Hugh Marks, the CEO of Nine Entertainment, talks about the media event in Canberra, where executives have gathered to push for media reform
Introduction – Why are media executives visiting Canberra?
Ross Greenwood: Welcome back to Money News right around Australia. I was telling you earlier on about the gathering of media executives that is taking place in Parliament House as we speak, now the reason for that is because there is finally consensus among media executives in this country to try and seek change in the way in which media laws operate. For many years it has been considered that what you see, the way in which you interact with media companies should be changed. Mainly, because there have been restrictions on the way in which they’re able to take each other over, in the way in which they’re able to distribute information through our community.
While you did not have a very flourishing social network and even an online network that might have been okay, but right now when the two big monsters of media in Australia are Facebook and Google, and Amazon is coming which will be as equally as powerful, what you’ve got is a situation where media companies in this country create pay-for-content which traditionally they would have had advertisers and sponsors against, but that now is being picked up and being distributed by the likes of Facebook and Google you see it every day when you do a web search.
As a result, they are gaining advertising dollars for the views that they are achieving through their own sites. That’s the reason why the media company executives finally are agreeing in regards to change to media laws. Mitch Fifield I spoke to earlier on the program, but let’s get one of my bosses, I’ve got many of them I’ve got to say, the chief executive of the Nine Entertainment Company, Hugh Marks who is in Canberra right now. Hugh, many thanks for your time.
Interview with Hugh Marks, CEO Nine Entertainment
Hugh Marks: Hello Ross.
Ross: This is historic what is going down in Canberra tonight. Normally, if a group of media executives get together there’s more likely to be a fight than a feed, but right now there seems to be a consensus amongst the executives, why has that taken place?
Hugh Marks: I think it’s the recognition as you said Ross, that we are the people in this country that actually are the ones that create the content that people consume. The things that people watch, the things that people rely on for their news and information, entertainment, live sport, etcetera. We’re in an environment where we’ve got these big international competitors, we’re sitting in an environment where we’re regulated and they’re not. I think the future is bright provided we get the right regulatory framework which means we can compete on a level playing field.
Ross: The things for people to be worried about in this country say, for example, sports rights is a pretty important one. We know certainly there’s pressure on media companies, there’s also pressure on sporting bodies, they’re got demands from players as we speak. That’s a key one that affects everybody, it doesn’t matter if it’s AFL or cricket or NRL, whatever it might be.
The truth of the matter is at some point if say, for example, a big international media organisation decided to try and enter the field to buy sporting rights in this country the truth is they could blow everybody out of the park, couldn’t they? And that’s one of the reasons why local media companies have got to be very careful in the way in which, not only they negotiate their sports rights, but also that competition doesn’t cannibalise what you’re already buying and paying for.
Hugh Marks: Again, it’s the level playing field. They could and the point is that they’re unregulated and we’re regulated and all of this is about is just creating a different environment where we’re competing on the same level playing field. Fights will break out tomorrow between the media companies, but tonight everyone is of a unified voice.
Ross: In terms of that unified voice and also the changes that are being proposed by the government right now they still need to find their way through the Senate so part of the reason why you’re all pitching collectively, David Koch hosting, all that type of thing, trying to have this united front it really is all about trying to get to those independent senators and potentially, Pauline Hanson being one of the most important of all of those, to convince them that this is the right way for Australia to move.
Hugh Marks: Yes, everyone is here to show that there is unity, and unity is rare, and unity is not an opportunity miss. The reason that unity exists is it’s all about local jobs and local content. Various interviews I’ve done today, local producers, directors, presenters, makeup artists, these are the people that we employ on a daily basis and these are the people that rely on having a vibrant industry and the extent that we are regulated and the international players are not, all of those jobs are put at risk. Now, I’d be saying to everyone in the Senate think of this moment now as an opportunity where you have a unified media to say, “This is an investment in all of those people’s employment in the future.”
Ross: You and I have had this conversation in the past and that is, say, for example, there is a chief financial officer of a big company that spends money on advertising and a Google comes along and they say, “We can guarantee we’ll get you these many clicks, this many eyeballs, if you put your money with us.” If a radio station, a newspaper, a television station comes along and says, “Spend your money with us. We can’t exactly promise how many clicks you’ll get, but we’re going to get you a big audience,” it’s a really uneven argument in same ways given the fact that much of the content that, say, a Google will be producing is actually coming from the established media players in the first place.
Hugh Marks: That’s right Ross. We as the Nine Network of which you are a part, we do 200 million video views on Facebook every month. At the moment Facebook prohibits us from making any revenue from those views, now they make revenue by putting ads around our content, but the good news is what people engage with is the local content. We will make money into the future based on our ability to be able to fund and produce that local content that people want to watch and engage with. And if we do that, then we have a bright future. Again, all of this debate is just about creating that level playing field of regulation.
Ross: Just one other aspect of this, because I know that you’ve made big pitches to many of the big media and advertising buying agencies, I’m certain that every other chief executive and ad sales manager for radio, for television and all the rest have done exactly the same thing. Do you believe that it’s starting to cut through with the advertising buyers, the product, and also this argument that you are better off going to the source of the content as distinct from the redistributor of the content? Do you think that’s actually having any sway in the markets right now?
Hugh Marks: I think there are two things. Yes, those are absolutely having sway, but I think as media business as well we need to adjust our model so that we can start to realise that actually, it’s okay for us to distribute money across Facebook, YouTube, our own platforms as well as television. We’ve just got to get very smart at the way that we monetize that and again it will be that content that actually people stop, look at, listen to and engage with as opposed to the stream and the feed of stuff that gets fed to you by Facebook or YouTube. It will be that content that will win so I’m very supportive of the government’s efforts to provide this regulatory change that is really an investment in the future of our media industry.
Ross: Great to have you on the program, the chief executive of the Nine Entertainment company, Hugh Marks. I’ll let you get back to the chatting and the conversation with the senators in Parliament House in Canberra and I appreciate your time on the program here this evening.
Hugh Marks: Don’t worry Ross, I’ll start fighting on Nine’s behalf tomorrow.
Ross: There you go, Hugh Marks there thank you so much for that one. Plenty of fights around the place in media, on that subject, what I’ll do is I’ll pick up a couple of the other people who have been there today and presenting. One of them is Greg Hywood who is the chief executive of Fairfax Media which of course is also the largest shareholder of this radio network, here is just a little bit of what he had to say a short time ago.
Greg Hywood: This nation has one of the most restrictive media laws regimes in the English-speaking world, outdated, outmoded and increasingly irrelevant. We are united in our plea to let this industry compete from a position of strength and equal opportunity. To be allowed to take advantage of all the opportunities that should be available to us, to have the flexibility and agility of our global competitors, to be leaders and not followers.
Ross: That there is Greg Hywood. Let’s now go to the chief executive of the Seven Network, Tim Warner. Now, there is a back story here. Of course that Tim Worner has not been seen in public for many months in regards to other aspects of his life that have been played out in courts and other places. He has appeared at this presentation in Canberra this evening, he, of course, spoke nothing about those other matters. Let’s pick up and see what he had to say about media.
Tim Worner: Current media ownership rules are simply outdated, they’re stopping all of us from competing effectively in what is a new world and that is what we’re all trying to do. It’s no secret that unregulated foreign players are driving huge and rapid changes in our marketplace. The challenge for all of us is to actually match the speed of that change within our own organisations.
Ross: There you go. That is Tim Worner from the chief executive of Seven.