The decision of Nine Entertainment to dump its 28-year long regional network partner Win TV for Southern Cross Austereo looks like an early signal of an impending shakeout in the TV broadcasting business.
The SCA affiliation deal was also able to bypass the “reach rule” that prohibited TV owners from broadcasting into more than 75 percent of the population.
According to Business Insider, Nine CEO Hugh Marks was bullish about the Friday deal and said SCA as “a great outcome.” The reason was obvious as the new partnership will offer 50 percent revenue share unlike Win, which had been offering only less than 35 percent in revenue.
“We are confident that, together, we will offer a premium viewing experience for audiences and a best in class platform for advertisers,” he said.
Nine’s alliance with Win strained a lot after the latter’s legal action over Nine’s streaming service NineNow. Nine was also pushing for a bigger share of Win’s revenue. The change will now push Win closer to Ten Networks.
Under the new deal with SCA, from July 1, SCA will pay Nine 50 percent of the television revenue. In return, SCA will broadcast Nine’s content such as The Voice, The Block, NRL, and cricket, into regional Queensland, Southern NSW, and regional Victoria.
The decision took Win Television unawares and it has reassured the staff that a new programme supply agreement will be worked out, reports The Sydney Morning Herald.
Win chief executive Andrew Lancaster tried to reassure the 750 staff that its billionaire owner Bruce Gordon is fully supportive in this “new era for Win.”
Nine’s deal-scrapping came despite Bruce Gordon being the largest shareholder on the private investment vehicle, Birketu, with 15 percent stake. Gordon is also the biggest shareholder in Ten Networks with a 15 percent stake.
Southern Cross Austereo CEO Grant Blackley said his network will step up production of local news for regional Victoria, Queensland, and southern NSW after rebranding the channels to Nine.