If the ABC is going to be a harlot, we
should at least hope that she will be a smart one.

An ABC watcher with a close knowledge of
Aunty’s commercial affairs has written arguing that the ABC needs to think
creatively about how to generate additional revenue in ways that are compatible
with its charter – but that taking income from ads on third party sites, as
suggested in this story last week, may be just plain
dumb.

ABC acting managing director Murray Green
last week failed to deny rumours that the Board will this week consider a
proposal to licence a website to stream ABC archival content in return for a
share of advertising revenue.

The ABC watcher points out that taking
advertising income for video streaming, without any accompanying substantial
license fee is not only risky, but depends on providing content exclusively.
This means the ABC loses control over both its content and the returns. It
would be a much worse deal than that contemplated with Telstra in 2000. That
deal would have included a base fee for controlled access to selected content,
no exclusivity, and options to renegotiate later.

But if the rumours are correct, the current
deal would give the ABC no return for the embedded value, brand, investment or
content. “It is a bit like agreeing to a
divorce settlement with a variable allowance without taking a percentage
of the value of the house…the ABC carries the risk and doesn’t maximise the
return, to continue your analogy a bit like being half pregnant and likely to
deliver a premature baby…” says the ABC watcher.

Peter Fray

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