAC reporter Casey Martin writes:
TBWA\Melbourne have put their own twist on the cliched romcom running-through-the-airport scene. The Specsavers campaign sees a hapless hero racing through obstacles, only to find himself on the wrong set of stairs.
The campaign is backed with an out of home campaign featuring the wrong location. Accompanied by the “Should’ve gone to Specsavers” slogan, the billboard tells Sydney arrivals: “Welcome to Melbourne”
In case you missed it…
On Monday we discussed the reverberations of the exit from Nine of Mike Sneesby:
On Tuesday we reported from the Paramount Upfronts, while sales chief Rod Prosser and content boss Daniel Monaghan joined us on the podcast:
On Wednesday we discussed the reverberations of the exit from Mutinex of Mat Baxter:
On Thursday, we asked why agencies are struggling to crack the creative briefs of selling the benefits of AI prodcuts:
On Friday we focused on the small changes the industry could make around alcohol
Time to leave you to your Saturday.
Abe Udy, Cat McGinn and I will be back on Monday with Start the Week
Have a great weekend.
Toodlepip…
Tim Burrowes
Publisher - Unmade
tim@unmade.media
