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Why the ABC is right to axe Tassie TV production

The ABC is right to reduce its cost base and outsource television production in Tasmania, even if no one likes it. It makes the most economic sense.

The easy response to the ABC’s decision to axe its Tasmanian television production is to criticise it, which is what plenty right up to Stephen Conroy have done. The ABC is supposed to be a national broadcaster, not a Sydney/Melbourne broadcaster. Its presence is disproportionately important in production in smaller cities. And it’s a terrible time of year for the 16 ABC staff who may lose their jobs.

All true, especially the last one for the ABC staff who face losing their jobs. But there’s a very strong case for the ABC axeing its own in-house production capacity where it’s inefficient and replacing it with outsourced capacity.

The ABC is under constant pressure to be more efficient. As the only genuinely national content producer across television, radio and online, with a budget around $1 billion a year including transmission funding, there’s always the view from outside the organisation that there must be plenty of what Richard Alston used to call “back-of-office” savings that won’t affect production. After all, this is a corporation that holds well over half a billion dollars in land and buildings around the country.

The problem is, many of the ABC’s “inefficiencies” are liked, especially by politicians. Regional MPs, especially Nationals, love its network of regional radio stations, each producing at least a few hours of local content a day and sending reporters to their press conferences. And MPs who aren’t in the east coast states have long complained about the centralisation of television production in Sydney and Melbourne, where economies of scale mean production costs are significantly lower. They love the idea of the ABC making television content in Perth, and Adelaide, and Hobart.

But that costs a lot of money. Bit by bit, the ABC has been centralising its own television production in Sydney and Melbourne. It’s also been outsourcing more production to the private sector. For many years the ABC had what one then-executive called a “standing army” of “the best-paid table tennis players in the world”, production staff in centres outside Sydney and Melbourne who weren’t actually doing a whole lot for much of the time.

In 2006, the Howard government, following the successful SBS independent production fund model (SBSi), gave the ABC $10 million a year to run its own commissioning arm for independent production. This enabled the ABC to leverage funding with the private sector for production, increasing the amount of content it could generate and enabling it to cut down on its own fixed costs.

And you can get some idea of the level of fixed costs of the ABC’s internal television production from yesterday’s announcement by Mark Scott. Sixteen jobs would cost the ABC around $2.7 million a year in salaries and admin costs alone, to produce just a few hours of content

All this has to be seen in context: the ABC still aims to produce 75% of its drama content itself. Yet even the limited outsourcing that has happened in recent years has been attacked by the usual suspects. Quentin Dempster called outsourcing a “policy to dismantle and de-skill internal television production” that meant “our creative independence is being crushed out of us along with a conduit for diversity and originality.” The Friends of the ABC demanded an inquiry.

But this hysteria is absurd. Independent production means more local content than the ABC could provide by itself, and more opportunities for creativity and training within the Australian production sector, while the ABC retains full independent control.

If anything, the ABC should be aiming for a significantly higher level of independent production, up to 50% or more. Haven’t we left behind the era when broadcasters were our sole content engines? There are millions of content producers across Australia churning out terabytes of content online every month. As an innovative Australian content producer at a time when commercial broadcasters are under more pressure than ever before to cut costs, the ABC should be looking outside itself more than ever before for content by Australians.

That logic lies behind Mark Scott’s announcement that the ABC would be establishing a $1.5 million (over three years) production fund for Tasmanian production, aiming to attract matching funding from the Tasmanian government, which will support independent production and guarantee that the “Tasmanian stories” that everyone insists must continue to be told, do indeed get told.

The ABC isn’t merely acting efficiently, it’s also meeting its charter obligations, and doing so innovatively and through mechanisms that recognise the changing media environment it operates in. Critics would do well to understand this before bagging it.

And if politicians want the ABC to spend money keeping standing armies of production staff on standby in smaller cities to produce a few hours of content a year, that’s fine. All they have to do is allocate money specifically for that purpose. Then everyone can be happy.

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  • 1
    DAVID SANDERSON
    Posted Wednesday, 21 November 2012 at 2:46 pm | Permalink

    This is a tough but rational and correct decision. Mark Scott has enough credibility now as an expansionary defender of the ABC to be allowed to make these kinds of management decisions in the ABC’s overall best interests.

    Quentin Dempster gets a mention in the article and I would like to query the strength and effectiveness of his
    Stateline program. The current ICAC investigation of Obeid et al is obviously one of the biggest NSW stories for some time but his Stateline coverage has been lacklustre and greatly overshadowed by the(much-weakened)SMH led by Kate McClymont.

