http://www.aupaytv.com/index.php News and information dedicated to the Australian media and the digital television industry, including Subscription TV, Satellite TV and Terrestrial TV. en-us Nucleus CMS v3.50 � Weblog http://backend.userland.com/rss http://www.aupaytv.com/index.php/nucleus/nucleus2.gif http://www.aupaytv.com/index.php http://www.aupaytv.com/index.phpindex.php?itemid=1368
Porter agrees there is still "so much compelling industrial logic" to create a truly national pay-TV operator with more than 2.3 million subscribers, but concedes that in the past six months he has begun thinking "it may never happen".

So why the change of heart?Porter says he has grown tired of worrying about a transaction that has been the subject of endless speculation for the best part of a decade.

He also acknowledges that Telstra, which owns 50 per cent of Foxtel, has shown no appetite for the deal despite the best efforts of its other shareholders, News Limited and Consolidated Media Holdings.

"It all comes down to Telstra," he says.

"I'm sure the other half of the partnership would pursue it tomorrow if they weren't hamstrung by Telstra."

The conjecture about Austar's future is part of what Porter describes as the "soap opera" of Australian media. Porter happily admits Austar has "tried to fly under the radar".

Yet his position as one of Australian media's longest-serving chief executives makes him an interesting judge of an industry that has "always been too small a pond for the players".

Speaking to The Australian, Porter, who fronts Austar's interim results today, talks about the challenges for pay-TV, the national broadband network and the anti-siphoning rules governing sports broadcasting.

He also has a blunt retort for those who that suggest US cable billionaire John Malone, whose Liberty Global Media owns 54 per cent of Austar, is pulling the strings.

"There are companies where the dominant shareholder has a lot less than Liberty and that shareholder is a lot more disruptive," he says.

"Kerry Stokes and Rupert Murdoch spring to mind."

The market is tipping Austar will report operating earnings of about $62 million for the first six months of this year, up 4 per cent on the previous first half.

Pay-TV remains a profitable business and Austar has secured shareholder approval for $400m worth of capital management initiatives.

However, these are also complicated times, given increased competition from free-to-air digital channels and a tough consumer environment.

Subscription growth has slowed, meaning pay-TV penetration rates have hovered above the 30 per cent mark for some time.

Austar and Foxtel have been forced to squeeze more revenue from existing customers by offering new products such as updated set-top boxes.

Minneapolis-born Porter, who began working for US cable companies in the early 1980s, acknowledges that "we need a bigger tent for pay-TV" in Australia.

He argues the industry must change the way it does business by offering cheaper and more flexible packages.

"We've essentially been selling the same way for as long as I've been in the industry: big, fat basic package, maybe a couple of general entertainment tiers sitting above it, but then sports and movies," he says. "Customers are saying they don't want to pay for stuff they don't use."

The federal government's proposed national broadband network is viewed as an opportunity.

Porter "seriously questions" whether the NBN will increase regional competition, but he hopes Communications Minister Stephen Conroy turns out to be right.

That would bring Austar closer to a triple-play model (pay-TV, broadband and voice) common in the Europe and the US.

Austar also owns large chunks of regional wireless spectrum and Porter is keen to roll out a regional wireless network where the NBN's fibre is not commercially viable.

"If we are going to replace the wholesale bottleneck of Telstra with the wholesale benign dictatorship of the NBN then that can do nothing but improve our situation," he says.

Of course, Porter has complicated relationship with the national telco. He admits Liberty would put its hand up "in a heartbeat" in the unlikely event Telstra sold its Foxtel stake. But he also acknowledges that ConsMedia and News Ltd (publisher of The Australian) might provide stiff competition.

"Foxtel is to some extent a product of its shareholders . . . if they weren't 50 per cent owned by Telstra, they'd be in the broadband business," he says.

"They are a bit of a camel -- a horse put together by committee. "

In many ways Austar has come full circle. It was pursuit of the triple-play model that contributed to the company's near-death experience in 2002.

