In classic Fairfax fashion, the cracks in Nine Entertainment’s board run deep

Nine Entertainment chair Peter Costello and new CEO Mike Sneesby. Picture: Britta Campion

Twenty-five years ago, I found myself in a lift accompanying one of the directors of the then John Fairfax Holdings to very private board dinner.

“Listen very carefully to everything that you hear tonight”, I remember him saying to me. “These people will never be in the same room again.”

In that room in early 1996, a who’s who of power and influence at the time sat around the table: Conrad Black, the larger than life Canadian media baron who had won the long-running battle for Fairfax; Black’s powerful second in charge, Dan Colson; the irascible South African Stephen Mulholland, chief executive of Fairfax until just a couple of months earlier; banker Mark Burrows who had run the auction for Fairfax and known as a close adviser to Rupert Murdoch; David Gonski a longtime friend and adviser to Kerry Packer; John Alexander, an editor-in-chief of two Fairfax mastheads and firmly in the Packer camp; and the recently appointed chief executive of Fairfax, Bob Mansfield.

Black controlled 25 per cent of Fairfax, Packer 17.5 per cent and Murdoch 5 per cent.

I can also remember rather cheekily asking Bob Mansfield how on earth he was going to juggle all these very interested parties. I got a confident response: that he, Mansfield had been chief executive at Optus, and McDonalds Australia, he had worked to many boards and had never taken sides. He had always been answerable to himself.

Mansfield lasted a total of five months.

I shared a taxi with Dan Colson after that dinner. “Are you always this nice to people you meet?” I asked as I thanked him for the lift. He looked straight back at me and paused. “No” he said.

Now that was a fractured board.

Wednesday’s announcement of Stan chief Mike Sneesby as the new CEO of Nine draws to a close yet another tense chapter in the history of Fairfax, now Nine.

Members of Fairfax’s board in 1996: deputy chairman Dan Colson, CEO Bob Mansfield, chairman Sir Laurence Street and Stephen Mulholland at Mansfield's appointment as CEO.

The split in this public company board is not about media barons. It fell neatly into the two camps forced together in Nine Entertainment’s 51 per cent takeover of Fairfax: broadcast and digital on one side, print and digital on the other. The Nine camp backed Sneesby, the Fairfax camp backed chief digital and publishing officer Chris Janz, who recently drove the Google and Facebook deals for Nine.

Nine chairman Peter Costello and Nine chief executive Hugh Marks were chairman and chief executive of the legacy Nine Entertainment business. Nine deputy chairman Nick Falloon has had ambitions take over the chair of Nine.

Falloon was previously chair of the Fairfax board but also has had a long relationship with broadcasting including as CEO of Packer’s Publishing and Broadcasting when it owned the Nine Network.

When I interviewed Hugh Marks on his results in late August, Stan’s rise and rise was the big story. “We’ve got a great model” he said, “as the aggregator in the market I think it’s got a really strong position.”

In the grand conspiracy of things, one might ask who or what led to this week’s investigation of deputy chairman Nick Falloon (in the Fairfax camp) into allegations he misused a golf club membership?

And who pushed hard for the dismantling of the Hugh Marks, who many at Nine admired for his achievements, after his in house relationship was made public?

Two days before Sneesby’s appointment was announced, Nine director Patrick Allaway announced he would be immediately resigning from the board. Allaway had already announced his departure for April, due to his growing commitment as chairman of Bank of Queensland, but the timing speaks for itself. Remaining on the board, at least for now is former Fairfax board member Mickie Rosen, who has just joined the board of Bank of Queensland.

John Fairfax Holdings non executive director Conrad Black (R) and deputy chairman Dan Colson at a Senate Inquiry into foreign media ownership.

On Wednesday, chairman Peter Costello and his new CEO Mike Sneesby spoke to staff up and down the newsrooms at Nine’s flash new North Sydney offices. Costello insisted there was no fracture of the board and that Mickie Rosen (although he didn’t name her) had no intention of leaving the board.

The ambition of Nick Falloon to take over from Peter Costello looks rather cruelled by events. The future of the talented Chris Janz is a fascinating question and will fill plenty of copy.

It is worth noting that this was no two horse race for the CEO job. There were other genuine strong contenders. But that is not how the media at large will see this. At board level, this is a Nine camp victory.

The Machiavellian plays afoot around the time of the 1996 Fairfax board dinner are war stories today. In 1996 Conrad Black sold out of Fairfax to Ron Brierley, frustrated by Australia’s politics and regulation that robbed him of full control. He later had a spell behind bars. Ironically, Brierley too is now facing criminal charges of a different kind.