Australia’s business commentators have concluded that the ascension of former Woodside Petroleum boss Don Voelte is less a statement about the innate talent that mining chiefs have for media – think Gina Rinehart – and is more a reflection of convenience in the wake of Seven’s bad luck and disorganisation.
Fairfax’s Elizabeth Knight argues that Seven clearly didn’t have a succession plan in place after it lost James Warburton to rival Ten Network.
"Stokes offered Warburton the job of head of television as a pathway to eventually taking over as chief executive of Seven West Media. According to an affidavit that formed part of a case brought last year by Seven against Warburton, the CEO-apparent was not convinced Leckie was going to leave in the Stokes-outlined time frame. Warburton ultimately took the position as chief executive of rival Ten Network. But Stokes has had 18 months to work out an internal replacement or find an outsider to fill Leckie's shoes. Some investors thought that Leckie might stay another year but clearly this was not possible and Stokes had to move earlier than anticipated. He was left wrong-footed and did not have his ducks in a row.”
Business Spectator’s Stephen Bartholomeusz says Voelte must have impressed Seven Group Holdings boss Kerry Stokes during the board meetings at Seven West Media.
"Stokes has, however, hedged his bets. Leckie has been appointed an executive director, media, for Seven Group Holdings, which owns about 30 per cent of Seven West Media and is the vehicle for Stokes’ control of his interests in the media, the Westrac agricultural and mining equipment business and a substantial investment portfolio. Leckie will have an ‘advisory and counsel role’ with Seven West Media’s television operations. Given how difficult and volatile the environment for media, including television, has been and remains – Seven West Media issued a significant profit downgrade earlier this year, although it restated that guidance today – Voelte may need that counsel.”
Meanwhile, The Australian Financial Review’s Matthew Stevens talks to industry insiders about what they think of the appointment.
"It was not difficult to extract comment yesterday on Voelte’s unexpected return to the mainstream of executive life. ‘I can only assume the job search was all about finding a qualified listed company CEO and media/publishing/communications experience was listed as not necessary,’ a media specialist suggested to us. ‘It could work, but only if the executive and line management are on top of their stuff.’ And the mood on the resources side of the gulf was captured by a senior miner who offered: ‘Well, let’s just say as an ageing mining executive, if anyone was stupid enough to offer me a role running a TV and newspaper business, it would take me about one nano-second to decide that there is nothing remotely synergistic about that and my past experience.’ Speaking for himself, Voelte expressed the clear view that "90 per cent” of his new job could be managed through traditional business principles.”
The Australian Financial Review’s Chanticleer columnist, Tony Boyd, says splitting News Corp into two divisions would allow Murdoch to keep the ambitious Pay TV executive Chase Carey, while passing on the publishing assets to one of his three children.
"Not only would he have control of News Corp’s best assets, Carey could step up to be chief executive and bypass the long talked about nepotism option involving one of Rupert’s three children – James, Lachlan or Elisabeth. James has been in purgatory since the telephone hacking scandal blew up in the United Kingdom and is likely to remain there for years because the criminal actions will take years to roll through the UK courts. Although Lachlan has proven skills as a newspaperman, his recent performance in Australia has been abysmal. His Ten Network Holdings investment is an almighty dud and DMG radio has not shot the lights out. Elizabeth has enjoyed the most commercial success of all the Murdoch siblings, notwithstanding the fact that her stellar deal involved selling her production company, Shine, to News Corp.”
Speaking of which, The Australian’s John Durie suggests that any split in News Corp’s entertainment and publishing divisions would be unlikely to include the company’s Australian operations.
On the issue of the day, The Australian’s Bryan Frith suggests that Seven Group mightn’t be as determined to purchase a larger stake in Consolidated Media Holdings or a full bid.
In other company news, Fairfax’s Ian McIlwraith argues that PaperlinX is no longer a takeover target after the board agreed to offload the company’s US business.
In economics affairs, Fairfax’s Malcolm Maiden says there have been many apparent ‘make-or-break’ summits since the global financial crisis that turned out to be largely inconsequential. This upcoming two-day meeting in Brussels for the European Union, however, is pretty darn important.
Elsewhere, Fairfax’s Ross Gittins says Opposition Leader Tony Abbott has been more successful than most political scaremongers in convincing the electorate that the carbon tax will devastate the Australian economy. Still on politics, The Australian’s Barry Fitzgerald says suggestions that the Gillard government could cover a budget shortfall by extending the mining tax beyond iron ore and coal are flawed, largely because the prices of the minerals have fallen. The Distillery remembers the mining tax sceptics warning us that linking the federal budget to minerals was a bad idea.
Finally, Fairfax’s Michael Pascoe asks how the advertising sector is going to reconcile the larger prices it pays for print with the low amounts it pays online, rather than the other way around.