Having boasted a share price of almost $10 at the peak of the tech boom, Austar's balance sheet began to buckle under the weight of a complicated strategy and plenty of debt. The company finally sorted out its capital structure problems in December 2002, when private equity group Champ bought in at 15.5c a share.

David Jones, a Champ executive director, soon "formed the view that John and his team were outstanding media and pay-TV specialists that were distracted".

Champ's executives were able to focus on the balance sheet with chief financial officer Philip Knox and leave Porter to worry about signing up and keeping customers.

Jones describes Porter as "a balanced personality". "Obviously we had our moments and he has been through some harrowing moments, but he is very calm and very considered," he says. Champ sold out in early 2006 at $1.10 a share.

In recent years Porter has been criticised for a long-term incentive package approved by shareholders in 2006 that makes him (and other Austar executives) among the highest paid media managers in the country.

Porter's total remuneration topped $14m over the past three years. Corporate governance advisory group RiskMetrics opposed the deal, which was the subject of a shareholder protest vote at Austar's annual meeting in May.

Porter is unapologetic. He says the package was put in place when the company was cashflow break-even and required Austar to grow operating earning by 20 per cent for consecutive years.

He also points out that Austar has posted shareholder returns of more than 700 per cent since January 2003, while its management team has stayed intact.

"If you look through the prism of 2010 you might have different views, but when the plan was put in place it delivered across the board all the things we needed to do as a company, so I don't have any regrets," he says.

Porter considers himself an "Austar person" these days. He remains close to Malone but says he has "never got a call from someone at Liberty saying have you though of this or that."

According to Porter, Malone is in "the business to make money" for himself and shareholders.

"He's not trying to use Austar to get strategic things done in other regions, for example." It is at this point that Porter cites Rupert Murdoch, chairman and chief executive of News Corp, and Kerry Stokes, executive chairman of Seven, as examples of more activist shareholders.

For his part, Porter says he remains happy at Austar. He quips that his senior executives aren't planning a mutiny despite his long tenure, and he gives every indication that he will be around for a while yet. Unless, of course, the merger with Foxtel comes to pass.

"I'm sure things like the (remuneration) and the fact that I've got an American accent make me seem like I'm an outsider. But I'm not.

"This is very much my business . . . Australia feels like home. I'm not going anywhere.

"I used to think there would be some big event that would happen in the industry and I would be out of a job, but now I'm not so sure."

--
* James Chessell
* From: The Australian
* July 29, 2010 12:00AM
http://www.theaustralian.com.au/business/porter-tires-of-dream-of-a-merger-with-foxtel/story-e6frg8zx-1225898180954?]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1368 Thu, 29 Jul 2010 10:20:05 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1367
The regional subscription television group said net profit for the six months ended June 30 fell to $20.7 million from $35.5m a year earlier.

Total financing costs jumped to $33.3 million, compared to $9.3 million a year ago.But at the operating level, an increase in subscribers helped operating profit improve to $63.5m from $58.4m as revenue rose 6.3 per cent to $351.9m from $330.9m.

Austar said it added 3389 subscribers in the second quarter to 747,148, which was up 18,429 over the year.

"While subscriber growth was still subdued in the second quarter, we are seeing positive signs that momentum has returned," chief executive John Porter said today.

He added: "The second half of 2010 will be an exciting time for Austar and its customers, with the 2010 Delhi Commonwealth Games showcased in HD over six dedicated channels, and the launch of a range of key programming that has traditionally connected well with subscribers."

Customer churn decreased from 1.40 per cent in the first half of 2009 to 1.36 per cent.

Total average revenue per user (ARPU) increased 5 per cent compared with the previous corresponding half, ending the second quarter at $84.69.

Mr Porter said the digital switchover, which has already occurred in Mildura, will offer an even greater opportunity for Austar as consumers want a quality, multi-channel experience.

"In Mildura, for example, the number of sales and upgrades increased significantly in the months before analogue switch-off," he said.

The company won't pay an interim dividend.

