Ad pledge from CBS allows Ten to take on ‘Silicon Valley interlopers’

CBS Corporation has formally recommitted to Ten Network’s advertising sales contract with Multi Channel Network.

Paul Anderson, Ten Network CEO, and Anthony Fitzgerald, MCN CEO

CBS Corporation has formally recommitted to Ten Network’s advertising sales contract with Multi Channel Network, Media can reveal, ending months of uncertainty about the future of the long-term deal.

A large question mark was hanging over the seven-year contract as Ten’s new owner explored possible alternative options.

With Ten in voluntary administration, CBS had the ability to repudiate the contract, which was signed in 2015. Adding to persistent doubts was a decision by program supplier 21st Century Fox to end a key content deal with Ten.

CBS and News Corp executives, meanwhile, avoided making comments on the future of the ­arrangement, which only added to the sense that the deal was in the balance.

In an interview with Media, Ten chief executive Paul Anderson declared it was “business as usual with added benefits” as he talked up the potential upside of being owned and operated by the top-rated US network in total viewers for the past 14 seasons.

“When we went into this relationship we talked about scale, efficiency and technology. All those things are more important now than ever before,” said Mr Anderson, noting that the free-to-air market is now under even more pressure from the Google and Facebook ad duopoly.

Ten’s takeover by CBS was ­finally completed on Thursday, administrators KordaMentha confirmed in a market announcement. The long-awaited sale — delayed by a NSW Supreme Court challenge — was finalised at 3pm. Leslie Moonves, chief executive of CBS, said the change in ownership “marks the beginning of an exciting opportunity to build and expand on our close working relationship” with Ten.

Foreshadowing the launch of online streaming service All Access in Australia to rival Netflix, Mr Moonves said the acquisition would pave “the way for further multi-platform distribution opportunities for CBS content”.

Asked if the completion of the deal would trigger any changes to the management team and the way Ten is run, Mr Anderson said: “We haven’t decided on any of that yet. It’s clearly early days. We are going to make changes across the business for the better but they will be considered.

“With the backing of CBS, there are not going to be any major changes to Ten’s DNA. CBS is very respectful of that, but at the same time we are here to provide a ­return to CBS and to grow the business. They’ve made it very clear they are not a big American company that will come down here and say we are going to do things our way.

“They understand that the local market is uniquely Australian and that their job is to help us with their experience.”

Ten’s ads are sold by Multi Channel Network, which is half-owned by Foxtel, whose joint shareholders are Telstra and News Corp, publisher of The Australian.

Fox Sports Australia and Ten each own 24.99 per cent of MCN, which is chaired by Foxtel chief executive Peter Tonagh. Fox Sports is 100 per cent owned by News Corp, which shares common ownership with 21st Century Fox.

Armando Nunez, president and CEO of CBS Studios International, held recent meetings with Mr Tonagh in Sydney at which the MCN relationship was discussed in some detail. After considering his options, Mr Nunez decided he was happy with the performance of MCN, which was brought on board to give Ten more heft in a TV ad market under recent attack from Google and Facebook.

They are pursuing new strategies in the ongoing annual ad-selling season as part of a concerted effort to develop deeper relationships with top media buyers and shatter the traditional media stranglehold on annual-volume agency deals.

Anthony Fitzgerald, chief executive of Multi Channel Network, said the “ongoing commitment to this partnership” marked the “start of a new chapter” between Ten and the sales house.

“The real competition from an advertising perspective is the Silicon Valley interlopers,” Mr Fitzgerald said. “This partnership puts us in a stronger position to combat them. It will allow us to do more than ever before.”

Under Mr Fitzgerald, MCN has developed a reputation for driving bold initiatives that have upended traditional TV trading practices in the local market, including the MCN-AOL programmatic trading platform, multi-screen audience data strategies and machine automation.