Seven ad campaign attacks regional networks in local news row

Seven has launched an ad campaign against regional networks that want the reach rule covering local news removed.

Seven West Media has launched a blistering advertising campaign on “bullying” regional TV networks for treating viewers as “pawns” in threatening to cut jobs and axe local news services unless the government urgently removes the reach rule.

A TV ad will launch in Queensland this week in a move by Seven to counter multi-­million-dollar “scare tactics” by the regional networks calling for media reform. The ad accuses regional broadcasters of playing politics by using local news services as sacrificial lambs, while plotting corporate deals to enrich their owners. “They really want to make it easier for mergers and takeovers,” a voiceover says. “We don’t support their bullying and threats, and viewers shouldn’t be treated as pawns.”

Seven chief Tim Worner told The Australian it was “great to see some reality being injected into this debate” as the regional ­networks throw considerable ­resources at their lobbying ­efforts, even producing a series of pro-­reform news stories on their TV channels.

“Unlike some of our regional colleagues, we are in this business for the long term and we are walking the talk,” Mr Worner said. “I seriously do not get the TV ads they launched last week, which was exactly the scare campaign we predicted they would run.”

Mr Worner said it made good commercial sense to pour more money into local news, pointing out Seven Queensland overtook WIN Corporation as the top-­rating local news network after increasing its budget for local reporters, producers and stories.

“If they were really serious about the future of local news, they’d be backing it up by investing more not less,” he said.

“Seven Queensland has seen huge ratings and revenue growth in recent years and it’s all down to a commitment to local news.”

Underscoring Seven’s commitment to local news, the Queensland operation’s annual news spend represents 20 per cent of the total expenditure by all regional broadcasters, or 9 per cent of its cost base compared with a peer average of 4 per cent. This is significant because Seven Queensland is responsible for its own income statement and balance sheet, paying the same ­affiliation fees to head office as its regional affiliate partner Prime, meaning it does not have any ­parent company advantage.

“We believe television networks should give something back to the communities they serve,” a voiceover in Seven’s ad says. “It’s only fair and that’s why Seven Queensland spends more on local news than our commercial competitors combined.”

Amid fierce lobbying of regional MPs by the chiefs of WIN, Prime, Southern Cross Austereo, and Imparja, Seven’s TV ad encourages viewers to contact their local representatives.

A TV, radio and online marketing blitz dubbed ‘‘Save The Voices of Regional Australia’’ was launched in regional Australia last week, with grave warnings about the future of local news if the government did not abolish the reach rule.

The law was passed to safeguard local content, and ensure a plurality of views in regional ­Australia. If this barrier were removed, it could unleash a wave of consolidation among regional networks as owners sell out for big pay days, and newly merged corporate entities cut costs to reap merger synergies.

In 2013, WIN expressed concerns in federal parliament about the repeal of the reach rule.

“When companies merge, they look for synergies … removing costs,” WIN chief Andrew Lancaster told MPs, while imploring parliament to leave the reach rule ­intact.

“As you know merged companies look to remove non-profitable items from their business,” he said. Yet, two years later WIN has abandoned its opposition, performing a policy U-turn.

WIN’s backflip has further ­fuelled accusations regional broadcasters are overstating their plight, stirring up anxiety among Liberal and National MPs in regional areas to profit from potential mergers and takeovers.

Outgoing Seven Queensland general manager Neil Mooney blasted the regional networks, saying “they are just not telling the truth”. “What I find personally disappointing is the lack of honesty by some of the regional networks in this debate,” he said.

“It would be refreshing if they put their full cards on the table and came clean about their real agenda here which is trimming costs to get ready for merger or sale. The truth is that regional news done properly is among the highest rating programs, day in, day out.”