Given Alan Bond’s passing, I remembered this post…
In the late 80’s there was a complete change of ownership of all the television networks and some radio networks in Australia. It was an unprecedented occurrence. Suddenly the major broadcast media channels were owned by the nuveau riche (or white shoe brigade) depending upon your view.
Kerry Packer sold his network to Alan Bond for a cool $1 Billion and famously said “you only get one Alan Bond in your lifetime… and I’ve had mine”
I was reminded of this while watching the first episode of Magazine Wars on the ABC on Sunday. It opened a draw in the filing cabinet of my memory. It was about a meeting that was held just after the new media barons took control.
If my grey matter serves me correctly, the meeting was run by the AANA – in a theatre in Sydney. It was off-the-record and closed to the media – no journalists allowed. The only attendees were the heads of advertising agencies and their media buying companies. We agency types were nervous about all the change of ownership and how it would affect advertising rates. After all, the new owners had paid record amounts for their media companies and would want to get their money back. This meant advertising rates could rise.
Each of the new media owners, or their representatives, were there too. Christopher Skase, Warren Jones (representing Alan Bond) Glen Wheatley and other such luminaries gave presentations about their new media babies. The channel 9 presentation was the highlight, as it was done live via satellite from around the globe. Unfortunately the Bond team was called to the stage at a slightly different time than scheduled, so co-ordination with the satellite got stuffed around. But they did cross live to international correspondents. Even Ben Lexcen or maybe it was John Bertrand made an appearance from a boat-building shed in WA. And there was a blimp involved in Europe or the US. All very impressive high-tech stuff at the time.
But the highlight of the show was Kerry Packer. He arrived via the rear of the theatre after all the others had delivered their presentations. You were aware of his presence striding down the aisle, even before you saw him. He stepped up to the stage and asked the host (I think his name was Max) for a cigarette – this was before his heart attack. He then said “so what can I do for you?”
The host explained that the new proprietors had just given their presentations along with assurances that advertising rates would not increase. And given that KP was no longer a media owner, what were his thoughts on the new media situation?
KP lent forward from his seat towards the proprietors sitting in the front row of the theatre and exhaled some cigarette smoke. He said something like “with due respect to my business colleagues here, my family has been running television stations since day one. We know how big the population is and how much growth there is available in the market. I suspect I know how much interest you are paying on the money you’ve borrowed to buy these media businesses and I can tell you there aren’t the multiples in this market to cover the cost of your borrowings through your advertising revenue. I wouldn’t be surprised if I’ll be buying a network back from you in the next 18 months.”
There was some uncomfortable shuffling in seats and the host threw some soft questions at KP before the meeting wound up.
I can still remember talking with one of my Ogilvy colleagues as we departed up the aisle “he knows something doesn’t he?” we naively exclaimed.
And KP certainly did. He famously bought back his beloved channel 9 using the shares Alan Bond had given him in Bond Corporation as part of the orginal sale. The shares of course were worthless. KP sold channel 9 for $1 Billion and then bought it back for a song. Bond ended up in jail and all the new owners of all the other networks soon sold again, just as KP predicted.
It will be curious to see what happens to the current crop of stations that are owned by venture capitalists, when the venture capital dries up?? There’s a bloke who now owns some casinos who might want to take a gamble??
I’m off down town, see if I can find me an Alan Bond…