If the thought of a new kid on the block doesn’t give the other TV
channels the jitters, it should writes Terry Television, especially if
Sam Chisholm is lurking somewhere in the background.
Let’s be frank, despite the talk, business people just don’t like
competition. In fact they go out of their way not to compete, except
when forced to by pesky shareholders, and well, competitors.

And despite the appearance of a very competitive commercial television
industry in Australia with three full commercial channels going at each
other and the half-born SBS there sucking away some of those ad
dollars, there’s nothing like talk of a new competitor to bring the
worst out of the existing players.

We’ve seen it with Pay TV (although Foxtel is its own worst enemy with
its grandiose claims, but delivering little) and we’ve seen it with
multi-channelling.

No outsiders please, we’re in a nice cosy oligopoly, making nice fat profits, and we don’t want to share.

So when there’s talk of a fourth commercial TV network, as we have now,
the wagons are turned, the laager is formed and the pre-emptive arrows
fired in the general direction of the intruders.

And, there’s no one better placed or skilled at drawing their fire than
John Singleton. He’s done it many, many times before on behalf of
defenders and invaders who have been his clients.

Now he’s taking on the trio of established players in Nine, Ten and
Seven, and they’ve replied with all manner of the usual warnings along
the lines of not enough money, Australian production will fall, costs
will rise and we’ll all be ruined!

Well, Singleton’s associate, investment banker, Mark Carnegie fired a
few shots of his own this week at the annual ABA conference in
Canberra, accusing the big three of overstating the problems, and
spending little on Australian production, despite claims to the
contrary. He said the trio spent only $80-odd million on Australian
content last year, compared to the billion dollars or so in profits
they earned.

Carnegie says the John Singleton-backed idea for a fourth channel would
be restricted to Australian content and Mr Singleton thought it would
make a lot of money.

And who was first to fire the public arrow at that invasive thought?
Surprisingly the new boy in teleland. Nine’s David Gyngell, who leapt
into print for the second time this week to say he doubted Mr
Singleton’s assertions about making money.

In a small story in the Sydney Morning Herald Friday, Gyngell said,
“John Singleton is a very capable advertising executive. That doesn’t
mean you know anything about Australian TV… I don’t think you can set
up an all-Australian channel … I don’t believe that consortium or any
consortium has got deep enough pockets.”

He said he believed the market was too small to sustain another player.

Well, Dave, with three billion or more in annual revenues and profit
margins around 30% or more, there’s a lot of fat there for a nasty, low
cost or high cost niche player to arrive and cherry pick your viewers
and those from Seven and Ten (and the ABC for that matter) with good
local product.

And, remember Dave, Sam Chisholm, who is no doubt mentoring you as you
learn about teleland, is no doubt somewhere there involved with
Singleton in floating the idea, and he DOES know TV.

One thing Sam, John, Mark etc know that once you have a licence, IT
becomes the asset, and you can do an awful lot with it. Just take the
way the licences of Nine and Ten have been traded and flicked between
big, powerful (and sometimes poor) people since the late 1980s.

It’s not the network idea that’s the attraction. It’s the licence Dave
and Singleton DOES have people around who understand the difference.
Otherwise why has Singleton made Radio station 2GB into a nice money
earner, Alan Jones and all?

Peter Fray

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