Ten Network Holdings’ Paul Anderson

PREMIUM: Paul Anderson, who was recently promoted to CEO of Ten Network Holdings, is concentrating his efforts on building upon Ten’s numerous gains, without forgetting the many contributions Ten has made to the Australian television landscape in its 50-year history.

WS: Ten has been serving Australian viewers for 50 years. What have been some of its most important contributions to the television landscape?
ANDERSON: We have a long history of being innovative and authentic. We delivered the first one-hour commercial evening news bulletin in 1975 and we pioneered mass-market reality television, with shows such as Big Brother, Australian Idol, The Biggest Loser and MasterChef Australia, which has been one the most successful shows in Australian television history.

We’ve been very committed to local drama over the years with popular, award-winning shows like Number 96, The Box, E Street, Offspring, Neighbours and many others, entertaining millions of fans across the country. Neighbours is Australia’s longest-running television show and has been on air for an amazing 30 years.

We launched Australia’s first music TV show, long before MTV was even thought of. We produced the first color TV program, in 1967. We showed the first Friday and Monday night rugby league matches, in 1987 and 1985, respectively. We are really proud of all of these achievements.

WS: In 2014, TEN experienced its first prime-time audience growth in years, and that ratings increase has continued this year. What programming strategies did you implement to bring about this positive performance?
ANDERSON: The growth we’ve seen in 2014 and this year is the result of a clear strategy and a lot of hard work by everyone at TEN.

In 2013-14, we changed the focus of the main channel, TEN, from people aged 18 to 49 to people aged 25 to 54, who represent the biggest group of TV viewers in Australia. To do that, we focused on event TV—including live premium sport—and started developing new domestic formats, such as I’m a Celebrity… Get Me Out of Here!, Family Feud, Shark Tank, Gogglebox, Have You Been Paying Attention?, The Great Australian Spelling Bee and The Bachelorette. We also reinvigorated MasterChef Australia, which grew its audience by 31 percent last year and another 14 percent this year.

We have also focused on consistency, giving our viewers and advertisers a more stable program schedule across TEN, ELEVEN and ONE.

In terms of sports, we’ve renewed our long-standing associations with Formula One and MotoGP, broadcast the Sochi Winter Olympics and the Glasgow Commonwealth Games, and added the fastest-growing summer sport in Australia, the KFC Big Bash League. We also brought V8 Supercars back to TEN after a long absence, completing our suite of motorsport franchises.

Our 5 p.m. news bulletins, which have always been an important part of our business, have been revamped and refreshed, and dominate their timeslot.

Recognizing that television watching is no longer just a linear viewing experience, we’ve focused on digital media, in particular, our online catch-up and streaming platform, tenplay. tenplay was launched in September 2013 to enable us to take our content across multiple screens and reach viewers wherever they are at whatever time they want to watch our content.

WS: How did the deal with Foxtel come about? How do both companies benefit from the deal?
ANDERSON: Foxtel’s proposed acquisition of 15 percent of Ten is one of several strategic arrangements we announced on June 15 this year, including a sales representation agreement with the advertising sales company Multi Channel Network.

The arrangements will enhance Ten’s business and better equip it to respond to the challenges of the ever-changing media and advertising landscape. We welcome Foxtel’s proposed investment and we are confident this proposal will drive value for all of Ten’s shareholders.

By joining forces with MCN, TEN will gain scale, new efficiencies, improved data capability on a world-class trading platform, and provide broader integration opportunities for its advertising clients. The combined sales operation will give advertisers a new way to reach consumers across all video content distribution platforms.

WS: How are TEN, ELEVEN and ONE each serving different audience demographics?
ANDERSON: By moving TEN’s main target audience to 25 to 54, we’ve given ELEVEN and ONE clear differentiated positions in the market.

ELEVEN is the youth channel in our portfolio. It’s the home of fun and bold entertainment programs targeted at 13- to 29-year-olds.

ONE features premium entertainment that’s aimed at men 25 and older. Within ONE, there’s a mixture of premium scripted and reality programming with some local and international sports.

What we have now is a portfolio of channels that are clearly differentiated and that appeal to different audiences.

WS: How important are live sports, despite the expense of sports rights?
ANDERSON: All Australians are obsessed with sports. You pretty much get a guaranteed large audience with mainstream live sports. People want to watch sports events live, they don’t want to record them and play them back. It is event TV at its best.

The portfolio of live sports that we broadcast, including the KFC Big Bash League, Rugby Union, Formula One, MotoGP and V8 Supercars, are critical to the network. History shows that when you give viewers premium sport live, it underpins your entire schedule, provides new advertiser opportunities and creates a positive halo effect across the whole network.

