Extortion and estimates. Your correspondent traditionally rather enjoys estimates, when the chiefs of the ABC and SBS are hauled before a Senate committee. There’s a certain amusing culture-wars quality that rears its head whenever Coalition MPs get the chance to dig into the ABC, but last night’s performance was, well, rather tedious. Senator Cory Bernardi wasn’t even there for most of it!

Anyway, the ABC’s Mark Scott and SBS’ Michael Ebeid were due to address the committee on the morning of Whitlam’s death, but that threw everything into disarray, and so their grilling was postponed till last night. A lot’s happened to them in the intervening period. Communication Minister Malcolm Turnbull announced budget cuts, and the broadcasters said they’d respond on Monday. But the Senators grilling them wanted an answer now. Scott gave nothing away, studiously refusing the “can you rule in or out?” game that led him to announce the potential axing of Peppa Pig last time. Ebeid had a prior commitment, so he sent his director of corporate affairs Peter Khalil to answer questions in his place. Khalil was a bit more obliging, telling the committee he didn’t anticipate the organisation would be making any cuts to programming as a result of the budget cut, as it believed it could find efficiencies in its back office.

Senator Sam Dastyari had an interesting line of questioning about the legislation regarding SBS’ more flexible advertising. He secured, from Senator Mitch Fifield (there representing Turnbull), guidance that the government planned to introduce the legislation to amend the SBS act in the first quarter of next year. This would go before the Senate, where the cross-bench and other parties will decide whether it passes. But, Dastyari mused, a failure to give SBS the ability to increase its advertising in prime time would result in it not being able to recoup almost half of the funding cut it received on Wednesday. So really, the non-government senators had a choice of either supporting more ads, or saddling an already lean organisation with greater budget cuts.

Senator Scott Ludlam, for the Greens, was not impressed. “That’s extortion — I think we can see where this is going,” he said.

Both Scott and Khalil revealed a little more about the Lewis Review, but only under persistent questioning. Khalil said it was a department report that recommended a lot of things SBS was already doing, while Scott said it would cost more (mainly in redundancy costs) to implement its recommendations than could be saved by implementing them. Both insisted the review contained commercial-in-confidence elements they wouldn’t want publicly released. As a general rule, Scott played up the impact of budget cuts while Khalil said they’d have only a minimal impact on SBS. This is in keeping with the general approach of the two broadcasters this year.

Turnbull has said he’ll write to the ABC board suggesting they split up the managing director and editor-in-chief roles. Scott defended his role as “editor-in-chief”, saying that while he didn’t and couldn’t personally approve everything that went to air (the way, he implied, Chris Mitchell did at The Australian), he was nonetheless personally accountable for it. Asked, if the the roles were split, which position he would prefer to hold, he dodged the question. — Myriam Robin

Fresh blood. Despite the doom and gloom, the ABC is hiring. It’s recently added nine youngsters to its cadetship program — the survivors of a field of applicants that originally numbered 450. For the next year, there’ll be a cadet learning the ropes in every capital city, and an extra one in Darwin.

Steven Alward — the ABC’s editor of policy, training and staff development — told Crikey the cadets will join Aunty in February, where they’ll be first put through a week of “intensive training” in multi-platform reporting, editorial policies, media law, news-gathering tech and personal resilience.

Hopefully, by the time they turn up, the march of people clearing out their desks will have subsided. Crikey understands the ABC will cut 500 jobs as a result of the budget cuts — a full staff announcement is due at 11am on Monday. — Myriam Robin

Sack the lot of them. But not everyone is satisfied with the cuts. The Australian thinks a few more people should be turfed out, writing in its editorial this morning:

“It is now incumbent upon the board and management, including Mr Scott, to accept the minister’s intervention over efficiency, accountability and editorial direction, and to act on it. If the ABC does not, the minister would have no other option but to remove the board and put in place a team that will.”

Rundle turns Tory. I am a typical decadent Englishman who could not live without the New Statesman every Friday and The Guardian every day, said George Orwell (a lot better), talking about how something or other was impossible. Everything, I think. But anyway, even St George would surely have balked at the new layout of the paper he loved to hate. I know we have a go at the old blue lady now and then, but we’re speaking now as a reader. It’s awful.

Seriously, it’s not just me is it? It’s a shocker. It’s high on blank space, and low on information, but it doesn’t look relaxed, merely badly laid out. The serif font is too frail for the colour background, the leading is too wide in the text blocks, and what’s with the text bumping up against the top and left borders of the boxes? Have I missed some retro craze for Quark 2.0 self-publishing? Everything looks randomly positioned.

True the old Guardian layout was cluttered, and overly newspapery. But this is ridiculous. How ridiculous? Well, unless you were going for something really post-Gutenberg, you want something semi-newspapery. Which means clean space, accessibility and a degree of upfront information and that’s been done by:

Yes, the Torygraph, the go-to daily for the last retired colonels of Tunbridge Wells. Simple, easy-on-the-eye, information rich, and with many, many links. Is that so hard? And who signed off on that damn Guardian site? Or is it just me? — Guy Rundle

A friendly Foxtel bailout. Very soon we will finally learn details of the Foxtel-led bailout of the Lachlan Murdoch disaster (AKA the Ten Network) by a family company and a friend: Foxtel is the family company, and the friend is expected to be the John Malone-controlled US cable network Discovery Communications. It will be there to make the deal look palatable and stop it looking like a bailout of Lachlan Murdoch by shareholders in Foxtel and News Corp, as well as Telstra, the other 50% partner in Foxtel. It’s rumoured Foxtel will buy 14.9% of the shares (that’s the most it can under current media law) and that Discovery will buy the rest, including Lachie’s 8.4% stake in Ten, which, like all shares in Ten, is very much diminished.

The plan is that once the federal government has changed the media laws on ownership restrictions (which won’t be for years, given the way Prime Minister Tony Abbott has run away from the issue) Foxtel will either equalise its stake in Ten with Discovery to 50%, or buy it out completely. But first the ACCC will have to rule on such a deal. Foxtel CEO Richard Freudenstein has been lobbying the key media regulator ACMA for that reason.

But before we get there, perhaps all concerned could turn their attention to one nagging detail in the disclosed Foxtel accounts. It’s the peculiar 12% interest rate on a loan to Foxtel from its shareholders, Telstra and News Corp. The loan, which stood at US$902 million at June 30 this year, was part of the financing of the Austar takeover (which cut the level of competition in pay TV in this country) several years ago. The loan is in the form of “subordinated shareholder notes”.

But it’s the 12% interest rate which beggars belief, especially as the same Foxtel accounts (contained in the latest News Corp 10K annual report filing with the US Securities and Exchange Commission), reveal that the pay TV group pays as little as 3.68% and as much as 7% on around US$2 billion of other debt. So the loan, and the huge margin over the interest rates on the rest of Foxtel’s debt, raise serious questions about the high 12% rate on the shareholder loans — that is simply too high and appears like a tax minimisation scheme, and not a normal, rational commercial transaction. — Glenn Dyer

Problem solved. The good folks at our two public broadcasters were amused to find their annual budgets had increased fivefold. And yes, Hadley has started writing his columns in dot points …

Front page of the day. Just a touch of gloating from the SMH.

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Peter Fray
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