Additional reporting: AAP

--
* Lyndal McFarland
* From: Dow Jones Newswires
* July 29, 2010 9:39AM
http://www.theaustralian.com.au/business/media/austar-profit-drops-outlook-brightens/story-e6frg996-1225898309905]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1367 Thu, 29 Jul 2010 10:17:53 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1369
Five months after Senator Conroy announced a TV licence fee rebate worth about $250 million over two years, it has been revealed that spending on imported programs has been growing at more than three times the rate of spending on local production.

A report from the Australian Communications and Media Authority for 2008-09 found networks' spending on Australian commercial television production rose 2.4 per cent to $950.6 million while spending on overseas programs was up 7.9 per cent to $430.3 million.The figures suggest that if the licence fee rebate is to boost local production spending, it needs to require stations to spend on local programs.

The ACMA report does support another of Senator Conroy's pronouncements, that the industry's business model was under serious threat.

During 2008-'09 profits from commercial television were $223.2 million, down 29.8 per cent on a year earlier. The fall came at the same time that revenue fell 9 per cent to $3.78 billion, suggesting the stations were unable to cut costs at the same rate as advertisers cut spending in the global financial crisis.

A spokeswoman for Senator Conroy yesterday declined to comment specifically on the implications of the ACMA report, but continued the minister's defence of the rebate decision.

''It is an important interim measure to protect current Australian content levels while the media landscape is changing because of the rise of the internet, and as we make the switch to digital television,'' she said.

Julie Flynn, chief executive of commercial television industry group Free TV Australia, said the figures showed why there was a need for a review of media regulation, a move flagged by Senator Conroy.

''The figures confirm that it was an extremely difficult year for broadcasters, but we maintain our commitment to Australian content,'' she said.

More recent figures show the worst of the industry's revenue woes may have passed. Last week, networks Seven, Nine and Ten revealed advertising revenue for the first half of the year was up 19 per cent.

Source: The Age

--
ARI SHARP
July 29, 2010
http://www.brisbanetimes.com.au/national/tv-licence-fee-cut-fails-to-stop-spending-on-imports-20100728-10w6r.html]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1369 Thu, 29 Jul 2010 08:26:00 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1366
For the first time, ESPN 3D will telecast outside the United States. ESPN 3D, in conjunction with FOXTEL and AUSTAR in Australia, will provide extreme sports fans eight hours of coverage from X Games 16 in Los Angeles, California. Fans in Australia can look forward to seeing the best in action sports compete on Friday, July 30 from 10 a.m. to 1 p.m. AEST and Sunday, August 1 from 9 a.m. to 2 p.m. AEST on channel 206 on FOXTEL and AUSTAR. (Fans in the United States will see this programming on Thursday, July 29 from 8 p.m. to 11 p.m. ET and on Saturday, Aug. 1 from 7 p.m. until Midnight ET.)

During these telecasts ESPN 3D will debut new 3D cameras, including a 3D camera from inside a rally car, providing a driver’s point of view. ESPN 3D’s telecast of X Games 16 in Australia will be available to all FOXTEL iQ2 and AUSTAR MyStar HD subscribers with a 3D ready television.”Extending ESPN 3D to Australia reinforces our commitment to provide fans worldwide the best quality sports programming,” said Michael Morrison, Vice President, ESPN International Asia Pacific. “3D television has taken off in the United States and around the world and this provides ESPN 3D an outstanding opportunity to work with FOXTEL and AUSTAR in Australia to bring this exciting trial programming to Australian sports fans.”

FOXTEL’s Director of Sport Pete Campbell said "FOXTEL was the first to bring Australians 3D television and we're thrilled to partner with ESPN for another ground-breaking sport experience."

AUSTAR's Deanne Weir, Group Director of Corporate Development & Legal Affairs, said, " Following our groundbreaking 3D broadcast earlier this year, we're pleased that regional Australians will benefit once again from the fantastic coverage of the X Games on ESPN 3D."