WS: How are you balancing cost containment against investing in programming? In what program genres have you been investing?
ANDERSON: We have a very clear, strategic plan for the business and that includes continuing to focus on finding new efficiencies and new ways of working smarter, while at the same time making strategic, prudent investments in new content.

We’ve shown our ability to manage costs and at the same time invest in successful new shows, such as Family Feud, I’m A Celebrity… Get Me Out Of Here!, Gold Coast Cops, The Bachelor Australia, Shark Tank and others.

We’ve told the market that our television costs would decline 8 percent this financial year, which ended on August 31, 2015. We did that while investing in new shows by being careful, smart and strategic. Our programming department is led by very talented and experienced people who do a lot of planning, development and research to make sure we mitigate any risk associated with launching new shows.

Not everything we launch works, but we’ve had a pretty good strike rate in recently. We work very hard to create buzz and attention through advertising, publicity and promotions when launching our shows, both on and off air.

WS: How important are acquired programs to Network Ten’s channels?
ANDERSON: They are very important and we have terrific relationships with CBS [CBS Studios International] and with Fox [Twentieth Century Fox Television Distribution], and they deliver us a large number of hours of high-quality content. We have to program three channels every day of the year, so we couldn’t survive without those relationships.

Our key overseas shows include NCIS, NCIS: Los Angeles, Law & Order: SVU, The Simpsons, Modern Family, Madam Secretary, CSI: Cyber, Scorpion, American Horror Story, Last Man Standing and Sleepy Hollow, and they all perform well for us.

In addition to that, we get great programming from the U.K., including The Graham Norton Show—whose ratings are up more than 30 percent for us this year—Sir David Attenborough specials and Jamie Oliver’s cooking shows.

We selectively buy overseas movies and what we’ve found over the past 12 months is that when they’re scheduled well, we get a terrific lift in our audiences.

WS: Tell us about tenplay. How popular is it and what are you learning about how viewers are watching programming?
ANDERSON: From a standing start in 2013, we were able to launch tenplay within six months, in September of that year. It’s become one of the most popular online catch-up and streaming platforms in the country. It is industry leading and is regarded as probably the best in the market by consumers.

We’ve had more than 2 million downloads of the tenplay app, which is great when you look at the size of our country. That spans iOS, Android and Windows, but tenplay is also available through providers such as Apple TV, Microsoft Xbox, Fetch TV and FreeviewPlus. We’ve tried to make it as ubiquitous as possible. It supports our linear broadcast and has been an outstanding success.

tenplay is now one of the leading online and mobile entertainment platforms in Australia. It has been key to the success of our “TV Everywhere” strategy, which brings our unique content such as MasterChef Australia, The Bachelor Australia, The Project, Family Feud, I’m A Celebrity… Get Me Out Of Here! and much, much more to people anywhere, any time and on any device.

Each month, we see about 13 million video streams and 25 million page views on tenplay. And our digital team is improving it all the time, adding new features and content in response to how people are using it and to what they tell us they want.

WS: How much viewing is taking place on linear channels and how much is online?
ANDERSON: There’s a lot of discussion about that here locally. Viewing of video on TV still represents 88 percent of all video viewing in Australia; the other 12 percent is on phones, tablets, PCs and laptops.

While there’s increasing competition for video viewing, the vast bulk of all live TV viewing is on free-to-air, in prime time. We live in a more competitive world, but free-to-air television in this market is holding up very well. It still attracts big audiences.

WS: What is the state of the television advertising market in Australia? What is Network Ten’s share of the market?
ANDERSON: By way of context, it’s a $3-billion market largely shared between three free-to-air companies. The market itself remains short, but we’re expecting modest market growth over the next 12 months. Ten’s audience and revenue are trending upward. We’re feeling confident about the future with our recent ratings growth and consistent program schedule.

WS: How are Ten’s channels and tenplay working with advertisers?
ANDERSON: We work closely with our advertisers every day across our broadcast and online assets. We’re delivering the mass audiences via the broadcast channels and the highly specific and targeted audiences delivered via tenplay.

We continue to do more in the area of integration and value-added advertising opportunities. Ten pioneered that area in Australia and we continue to build it out in ways that work for our advertisers and our viewers. Advertisers are ways looking for new and relevant ways to engage their brand with consumers and it’s our job to help them create that engagement, via television, online and social media.

WS: Is audience measurement in Australia satisfactory to broadcasters and advertisers?
ANDERSON: Our television audience measurement system, OzTAM, is widely regarded as one of the best in the world. It is robust, reliable and constantly evolving to reflect changes among consumers, such as the decline of fixed line phones and the rise of mobile-only phones.

The OzTAM ratings system is a great currency, for both networks and advertisers. And it is changing, to bring in viewing on phones, tablets and so on. That can only make it stronger. We know advertisers want a more complete picture of total television viewing and we are giving that to them.