Ten gets aggressive, boosts sales department. Vance Lothringer, the Nine Network’s former sales boss, has taken control of the Ten Network’s faltering ad sales efforts. Ten yesterday announced that he had replaced Shaun James at “the helm at TEN sales as chief network sales officer.” What it didn’t say was that Lothringer has been a consultant at Ten for the best part of a year. Ten’s most recent sales performance in the June half year was less than successful with the Network achieving a share of 28.1%. That was better than a year ago, but not as good as the 30% share in the back half of 2006. That 30% share was also targeted this year for the 12 months, so Ten is looking for a ramp up in ad revenue. Having a program like Thank God You’re Here with its high ratings and revenue figures will help (it wasn’t in the schedule in the first half this year). It was in the rundown in the first six months of 2006 and that did have an impact on this year’s revenue share being lower. The overall ad market was up in the first half and will be at least 7%-8% up in the full year in the best growth for more than three years. Lothringer and Ten’s executive chairman, Nick Falloon are close: Lothringer was Nine’s long time sales boss while Falloon was first at Nine as chief financial officer, then running PBL. While CEO Grant Blackley did the deed, Falloon’s role in the high level switch should not be underestimated. Ten needs an earnings lift, and that comes from higher revenues, and lower costs. The Canwest group of Canada is in the process of assuming legal control over Ten, but still want to cash out. For that they need an earnings boost to justify a sale price around $3 a share. Ten shares closed at $2.55 in yesterday’s sell off. There’s a lot of work to do. — Glenn Dyer

Thank God You’re Here … to interrogate, sorry question, our terrorirst … sorry suspect. Watch the PM cough on the truth: click on the image.

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PBL split put on hold. James Packer’s plans to split his PBL empire into a main gaming related company called Crown, and a media rump called Consolidated Media Holdings, have been put on hold while negotiations over the tax treatment of the cash payout of $3 a share to shareholders continues with the Australian Taxation Office. Instead of the shareholder meetings being held this month, October has been set down by PBL. PBL announced the split in early May with the basis of the deal revealed as: Crown will own a diversified portfolio of market-leading gaming assets, including full ownership of Crown and Burswood casinos, a 41.4% stake in Melco PBL Entertainment Limited (MPEL) and investments in other international gaming assets. Its experienced management team will have significant financial flexibility to drive Crown’s continued investment in gaming assets worldwide. Consolidated Media Holdings (CMH) will hold investments in a diversified portfolio of market-leading media assets including PBL Media (50%), Foxtel (25%), Fox Sports (50%), Seek (27.1%) and Ticketek (100%), with approximately 65% of earnings being generated from high-growth new media assets. The tax forgone in that case would be far more than any drain from the C7 case (which actually boosted tax revenues). Now this is a tax lurk for people to be concerned about. James Packer stands to get around $760 million of the cash distribution, so he has every incentive to get the best possible tax treatment for all shareholders, including himself. Investors would like to know what he will do with the cash: would he use it to inject more capital into Crown? — Glenn Dyer

Is Rupert Murdoch evil?  MSNBC viewers think so…

Stokes lifts stake in The West. Meanwhile, Australia’s surviving media mogul, Kerry Stokes, has taken the opportunity of market weakness to lift his stake in second prize, West Australian newspapers (WAN). A substantial shareholding notice yesterday disclosed that Seven had increased its WAN stake to 17.3%, from 16.1% a month ago. That was when it moved from around 15% acquired last year. Seven took its first stake of 14.9% of WAN last October, before the new federal laws liberalising cross media ownership regulations taking affect. Its increases came after the new laws came into force last April. Seven shares jumped back over $11 rising 29c in the morning to $11.24. That’s back above where it was last Friday after the sell off losing the C7 case in the Federal Court. WAN shares rose 31c to $14.16. And GRD, in which Seven has a dominant 12.21% holding has rejected a takeover offer from Transfield Services which valued GRD around $529 million. Stokes’ Seven bought an initial 10% stake before the offer, and then increased it in the Perth-based GRD after the Transfield approach. Stokes and Seven made it clear they would not accept the offer at the suggested price around $2.75 a GRD share. — Glenn Dyer

Austar report shows why Foxtel wants it. Regional Pay TV operator, Austar showed today why it is so wanted by Foxtel, with a first half profit report and gross margins enough to make a subprime mortgage broker drool. Austar had first half revenue (for the six months to June 30) of $275 million; a rise of 14%. “Gross margin” increased 13% to $148 million. That a margin of 53.9% (it was the same in the first and the second quarters). But you have to wonder why Foxtel didn’t want to pay Liberty Global’s $2 a share ($1.62 today) when faced with those margins. The company also reported higher subscribers; up 38,000 and a 2.9% rise in average revenue per user to $76.36, which is world class. (Foxtel doesn’t release that figure.) Earnings before interest, taxation, depreciation and amortisation (EBITDA) for the six months increased by 17% to $79 million compared to the first half of 2006, reflecting that 13% rise in gross margin to $148 million but only an 8% increase in operating expenses to $69 million. Profit before interest and tax was $50 million for the six months – up 26% compared to the same period in 2006. AUN reckons the long-awaited MyStar personal digital recorder will be available on the final quarter of this year. That means Foxtel will face a competitor for its IQ2 box and higher costs if it takes over Austar after MyStar starts. One of the big cost savings for Foxtel was scrapping MyStar and going with the new IQ2 box across almost 2 million pay TV subscribers, instead of the 1.3 million or so at Foxtel. There was no mention of Foxtel in the profit announcement and Austar said it hoped to have its capital management plans, worth up to $300 million, finalised by the end of the year with the ATP. — Glenn Dyer