ESPN 3D X Games 16 facts:

* ESPN 3D will utilize 14 native 3D cameras to capture action at the Los Angeles Coliseum
* Utilize the 3D Mega Mo camera, an ultra slo-mo camera that debuted at the Home Run Derby
* First live use of wireless (RF) 3D cameras, one of which will be an in-car camera used during Rally Car competition
* One pole camera placed near the skate/BMX mega ramp
* ESPN 3D will be hosted by Keir Dillon, a veteran X Games announcer and two-time Winter X Games snowboard superpipe medalist
* ESPN 3D will provide eight hours of coverage over the first and third day of X Games 16

About ESPN 3D:

ESPN was the first to announce in the United States an exclusive 3D network in January 2010 which was the culmination of more than three years of testing 3D television. ESPN has produced several 3D domestic telecasts, including the State Farm Home Run Derby in July 2010, the Masters in April 2010, a Harlem Globetrotters game in February 2010 and in 2009 the USC vs. Ohio State college football game. ESPN has developed best practices for utilizing the technology in live game applications which have provided the ability to streamline workflow operations, adjust 3D camera positioning, perform transmission tests and gauge fan reaction to a 3D telecast versus a traditional telecast. In addition, ESPN utilizes cutting-edge technology located at the ESPN Innovation Lab in Orlando at the ESPN Wide World of Sports complex at Walt Disney World to continue to develop innovative production enhancements. ESPN 3D is available in the United States to approximately 45 million households and has carriage agreements with DirecTV, Comcast and AT&T. Sony was named the first official sponsor of the network in January 2010.

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http://news-sports.net/?id=225&pg=2&keys=ESPN-XGames-broadcast-Australia]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1366 Wed, 28 Jul 2010 21:40:38 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1365
Two Way said it was paid an upfront fee for the development of the application, and receives ongoing license and support fees, as well as for the use of its telecom infrastructure.

The company said its operating cash flow for the fourth quarter had increased 44% sequentially to $212,000. Quarterly cash receipts totalled $486,000, better than the record set in the previous quarter.Two Way ended the quarter with $743,000 worth of cash in hand.

--
15:47, 27th July 2010 By Dylan Bushell-Embling (CFO World)
http://www.cfoworld.com.au/news/533028/two-way-asxttv-launches-chat-app-for-foxtel/]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1365 Tue, 27 Jul 2010 23:36:00 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1364
As the digital switchover gathers pace, it has made deals with the ABC, SBS, Southern Cross Media Group and Imparja Television.

Each of the broadcasters have signed a 10-year deal with Optus to transmit digital television signals into black-spot-bound households where terrestrial digital TV signals cannot reach.Optus director of satellite Paul Sheridan said the telco had begun delivery of digital television satellite signals and said TV viewers in Mildura were already receiving the signals since the government started its analog switch-off program earlier this month.

The government plans to replace all analog television signals with digital-only signals by the end of 2013.

"Optus is proud to be working with the broadcasters to bridge the digital divide and ensure no Australian misses out on receiving next-generation digital free-to-air television services," Mr Sheridan said.

"Delivery of services via satellite continues to make sense for the size and scale of the Australian landscape and Optus's satellite solutions are a proven technology for the delivery of television services.

"We look forward to continuing to work with the broadcasters and the government in ensuring that everyone can continue to enjoy free-view television."

The contract agreements will allow Southern Cross, ABC, SBS and Imparja to deliver Viewer Access Satellite Television -- a service that offers viewers access to the same suite of digital channels available from terrestrial digital TV.

"As the switch-off of the analog services rolls out for anybody who falls into a black spot or where the digital transmitter serves, these satellite services will ensure that the viewers will get the new digital stations," Mr Sheridan said.

The deals were made possible after Optus upgraded capacity on its $600 million satellite fleet last year with the launch of a new D3 satellite.

The new satellite has provided additional capacity across the telco's fleet and is being used to support the growth of digital and pay-TV.

"When Optus launched the D3 satellite last year, it increased the capacity across the fleet by 30 per cent so that effectively gave us capacity to address opportunities like this," Mr Sheridan said.

