You are looking at a very simplistic way. The networks got the same for ~30% 15 years ago.
Anything up to 40 is understandable although the metro networks are also forcing in contracts to follow their schedules so it is hypocritical to then expect more because of something THEY insist on.
Bottom line, if Seven gets 40% as the number one supplier, Nine should be getting less. It is only the news add-on that justifies more than 40.
What are you basing these numbers on?
40% being acceptable/ not acceptable?
You’re just pulling even numbers out of the air
Unless we know what % or revenue Nine spends on the same things (programming, marketing, promos, Publicty etc) then how can we know if 50% makes sense or not?
Because the network expects more money every time the contracts comes for renewal for no real benefit to the affiliate. I’ve been watching this for almost two decades. I know what has come up and how it has developed.
They run the same brand, there are no additional costs except for news.
Perhaps the programming and marketing costs have gone up greatly over the last 2 decades?
There are now 4 channels of programming, there used to be one.
Australian programming used to max out at $500k an hour for scripted content like McLeods Daughter and water rats. Now reality shows cost $20 million for format rights plus up to $1.5m per hour
Sports programming costs have ballooned also
Nine pays for all this. All costs that have likely increased. As their ad revenue has declined.
That would suggest the % of revenue that Nine spends on programming has also increased
Just as the affiliates has…
Nine is spending hundreds of millions of dollars on programming a year, unless we know what % of revenue they devote to that - it’s hard to know if it’s in line with what say SCA is spending (50%)
Do you mind if I ask if you work for an affiliate TV group?
That is Nine’s responsibility to manage their costs. Nine produces for its own five markets (7 including NBN and Darwin), then lets SCA piggyback off their feeds. What Nine does would be done even if the affiliate wasn’t there. Just they would be pulling less profit.
That’s not true. Affiliate fees bring in hundreds of millions. The networks would not have nearly the programming budgets they have without that source of revenue.
Tens of millions per year, not hundreds. The network schedules are devoid of much new decent content these days, could you imagine if they were any worse!
Their decision to spend tens of millions on one format is their decision, not the affiliates, and I cannot see any argument that they would cut the “reality” shows if they did not have an affiliate. Their ratings would drop, particularly with the younger groups that have no patience.
If Nine spends 50% of its revenue on programming, marketing and Publicty costs then its outlaying the same percentage as SCA
The truth is we don’t know we can only speculate
But if nine agreed to it and SCA agreed to it it’s fair to assume it’s fair value.
If it drops or increases come July and both parties agree also it’s fair to assume that will be fair value.
Both parties bring something very valuable to the table that the other needs. Just how much value each is worth, we can only speculate - but they would know and come to an agreement that is satisfactory enough that they sign it for 5 years
Surely WIN, SCA and Prime must be considering what their exit strategy is for their regional TV networks.
Only Nine have acknowledged that VOD is the future and have invested in the technology. The others haven’t kept up with changes in technology and have only themselves to blame.
Yeah, their exit strategy is getting the reach rule changed and selling out to the metros.
They’ve already got the reach rules changed?
As for the second one, I think the metro networks aren’t likely to buy their regional affiliates unless they can get them on the cheap. Even then, I think the only really sought-after regional TV markets are the decently populated ones of Queensland, Northern NSW, Southern NSW/ACT & Victoria. Tasmania is borderline, while there’s probably very little interest in SA, WA or Remote Central & Eastern Australia.
Yes they did, back in 2017.
Could we see Radio Networks or players like ACM buying TV? Like Grant Broadcasting could buy GTS/BKN and Resonate Broadcasting buying into the Remote Central and Eastern Australia licence?
I truly think their strategy is to maintain the current situation until revenue is so low and the value of the stations is so low they’re priced at a price where the networks can snap
Them up easily
But unless they are bargain basement price, why would a company like Nine who is moving towards digital and streaming be interested in purchasing assets of a declining business model
10 does have Paramount+ which is helpful, if VCBS keep their content on it in this market, 10play has a decent footprint but its interface is ugly and is buggy but it’s been there for a while and has good levels of usage.
The only one I could really see being bought would be 7 Tasmania by 7. That would be the only one making a decent amount of money and with good enough production values with the news etc… that a transition could happen relatively seamlessly.
Prime NNSW is a larger market than Perth and Adelaide and over 4 times larger than Tasmania. I’d imagine it brings in a lot of revenue