Last night’s TV ratings
The Winners: Ten first, Nine second, Seven third. It was Wednesday and Thank God You’re Here and House once again dominated the night. 14 programs with a million or more viewers. Thank God You’re Here averaged 1.829 million, House, 1.571 million, Seven News, 1.437 million, Home and Away, 1.336 million and Today Tonight 1.333 million. Nine’s A Current Affair had 1.293 million and Nine News followed with 1.269 million. McLeod’s Daughters was a touch better at 1.205 million people, while the ABC’s Spicks And Specks eased to 1.190 million at 8.30pm. Nine’s Temptation had 1.187 million, Cold Case was next with 1.175 million at 8.30pm and Without A Trace averaged 1.153 million at 9.30pm. The 7pm ABC News averaged 1.102 million and Seven’s Police Files Unlocked averaged 1.023 million from 7.30pm to 8.30pm. Neighbours languished on 887,000, Futurama , 881,000 at 8pm, The Simpsons repeat at 7.30pm, 854,000. The New Inventors on the ABC at 8pm, 823,000.

The Losers: Losers? Seven’s 8.30pm movie Terminal averaged 861,000, which was around 255,000 more than the previous Wednesday night movie. But it wasn’t competition for House or Nine’s Cold Case/Without A Trace. Seven plans to run more movies for the rest of the year, or does it? It has to fill a hole. It has Kath and Kim (Sunday nights) and City Homicide coming Monday’s, Sunday, Wednesday or Thursday. Ten’s Medium, 959,000 for a fresh ep was below average. 700,000 viewers vanished from House to Medium, a big turn-off: bed perhaps? The Chaser repeats grind on and on on the ABC, 876,000 last night; viewers know it. The Nation, 387,000 at 10.30pm.

News & CA: Seven News won nationally but won Sydney and Perth, Nine won Melbourne, Brisbane and Adelaide. Today Tonight won by 40,000, 98,000 in Perth and 46,000 in Sydney but lost Melbourne by 101,000 viewers. Heavy! TT won Brisbane, lost Adelaide. Nine’s Nightline averaged 213,000. Ten News At Five averaged 843,000, The Late News/Sports Tonight, 419,000. The 7.30 Report, 825,000, Lateline , 293,000, Lateline Business , 139,000. SBS Dateline , 253,000, World News Australia , 185,000 at 6.30pm, 270,000 at 9.30pm. 7am Sunrise , 403,000, 7am Today , 249,000. 9am Mornings Seven, 184,000, KAK on Nine at 9am, 95,000 and 9am With David and Kim , 99,000.

The Stats: Ten won with 27.5% (29.6%) from Nine with 26.4% (25.8%), Seven with 25.5% (22.7%), the ABC with 15.7% (15.6%) and SBS with 4.8% (6.3), Ten was a bigger winner in the zone 1, 6.30pm to 10.30pm. Ten won Melbourne, Adelaide and Perth. Seven won Sydney and Nine won Brisbane (that’s 6pm to midnight). Seven leads 27.9% to 26.1% for Ten and 23.6% for Nine. In regional areas a win to Nine through WIN/NBN with 30.1%, from Southern Cross (Ten) with 26.0%, Prime/7Qld with 25.5%, the ABC with 13.3% and SBS with 5.2%.

Glenn Dyer’s comments: Ten would not like too many Wednesday nights like that: yes it won, but it was a bit skinnier than last week. Thank God You’re Here and House were strong, but everything else was pretty average and Seven was close in a couple of markets, and Nine was closer as well. Tonight Nine will win but will be looking at any further loss of viewers from Sea Patrol. Ten has a bare cupboard and will go backwards over the next three nights. It’s not that worried and has the week in 18 to 49s won, but a second place ahead of Nine isn’t to be laughed away. It’s a nice feeling and would make the job of new sales boss at the Network, Vance Lothringer (who was sidelined and then shafted at Nine where he was kingpin), a little easier. He can be a tough taskmaster. Ten especially has a lot of work to do in the Sydney market. Seven got close in Zone 1 (6pm to 10.30pm last night) and actually won the all people from 6pm to midnight. Ten was much stronger (and Seven was weaker, and Nine stronger) in Melbourne.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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