  • 2
    citizen k
    Posted Wednesday, 21 November 2012 at 3:33 pm | Permalink

    Bernard’s argument begs questions about why inhouse employees aren’t given more to do. Most would welcome more production activity, much of which can be undertaken at relatively little cash cost given that salaries, facilities etc are ABC resources already paid for (some with decades of taxpayers’ investments). But the real problem is with the idea that outsourcing saves money. Whilst it means the ABC ends up paying a fraction of production costs, the balance is contributed by other investors. The reality is that for the most part those other investors are state and Australian Government screen financing agencies and mechanisms. Take Family Confidential for instance - a fine series once produced in house by ABC TV Documentaries. Now it is outsourced and produced with investment from other government agencies and subsidy via the offset. Its key personnel are largely former (and sometimes current) ABC creatives. In other words what the ABC alone once paid for is now funded with cultural subsidies established and renewed by state and federal governments to support a truly independent sector. Meanwhile that sector remains sadly underfunded, underemployed and mostly underpaid. Many independents are little more than lowly paid outworkers. And the ABC’s intellectual capital goes on being eroded by the gradual destruction of production units that were once repositories of considerable knowledge and expertise, and environments for the development of talent, skills and ideas - that served both ABC and independent production scetors. Outsourcing and inhouse production are not mutually exclusive - they are both important elements of a rather fragile Australian screen ecology. It’s high time that some kind of new “mixed economy” strategy was developed and articulated. Some production (especially that which might not happen because of market failure, and that initiated to meet charter obligations) could remain at least partially in-house. Whilst this occurs now to a limited extent, it’s fair to say that most remaining ABC production staff feel they’re living on borrowed time and that what remains of religion, science and arts units are vulnerable to the kinds of decisions taken in the case of Tasmania. It’s high time that Stephen Conroy, Simon Crean and state arts ministers got around the table to consider whether they’re being conned by ABC management. Isn’t it robbing Peter to pay Paul when the ABC’s production capacity is destroyed and monies from other Government agencies and funding mechanisms fill the gap? And why isn’t the ABC held to account in relation to its charter instead of being allowed to get away with the kinds of arguments about increasing Australian content that, sad to say, even the usually savvy Bernard Keane seems to have fallen for….

  • 3
    zut alors
    Posted Wednesday, 21 November 2012 at 3:51 pm | Permalink

    It appears money is being denied in Tasmania while News24 is propped up.

    Instead, how about scrapping the execrable ‘The Drum’, a programme where journos interview journos about opinion written by other journos. A waste of air time and oxygen - let alone $$$$.

  • 4
    michael crook
    Posted Wednesday, 21 November 2012 at 4:05 pm | Permalink

    If the ABC stopped paying for feeds from the commercial media and newspoll and cut out the executive layer that howard inserted as part of the emasculation, perhaps we could get rid of the new breed of “baby” presenters (and their hairdressers)on ABC breakfast, and have a news programme instead.

  • 5
    GeeWizz
    Posted Wednesday, 21 November 2012 at 4:10 pm | Permalink

    LOL loving the leftwing comments, it’s all Howards fault or Murdochs fault.

    Maybe Tassie is just a bad place to do business and it’s Labor/Greens fault?

    Anyways it was like 2 shows worth, one about auctions which would be better situated in Sydney and another about gardening which could happen pretty much anywhere.

    Don’t worry jobs are headed Tassie’s way now thanks to the Federal Governments “Temporary Pontville Detention Centre, we are gonna close it, pinky Labor promise, iron clad guarantee, we wouldn’t tell fibbie fibs” being reopened to deal with the Labor flood of illegals.

  • 6
    Tom F
    Posted Wednesday, 21 November 2012 at 7:31 pm | Permalink

    Sure, outsourcing saves money. Hasn’t that canard gone the way of trickle-down economics yet?

  • 7
    AR
    Posted Wednesday, 21 November 2012 at 8:31 pm | Permalink

    How many more job applications from BK for Mudorc/IPA flack will Crikey publish?

  • 8
    WTF
    Posted Thursday, 22 November 2012 at 9:09 am | Permalink

    But if Qantas or any other large corporation makes personnel decisions based purely on economics they are disgraceful capitalist pigs.

  • 9
    fractious
    Posted Friday, 23 November 2012 at 5:25 pm | Permalink

    But there’s a very strong case for the ABC axeing its own in-house production capacity where it’s inefficient and replacing it with outsourced capacity.”

    So where’s the evidence that Hobart production temas are “inefficient”? Come to that, what does “inefficient” even mean when as you say, the ABC’s presence “is disproportionately important in production in smaller cities.” Oh, silly me, you’re talking about money, I’m talking about serving and informing communities, my mitsake. I will recite some Ayn Rand as penance.

    Regional MPs, especially Nationals, love its network of regional radio stations, each producing at least a few hours of local content a day and sending reporters to their press conferences.”

    Yes Bernard, the entire gamut of regional content is “sending reporters to press conferences” interspersed with quick tips on making the perfect scone for the next CWA competition. Did it ever occur to you that most of the inhabitants of regional areas are *not* local politicians? But no, you’re right, regional content is “inefficient” and that won’t do at all.

    But [regional content] costs a lot of money.”

    Oh Noes!!! They’re spending cash again, they’re even COMMUNICATING WITH EACH OTHER ZOMG!!!

    That logic lies behind Mark Scott’s announcement that the ABC would be establishing a $1.5 million (over three years) production fund for Tasmanian production, aiming to attract matching funding from the Tasmanian government, which will support independent production and guarantee that the “Tasmanian stories” that everyone insists must continue to be told, do indeed get told.”

    Fail. The ABC is funded by the federal government. Why should a relatively small state like Tassie have to stump up the readies while seeing a significant cut in local content, and the sacking of skilled local workers, and all because you and your neo-liberal mates think regional content is “inefficient”? Let me put this simply for you, so that you get it - it should not be up to the states to make up the shortfall when you and your mates who think Gary Becker walked on water arbitrarily decide one day that regional and local content is “inefficient” (whatever the fucque that means).

    And if politicians want the ABC to spend money keeping standing armies of production staff on standby in smaller cities to produce a few hours of content a year, that’s fine.”

    Please present your evidence that these smaller (I assume you mean regional) centres keep “standing armies of production staff on standby”.

    And you call Quentin Dempster hysterically absurd?

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