Tim Worner

This interview originally appeared in the MIPCOM 2014 issue of World Screen.

Anyone jittery about the future of broadcast networks—given the fragmentation of the audience, viewers creating their own on-demand schedules and sluggish advertising markets—need only look to Seven Network in Australia for a very large dose of good news. This year Seven is celebrating its eighth consecutive year as the country’s most-watched network. It also collected more advertising revenue than its competitors, with a share above 40 percent.

A driving force behind Seven’s many successes is Tim Worner, CEO of the broadcaster’s parent company, Seven West Media. He has been at Seven for nearly two decades, during which time he has seen the media landscape change significantly. He is well aware of, but undaunted by, the challenges facing the broadcast business. His can-do attitude, fueled in equal parts by reliance on ratings, gut instinct, and a firm belief in the power of ideas, has infused the company’s culture and driven many of the network’s successes.

Seven is the home of big entertainment shows like The X Factor and My Kitchen Rules, dramas like Winners & Losers and the long-running Home and Away, the best American and British series, news and major sporting events. Seven has two sister digital services: a general-entertainment channel, 7TWO, and the male-skewing 7mate. The catch-up service PLUS7 rounds out Seven’s offerings.

Worner began his career as a journalist and joined Seven in 1995. He held positions as head of program development, head of sports and head of infotainment before being promoted to director of programming and production in 2002. He was appointed CEO of Seven Network Television in 2011 and in July 2013 was named CEO of Seven West Media. Today, Worner oversees not only the group’s TV businesses, but also its newspaper, magazine, online and radio assets, and its investments in other media concerns, such as a 33.3-percent stake in Sky News.

Worner doesn’t take Seven’s market leadership lightly. He knows firsthand how difficult it is to reach that position. He is also well aware of the tough but necessary balancing act required to contain costs while preserving quality programming. In an effort to boost the company’s content-creation capacity, and consequent revenues, Seven has set up production companies in the U.S. and the U.K.

He is also passionate about sports, not only as a fan of football and thoroughbred horse racing, but also because he considers live sports to be a prime driver of broadcast TV, as they reliably draw large numbers of viewers year after year. Worner talks to World Screen about Seven’s success and his plans for its future.

WS: As your responsibilities at Seven have increased, from head of production to head of the network and now to CEO of Seven West Media, is the creation of content still a major concern for you?
WORNER: My role may have changed a bit and now involves other businesses as well as the tele­vision business, but content is absolutely at the core of our company and one of our stated aims has actually been to expand the amount of content we originate and create. In the last 12 months, we have established the production joint ventures 7Wonder and 7Beyond in the U.K. and the U.S., respectively. We have had a lot of success exporting the formats for My Kitchen Rules and House Rules to other territories, and we’d really like to build on that going forward.

WS: Is content a driving force of the company? How so?
WORNER: Content is the driving force of the company; we are now delivering it across multiple platforms, and we only see this growing in the future. Our company’s most precious assets are people and ideas. When you get the right people and the right ideas together, you can really take great strides in a big hurry.

WS: Seven has had to make cuts in its budget. How have you contained costs and at the same time continued to produce high-quality programming?
WORNER: All media businesses have had to deal with structural change, and for us sometimes that has meant having to walk away from content that under normal circumstances we would have preferred to retain. That is never an easy walk to take, but if we believe something just does not represent value any longer, we will do it. In addition, the search for operating efficiencies never ends. We are always challenging ourselves to produce our content more effectively. We have to keep finding smarter ways to produce. That in itself can be a very creative process. Again, that is a process that is powered by ideas.

WS: What have been some of the entertainment, news and sports programming strengths of Seven that have allowed it to maintain its ratings leadership?
WORNER: There are three key planks to our strategy: live sports, live and local news and public affairs, and Australian programs. This is not to say that foreign content does not have a place on Australian schedules—far from it. But we tend to concentrate on those three areas.

WS: Tell us about Seven’s relationship with the Hollywood studios. Even with Seven’s many successful homegrown shows, what role do imported shows have on Seven, 7TWO and 7mate?
WORNER: I think we’ve kept a strong relationship with all the studios, and we certainly have a really healthy respect for all of them. There is still a very real role for foreign content in Australia, but there is no question our audience is getting access to a lot of this content illegally prior to us being able to monetize it. That is going to be a conundrum these studios and distribution houses are going to have to deal with. It is simply unreasonable to expect that we will continue to allow this to happen without there being a very real impact on pricing. We are already seeing that, and if nothing is done to prevent the illegal access to content, I think we will very quickly see it become a lot more pronounced.

