Has the penny finally dropped for Gina Rinehart?
As Gina Rinehart dithers over her allocation in Ten's capital raising, surely she must be realising it's not necessary to spend millions to gain a broad media reach.
After a tumultuous year Rinehart is now a household name… she was virtually unknown outside of Western Australia when she made her original ill-fated investments in both Ten Network and Fairfax Media.
Today the media hang on every word she says. Yet her fundamental aversion to traditional media is self-evident: She has a stake in a television channel yet she shuns television reporters, she is a shareholder in a newspaper group yet she is contesting a key underpinning of newspaper products – the right to protect sources – in the WA courts.
Ironically there is no need to either waste her money or endure such stress: Rinehart could bypass traditional media and still get her message to the masses simply by going directly to the people. New media technologies allow public figures to reach an audience without intermediaries: Witness Kevin Rudd and his 1.1 million Twitter followers (that's four times the number accumulated by Prime Minister Julia Gillard).
Rinehart has a considerable constituency of support which is both influential and vocal: Yesterday she received a round of applause when she arrived (late) at the AGM of the Ten Network where shareholders, at least, see her as a positive influence.
As the financial demands of the $10 billion Roy Hill iron ore project – her most ambitious mining development to date – move centre stage, her accumulated losses in media companies must surely sting. She's dropped $142 million at Ten Network alone, and that's before yesterday's desperate and deeply discounted capital raising. At Fairfax she is clearly moving to reduce her losses, dropping her stake from 19.9 per cent a few months ago to less than 15 per cent today.
And even if those amounts seem slight in the context of a $29 billion fortune (the last BRW rich list calculation), it must be embarrassing for someone who has been so successful in one area of business to endure such dismal failures in another.
Now she has the added dilemma of whether she pours another $20 million into the latest capital raising at the Ten Network. If she doesn't her holding will be diluted and she will stand in sharp contrast to her board colleagues Lachlan Murdoch and Jack Cowin, who have already committed to fully taking up their allocations.
Whether she finally stumps up the money or not her very public delay in supporting Ten Network – not to mention her poor attendance record at Ten board meetings, where she has missed six out of 14 – suggests she is at the very least indecisive on the merits of investing in media.
Rinehart seems to think she can emulate her father Lang Hancock and his use of media ownership to push her oft-stated prinicples of thrift, hard work and private development of north Western Australia. But times have changed. It is not necessary to own media to exploit media: Social media combined with the astute use of traditional media can work a treat. Just look at Dick Smith’s idiosyncratic outbursts, which never fail to draw headlines… yet Smith has never felt the need to actually spend any money.
But first Rinehart will have to devise a better media strategy. Her publicity strategy around her new book 'Northern Australia and then some' suggests she remains for the moment oblivious to the realities of successfully transmitting any message to a wider public. The book is not available online or through bookshops; it remains exclusively sold through organisations that are friendly to her political views, such as the IPA.
With that sort of approach she won't reach anyone beyond the usual suspects... but at least it's not costing her much.