A decline WIN are accelerating with their poor programming decisions.
News is a huge part of the Nine and Seven operations, it supplies huge amounts of their content on a given day, because it is content that is wanted by the audience and not matched by what overseas streamers are providing.
For regional broadcasters where they can’t even fall back on BVOD viewership, maintaining local news was one of the few things they could do to fight back against the trend to streaming.
Nine’s own figures in the sale documents calculated that NBN was profitable as an operation after the 50% revenue share - that profit margin was part of the means of valuing the company, it wasn’t sold because it was bleeding money, it was sold because Nine could book it as an asset writedown to offset the windfall gain they got from the sale of Domain and minimise tax, and to better fit with Nine’s strategic shift to a digital media company.
As a private company, WIN even have more scope to accept lower profits short term to have long term sustainability - not the quick cuts to boost margins that shareholders often demand that kills a lot of companies chasing never ending growth in a declining market.
That WIN didn’t try and make it work is so indicative - start by cutting a small amount of jobs, slim down presenter roles, have the bare bones local windows, etc. See how much you can do to lower costs while keeping the 6pm/7 night a week formula.
They instead just imposed their way of doing things, not caring about viewer habits, not letting those with the experience in the building just meet cost targets. Get the General Manager or equivalent at NBN, set them revenue targets, and then let them manage - I’m sure they’d have made the call to stay at 6pm and try and balance the figures - because the viewer base and the ad revenues at 6pm are much bigger than 5:30.
They didn’t get the chance to prove how capable they were to WIN, and the same staff will suffer when the next rounds of cuts come because WIN’s stubbornness and mismanagement has led them to bleeding viewership and no doubt revenue.
Revenue is falling. It would be expected to be much less than that. There is nothing to suggest the market will stabilise. At least WIN’s early move makes it able to retain the news in this format for more years with stability rather than slowly cutting every 9-12 months because the buffer is now larger.
The ~$360 million figure isn’t my estimate. It comes from the financial projections and estimated program supply fees disclosed in Nine’s ASX documents. Simply saying “I expect it to be much less” isn’t evidence. It was legally disclosed financials to approve the sale.
On your second point, moving the news to 5:30pm has already halved WIN News’ ratings. Ratings drive advertising revenue, so WIN has materially weakened a significant revenue stream. When you halve the ratings and revenue of your #1 show overnight, I’d argue you’ve reduced its long term sustainability.
Economies of scale possibly explain why WIN may be able to produce regional news more cheaply than Nine. They don’t explain why moving the bulletin to 5:30pm, cutting it to 30 minutes, removing weekend news and reducing staff suddenly became the better commercial strategy.
Nine could have made every one of those changes over the last two decades if they believed they would improve profitability. They chose not to. That suggests they believed protecting audience and advertising revenue was more valuable than the cost savings.
That’s possible, but it’s still speculation. None of us has seen the affiliation agreement.
You’re presenting one possible explanation as though it’s fact.
There are plenty of other possibilities. Nine may have prioritised getting the deal done over dictating the schedule. WIN may have negotiated programming flexibility—after all, it already runs 5:30pm news across its other regional stations, so that may have been a difficult point for Nine to push. Or Nine may simply have traded the broadcast time for other commercial terms in the agreement. We just don’t know.
What we do know is that Nine had two decades to move NBN News to 5:30pm, cut it to 30 minutes, remove weekend bulletins and reduce staffing. If those changes were such an obvious way to improve margins, Nine had every opportunity to make them itself. It chose not to. Thats what we know. Everything else is assumption.
In a business of declining revenue, protecting the revenue becomes paramount. They’ve taken an axe to it
Imagine if 9 News Adelaide moved news to 530, cut journalists in half and axed weekend news all to “save costs” everyone on MS would be up in arms about how stupid and short sighted that is. Yet for some reason when win do it folks accept it. This station generates $360m in revenue over 5 years. This is equal to a metro market. That’s no small revenue. It’s an important market and station.
ADL doesn’t need to produce 5 windows of local content (approx 30-40 min per night in total), have 6 regional bureaus etc to generate that level of revenue though. Operating regional news is more complex and expensive.
You’re all looking at it from the news point of view.
I’d like to know the comparative ratings for the 5:30-6pm window? Are they greater now? Are there more eyeballs 5:30-7pm overall? Because that’s what’s important. That’s what will sell advertising and keep local news on air. Not how parochial the bulletin is.
What I think @KICK-IT is getting at, is that Nine could have changed a successful format over 2 decades. Up until end of 2013, Nine News at 6pm was half hour, NBN News could have become a local service any time between the 2007 purchase through to 2013 without dropping it from prime time eg screening at 6:30pm, then could have moved NBN News to 5:30pm in 2014, but Nine didnt try and fix what wasn’t broken.