Although the new satellite has bolstered Optus's ability to transmit digital television signals into rural Australia, it is not expected to feature in the government's plans for the $43 national broadband network as it is unable to deliver high-speed broadband.

--
* Mitchell Bingemann
* From: The Australian
* July 27, 2010 12:00AM
http://www.theaustralian.com.au/australian-it/optus-digital-tv-deals-out-of-this-world-as-digital-switchover-gathers-pace/story-e6frgakx-1225897183859]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1364 Tue, 27 Jul 2010 19:07:32 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1363
On July 23 the Opposition leader unveiled his border protection policy in Perth, the same day ABC News 24 first went to air.

Instead of covering the key election issue, News 24 ran a Lateline segment on cane farming. But when Julia Gillard unveiled Labor's climate change policy, the new channel was there.Rival Sky News covered both events live. As previously reported in The Australian ABC managing director Mark Scott has asked for an explanation of how this could happen on News 24's first day.

Mr Scott today told The Australian that the ABC would improve News 24 based on "audience feedback".

"What we've said is we'd get better over time (with News 24). We are pleased with the launch of the channel and we're delighted with the audience feedback.

"We think we've got an important contribution to make," he said.

Mr Scott refused to provide examples of the feedback. When asked to rank News 24's performance to date, he declined.

"Look we've worked hard and we continue to work hard (on News 24) and that's all I'm going to say," Mr Scott said.

He was speaking at the sidelines of a conference organised by the Committee for Economic Development of Australia in Sydney.

Many commentators and critics have also taken the ABC to task for News 24's performance.

The ABC's MediaWatch program last night had a scathing assessment of the 24-hour news station's first day, also highlighting the disparity in coverage between Mr Abbott and Ms Gillard.

Mr Scott didn't directly address whether the MediaWatch report was fair but said: "Unlike others the ABC is open to criticism … we never said we'd be perfect from day one".

--
* Fran Foo
* From: Australian IT
* July 27, 2010 1:10PM
http://www.theaustralian.com.au/business/media/abc-pledges-improvements-to-24-hour-news/story-e6frg996-1225897472671]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1363 Tue, 27 Jul 2010 19:06:12 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1362
So it was on the Monday after the Sunday night in which MasterChef Australia and the 2010 Election Debate drew massive audiences.

The relatively unexciting Seven News topped Monday night with 1.597 million viewers in the five capital cities ahead of Today Tonight's 1.546 million.Ten's new series Undercover Boss, which debuted after MasterChef on Sunday, held strongly with 1.406 million viewers while Nine's new US sitcom Hot In Cleveland debuted with 1.262 million.

Nine News and A Current Affair split them with 1.32 million and 1.281 million viewers

Nine's Two And A Half Men topped 1.2 million with one of its episodes and Ten's The 7PM Project attracted 1.199 million viewers as it showcased the MasterChef winner Adam Liaw.

Other programs to top one million viewers on a strong viewing night were Home and Away (1.108m), ABC News (1.042m), Good News Week (1.029m) and Nine’s Rescue Special Ops (1.015m).

Best of the ABC line-up was Australian Story with 905,000 viewers while Q & A had 687,000.

Seven's Under The Hammer had 899,000 viewers.

Nine won the night in all people with a 23.9 per cent share ahead of Seven's 23.7 per cent and Ten’s 21.3 per cent.

--
* Michael Bodey
* From: The Australian
* July 27, 2010 10:47AM
http://www.theaustralian.com.au/business/media/ten-drops-to-third-as-masterchef-ends/story-e6frg996-1225897365064]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1362 Tue, 27 Jul 2010 19:04:44 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1361
The reorganisation will centralise the carrier's technical operations relevant to its media business in a new division called architecture, online and media.

To be headed by former network and technology chief Michael Lawrey, the division will oversee the company's media applications, content and online services.The carrier has also made changes to bring its network and information technology operations closer together.

Chief information officer Ashley Lazaro's job description has changed to take in a new division called IT infrastructure and services, responsible for designing its data centres and virtualisation systems.

