06 Apr THE BIG CONUNDRUM: BIG AUDIENCES, SHRINKING REVENUES
AUSTRALIA’S COMMERCIAL MEDIA
THE BIG CONUNDRUM: BIG AUDIENCES, SHRINKING REVENUES
For the Australian commercial media sector, the COVID 19 emergency has become a matter of financial survival, even as audiences continue to grow.
With the pandemic cutting a swathe through global markets, leaving thousands of fatalities behind and millions of workers headed for the dole queues, Australians are flocking in record numbers to mainstream and social media to keep up to date.
For instance, the number of Australians who say they are spending more time watching television has risen by a whopping 55 per cent in the past couple of weeks, according to CT Research. Readership numbers have increased significantly, especially online, while radio audiences are understood to have gone up, too.
But just as audience numbers rise, advertising revenue is shrinking at an alarming rate, as an increasing number of advertisers are forced to curtail spending due to the restrictions put in place to combat the spread of COVID 19.
This is particularly evident in the now-grounded travel sector, which has been a major revenue source for media companies, but the cuts have been felt elsewhere, including hospitality, retailers and of course, major sporting and cultural events.
As a result, print newspapers have shut; magazines have been closed, at least temporarily; pay cuts have been introduced across the board; and more job losses are now expected.
This is what has been happening for the past week or so on the commercial media front:
Australia’s largest commercial media company has announced it will suspend the printing of 60 community newspaper titles in NSW, Victoria, Queensland and South Australia, effective April 9. The papers – which range from The Manly Daily to The Coffs Harbour Advocate – will continue to publish digitally.
Chairman Michael Miller said News Corp’s main priority was to “preserve jobs” and get the company in a strong position to counter the crisis, while announcing pay cuts for senior executives.
Nine Entertainment (Publishing)
Previously known as Fairfax, the publishing arm of Nine has announced the suspension of some of its print magazines, including BOSS, which will now appear as a weekly section inside The Australian Financial Review.
Other monthly titles going into hibernations are Good Food (which was a separate magazine in The Sydney Morning Herald and The Age), Executive Life, and the luxury publications, AFR Magazine and AFR Sophisticated Traveller.
Seven Media has been hit particularly hard, with both the 2020 Tokyo Olympics and the AFL season postponed, meaning a sudden and totally unexpected collapse in advertising revenue.
This prompted CEO James Warburton to announce 20 per cent pay cuts for staff on $200,000 a year or more, plus the introduction of four-day weeks in some areas.
Warburton also warned that despite cost-cutting measures, he expected job losses across the network to be “inevitable”.
Southern Cross Austereo (SCA)
The owners of 86 radio stations nationally, including Triple M, and a string of regional television outlets, SCA has cut wages by 10 per cent across the board.
It also confirmed that it has secured what has been described as a $170 million equity lifeline “to help keep the lights on”. The money raised will be used to pay down debt.
According to SCA, it expects revenues to be materially impacted by COVID 19 – and down 30 per cent or more.
Network Ten is introducing reduced work hours to cope with the advertising drought. It has also announced that staff will be encouraged to become part-time under a range of measures aimed at helping the business through the COVID-19 pandemic.
Elliott Provincial Newspaper Group
The publisher behind the Sunraysia Daily and other Victorian regional outlets has announced it is temporarily suspending printing of newspapers.
There is, however, a glimmer of good news and it involves The Sunraysia Daily.
Given the importance of the 100-year-old paper to the local community, the Saturday printed edition has reappeared and will continue for the time being, with the publishers seeking assistance from Canberra through the JobKeeper scheme.