WS: How are formats faring on Seven and in Australia in general?
WORNER: The big, multiple-night reality franchises are still very strong. Along with live sports, they are the most powerful programming options by some distance. We have had a great deal of success with My Kitchen Rules, which in its own way approximates live sports. In its fifth season it still held on to the title of the number one show in the country. When you consider that you are running it for three and four nights a week for 13 weeks, it has the potential to be a game-changer. House Rules built its year-on-year audience 20 percent in its second season as well. These have become exceptionally popular with our sales teams because it is so easy to integrate an advertiser’s message into the content.

WS: What is the state of the Australian advertising market in 2014? What is Seven’s share of the advertising pie?
WORNER: We are forecasting low single-digit growth in the ad market for the coming year, and this follows a couple of consecutive years of subdued conditions. It’s tough, but we are holding onto our share, which has been consistently above 40 percent.

WS: Are you working to diversify the company’s revenues away from advertising?
WORNER: We have had to put a lot of work into becoming less reliant on advertising and cover-price [newsstand] revenue in our publishing businesses. We look at ourselves now as an audience business with content at its core. We are originating and creating more content all the time, and we have had considerable success selling that content into other territories and selling that content on demand. Beyond that, we are looking at what can be done with the very strong brands we have created in terms of social media, live events, merchandising and other areas. The one thing we cannot do is stand still, because if we do we will get run over.

WS: Seven has won the rights to the Olympic Games through 2020. Why was this an important deal to make?
WORNER: I think there is going to be something of a revolution in the way these big multi-sport events are going to be delivered to viewers, and the Olympic Games is going to be the very best example of it. These events, where there is so much action occurring simultaneously, really lend themselves to being delivered over multiple platforms. In addition, these big, live tentpoles are second to none as programming launch platforms. We are still monetizing programs we launched out of the Sydney Olympics coverage in 2000. I think we also need to consider that in an environment where the audience is fragmenting, events like the Olympic Games can only become more valuable as pro­gramming propositions.

WS: Tell us about Hybrid broadcast broadband TV (HbbTV). Why is this an important development for Seven, and how will it allow you to better serve and connect with your viewers?
WORNER: HbbTV allows for a seamless transition from spectrum-delivered content (normal free-to-air TV) to broadband-delivered content. The amount of spectrum-delivered content is constrained by how much spectrum we can use. The amount of broadband-delivered content is practically not constrained at all. That means we can deliver extra content that may not necessarily appeal to a mass market, and we have never been able to do that before. Previously, when we bought the rights to a premium sporting event, sometimes we had to leave some of that precious content on the cutting-room floor because we were constrained in the amount of content we could deliver. Those days are over. Through the use of HbbTV we can now deliver all of the content from a sporting event that may be considered slightly less mainstream in accordance with viewers’ specific interests. This allows us to monetize those assets and satisfy the more personalized tastes of our viewing audience, all from the comfort of their living rooms, delivered to the biggest screen in the house.

WS: Are there areas where the television, magazine and print businesses at Seven West Media can work together?
WORNER: We have had enormous success integrating our magazine titles into television offerings. Better Homes and Gardens has the highest readership of any consumer magazine in Australia. It’s no coincidence that the brand also fills a 90-minute prime-time slot every week on our television network and the show is still rating after being on air for more than 20 years. Our title Home Beautiful was heavily integrated into our reality franchise House Rules and the circulation uplift was outstanding, as was the integration of our advertising partner’s messages across the magazine, the TV series, Yahoo!7 (the online joint venture with Yahoo!) and the app. When we develop new series now, we are always looking at how we can leverage them across all of our assets.

WS: As CEO of Seven West Media, what have you learned from the television business that you can apply to newspapers and magazines?
WORNER: It doesn’t matter whether it’s television, newspapers or magazines, it still comes down to a contest of ideas. Whoever identifies them, originates and develops them and executes and markets them the best will win. I guess it is another way of saying that content is king. That has been so clear to us in television for so long, and it is absolutely no different in magazines, in newspapers or indeed online. Some things never change.