Its wireless and fixed network operations are to be merged once again under wireless head Mike Wright after being split under former chief executive Sol Trujillo to build the Next G mobile network.

Telstra operations chief Michael Rocca said the reorganisation was made necessary by convergence between its core telecommunications and media businesses.

"I wanted to make sure that I put in place an area of responsibility that led the way as we move forward," Mr Rocca said.

"We need one area of responsibility for architecture, online and media, end-to-end, that has the capability to deliver that to our customers.

"As we move into the multimedia environment it becomes more and more important to differentiate ourselves in that area, and to do that you have to have the right capabilities and operational constructs."

The reorganisation has been announced amid big challenges for the company in both the residential consumer and enterprise markets.

Telstra is under pressure from rival internet providers hoping to snatch its customers and limit churn with new IPTV offerings such as FetchTV and TiVo.

FetchTV's launch partner iiNet has been able to offer the

service without incurring hefty backhaul charges using a terrestrial multicasting system not currently within the DNA of Telstra's core fixed-line network.

Telstra is retooling its network to address the problem and deliver service to its new T-Box IPTV service more cost-effectively.

Adopting a similar concept to FetchTV, the carrier is building new media centres closer to its customers to deliver high-quality media content.

Mr Wright will have responsibility for the new-media centres as well as improving co-ordination between the fixed and wireless parts of the business.

Mr Rocca said the company had decided to discontinue operating Next G as a separate area of responsibility.

"One the main reasons why we moved the wireless unit out on its own was to build the Next G network," he said.

"Now that's built and operating well, it's time to bring (fixed and wireless) capabilities back together again."

--
* Andrew Colley
* From: The Australian
* July 27, 2010 12:00AM
http://www.theaustralian.com.au/australian-it/telstra-reorganises-for-tv-and-online-competition/story-e6frgakx-1225897193054]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1361 Tue, 27 Jul 2010 19:03:22 +1000 http://www.aupaytv.com/index.phpindex.php?itemid=1360
The second series was not expected to exceed last year’s brilliant debut due to a number of fan favourites being ousted before South Australians Adam Liaw and Callum Hann fought out the finalcook-off.

The winner’s announcement, separated from the longer finale, peaked at 4.348 million viewers. The longer ‘episode’ that preceded it averaged 3.542 million viewers.The Ten network said the national audience peaked at 5.74 million viewers with the MasterChef Australia – The Winner Announced component peaking at 4.35 million viewers in metro markets and 1.39 million in regional markets.

An average audience of 1.24 million viewers watched the episode in the regional markets, pushing the national audience to 5.2 million.

The 3.962 million figure falls short of the two highest-rating programs (in metro markets) recorded since the advent of the Peoplemeter ratings system in 2001: the 2005 Australian Open tennis men’s final between Lleyton Hewitt and Marat Safin (4.045 million) and the 2003 final of the Rugby World Cup between Australia and England (4.016 million).

MasterChef didn’t dominate the evening however. The 2010 Federal Election Debate between Prime Minister Julia Gillard and Tony Abbott attracted a total average audience of more than 3 million viewers across the three free-to-air networks.

Seven’s coverage with the volatile Roy Morgan Research dial-driven worm had 1.245 million viewers, Nine’s 60 Minutes’ coverage with a push-button worm almost tied with an average audience of 1.229 million while ABC1’s longer coverage averaged 574,000 viewers across Sydney, Melbourne, Brisbane, Adelaide and Perth.

Ten’s delayed replay added another 364,000 viewers meaning more than 3.4 million viewers watched the debate.

Figures for Sky News and ABC News 24 are not yet available.

--
* Michael Bodey
* From: The Australian
* July 26, 2010 9:57AM
http://www.theaustralian.com.au/business/media/masterchef-tops-39m-but-debate-not-far-behind/story-e6frg996-1225896908998]]> News http://www.aupaytv.com/index.phpindex.php?itemid=1360 Mon, 26 Jul 2010 14:54:03 +1000