‘ABC not to blame for commercial challenges’ – Alberici

Emma Alberici has written an article in the Fairfax Press regarding the cuts to the ABC, there are a number of themes in the article, with two of her key points being:

• Audiences are obtaining their news, entertainment and information from a myriad of sources that were not available in previous years, the result being that advertisers can target those audiences through (lower cost) mediums other than the mainstream media.
• The review (of the ABC by Peter Lewis) was flawed in at least one area, that being the wages analysis as the commercial television networks outsource much of their content and therefore this lowers the overall figure of employed staff costs.

Emma, in part, said:

"Australia's newspaper and magazine industry doesn't have a problem attracting readers. The challenge is to work out how to make money out of journalism now that they no longer enjoy a monopoly over the distribution of information.

The same is true of the commercial broadcasters. Advertisers wanting to reach mass audiences were once beholden to Channels Seven, Nine and Ten. Today, there's Skype (2003) Facebook (2004) YouTube (2005) Twitter (2006) and Instagram (2010). They're all chasing those same banks, insurance companies, retailers and fashion houses that used to have little choice but to pay newspaper companies and television networks to run their ads.

Now, at minimal cost, they can access global audiences. Meanwhile Australia's newspapers and TV networks are clinging desperately to business models that are broken and blaming the ABC for their woes. Even if the ABC collapsed tomorrow, that wouldn't solve their revenue crises.

After making an unequivocal public promise to quarantine the ABC budget during at least its first term, the Federal Government shut down the corporation's international broadcasting arm and subjected the ABC to an "efficiency review" as a pretext for further cuts of $254 million over four years.

Presumably the report makes no mention of the $50 million that's been saved and reinvested over the past five years. Cast your mind back to 1987 when the ABC consisted of just one TV channel and triple j was only available in Sydney. There were just 38 local radio sites plus two national networks (Classic FM and Radio National). Twenty five years later there are five ABC TV networks including iview, five million pages of ABC Online, ABC Open with the national ABC NewsRadio and Triple J along with digital cousins Double J and triple j unearthed. Local radio is now produced at 60 sites.

More than 30 smartphone and tablet apps with around two million users each month further serve our audiences. Over that quarter of a century we've undoubtedly done more with less as staff numbers dwindled from 6500 to 4000.

The ABC review was carried out by former Channel Seven finance executive Peter Lewis. In his analysis, Lewis acknowledged that it was impossible to make a direct comparison between the ABC and any commercial broadcaster. In no other newsroom will you find a journalist producing radio news, radio current affairs, TV news stories and online commentary on the same day. 

The ABC's staff budget has sent one of the Corporation's loudest critics into a frenzy. At 46% of its costs, it sounds excessive measured against commercial, free-to-air equivalents at 10.7% but that figure is wildly misleading. All the FTAs outsource the bulk of their programming to the independent production sector, which means staff costs are embedded in the overall program price.

Shine Australia, for example, charges Nine circa $25 million for The Voice and a further $20 million to pay the four celebrity judges. That expense is conveniently excluded from Nine's wages bill. Also missing is The Project on Channel Ten, which is made by Roving Enterprises and also costs $25 million pa. It hires as many as 67 people. Consider if you will that The Drumon ABC1 is made by six people for less than $1 million including wages."

You can read Emma's complete article here, and you can read Brad Smarts opinion piece on the ABC cuts here.