Advertising behemoth Harold Mitchell has made the BRW Rich List
by simultaneously remaining close to Australia’s media moguls whilst
convincing major advertisers he can screw the best deal out of his
mates. In a global advertising buying environment populated by multinationals, the
dominance of the independent and privately owned Mitchell &
Partners in Australia is unique in the world.
This makes Harold’s views on media ownership interesting, something that Alan Kohler cottoned onto in The Smage today after reading the Mitchell & Partners submission to the media laws review. Try these lines from Kohler for size:
Mitchell’s key conclusion is that FTA TV and radio — especially TV — are
under significant threat from new media and will have to find new revenue
streams. His worst case forecast is for the three commercial networks to go from
a pre-tax profit of $600 million this year to a loss of $600 million in 2014.
“This would clearly be unsustainable and the commercial FTA television industry
would be decimated,” he says.
Mitchell’s more likely model is: TV audiences continue to decline by
1.5% a year, reducing revenue growth from 6% to 4.5%. Pre-tax profit of
the networks dips to $250 million in 2014. Still a bit decimated, I’d
In his introduction, Mitchell makes an interesting point about the impact of
the internet on journalism: “There is little published in the traditional media
that can’t be found on the net. On the other hand, there are many news stories
that can only be found on the net.”
Read the full Mitchell & Partners submission for yourself here.
Given that Harold has a big internet play running through his family’s
36% owned Emitch, which is now capitalised at $151 million, it is not
surprising that he is fully signed up to the internet revolution.
In fact the man who helps run Emitch, Stuart Simson, probably
contributed significantly to the submission as he helped produce this excellent Productivity Commission report into broadcast media which was released literally as the dotcom bubble was bursting back in April 2000.
Sadly, the Howard Government chose to ignore most of the recommendations in order to keep the moguls
happy, something it’ll probably do again this time.