JAMES WARBURTON and ANGUS ROSS talk Seven being number one, streaming plans, heritage formats and 2022

Rob McKnight interviewed the pair as the end of the survey year puts Seven as the #1 network based on total people.

Managing Director and Chief Executive Officer of Seven, James Warburton, and Seven’s Director of Programming, Angus Ross, joined Rob McKnight for an exclusive interview about Seven’s performance in 2021 and rise back to being the #1 network in Australia.

Talking about Seven’s return to the number one position in total people, James said:

“So I think for us, it’s obviously a huge moment for Seven to get back to number one, being in the wilderness in 2019, 2020. So 13 of the last 15 years, we’ve essentially been the most watched network in the country.

“And then obviously from a 7plus point of view as a BVOD service, it’s the second year in a row that we’ve taken that number one mantra.

“We’ve got huge momentum confidence and essentially the shows that Australia wants to watch. When you look at the calendar year and you look at the whole offering, we’ve also been able to make great strides under forties, under fifties. And we talked about being younger, becoming a younger network with our offerings.

“I think the strengths of what we’ve been able to do shows how strong we are in our core and in our spine, but also shows how much potential there is still to be unlocked for Seven in 2022 and beyond.”

Commending James and Seven for making big changes and pulling off results, Rob asked James how sorting Q1 in 2022 will make Seven strong in both total people and the demos. James said:

“We’re much more interested in a calendar year and we’re interested in not taking things in or out. And I think what I should make is with or without the Olympics, anyway you cut it, slice it, dice it or anything else, more people have watched Seven than any other network, again, despite whatever the competitors might claim they won this or they won that. No, the ratings crown is handed out to the network that more viewers watched than any other network. But yes, Q1 was an Achilles hill. There’s no doubt about that.”

“[But in 2022] You’ve got The Voice Generations to launch the year. We’ve got a known quantity in SAS Australia and the buzz that show creates. And then the known performance of Dancing with the Stars up against what the competitors are putting forward. And so much, much better and known start to the year. Last year was our riskiest period. Holy Moly was unknown and we took a punt on Tag, which didn’t pay off. It was an outright failure.”

Angus then added:

“When you’re talking about Q1, we see major improvement at the start of next year with that combination that he referenced, because this year we didn’t have a great Q1. We played a bloody blinder in Q2, in Q3. And that was enough to win us the match.”

Rob quizzed the pair on ratings, and the argument between total people or demos, with James saying revenue was most important to him and Seven. He said:

“When you look at it, we have an expectation certainly July to December that we’ll win the revenue rate, and our job, and as we pointed out to the market, the difference between being number one and not is about 90 million dollars in the historical terms for us.

“So we’ve been very clear with the market in terms of pointing that out and we’ve invested. So whilst we’ve cut costs to address our balance sheet and get our debt well and truly under control, at the same time, it’s been that fine line of cutting costs, making the hard decisions, but investing in content.

“Again, people reinvent the story, but Nine never won the revenue until they became number one in total people. They’d won demos for lots and lots of years. So they’ll tell you it doesn’t hurt. But when you actually look at the facts, they’ve been number one for 24 months in 15 years.

“This is not about, oh, yay, Seven crawled across the line. This is actually about momentum. This is actually about what we’ve got coming, and the fact that this group of people might have lost their confidence, but never lost their ability. And all I’ve done is give them some of the funds to get going and get some formats. We’re still in market for formats.

“We know that any show at any time can age and that’s what we were guilty of under the Seven Studios model of probably over relying on MKR. We’ve been very, very aggressive in terms of things that we’ve gone after. We haven’t got them all right, but we’ve got a hell of a slate. Australian Idol next year is a big one for us. MKR, the pitches from the production industry was absolutely outstanding.”

On the prospect of a streaming service equal to Seven’s rivals of Nine and 10, James said:

“We are talking to global players. There’s a couple of global payers, probably only two to be frank that you’d want to talk to, and we’ve continued pretty positive discussions with them, doesn’t mean something’s going to happen, but we are absolutely investigating a streaming play, remembering we have 10 million verified registered users, which will only grow with the Winter Olympics and the Commonwealth Games some five months later. We’ve got a very effective pace for what is now a very crowded market in Australia.”

Rob then asked Angus about the several heritage brands and formats already established in Australia that have made or are making a return on Seven, such as Dancing with the Stars and Big Brother. Angus said:

“Look, the reason we went with a number of those heritage brands is because they’re known and they work, and we’ve successfully reinvented a number of them.

“We are still looking at new formats and there are a number that we’re
looking at going forward as well. I think it’s just a balance, and particularly you need in some parts of the week, it’s good to have a bit of bulk audience and safety, where perhaps in other parts of the week, you can roll the dice on different sorts of shows, but it’s always going to be a balance for us, but we are definitely in the market for more formats because as I’ve said, you always feel like you’re at least one to two short, and you never know when something’s going to fall over.”

About Big Brother VIP’s failure to fire this year and whether it may hurt the overall brand, Angus said:

“I’m not concerned. I think the cast that we’ve got for next year combined with the All Stars, I think it’s going to be a ripper. I don’t have any concerns whatsoever for the main brand.”

James added:

“And I think in fairness, we launched the format the day that the two biggest markets in Australia got out of lockdown. You can always look at things in hindsight, but when you’re making a decision in July and you’ve just lost a tadpole, and you can’t make something else we were going to make, and you can put a group of people isolated into a house and guarantee you’re going to have a product at the end of it.”

Rob asked James, who rejoined the network in 2019, what his proudest change was from the multiple made since restructuring the business. He said:

“Well, I think for us, it’s just that when you look at it, credibility, respectability, profitability. So when you think about what we’ve done along the way, taking a business that some of our competitors would walk around town. Some of my counterparts would walk around town saying, “Seven are broke, Seven are busted, Seven are done, Seven need to raise capital.” They’d be around. So the first six to 12 months maybe, we knew what the plan was, and so making hard decisions.

“I think our share prices hit four, five year highs. So from that perspective, taking the company back to a billion dollar valuation, those types of things, but at the end of the day, the whole thing sits and turns on content.

“The digital learnings is another one. Six million dollars just a few years ago to more than 120 million dollars this year. So I think there’s a lot of things, but I was a bit trained by David Leckie, so being back at number one is probably something hard to go past.”

Finally, Rob asked James for his opinion on how the other commercial networks are sitting against Seven right now. James said:

“There’s two parts to the question. The first is the industry needs to move forward. The total TV metric and the strength of BVOD. I mean, the BVOD market is the fastest growing media segment of anything. Television is changing and changing fundamental in terms of the way people want to stream their content now. And so the clients and the advertisers are absolutely all over and exploding that growth, understanding addressability, data, and the absolute strength of that is one of the best marketing formats they’ve seen in years and years and years and years. It’s only going to proliferate and get bigger from that perspective.

“Being a national player and selling a national audience gives us a huge upside and level of strength. And I think from the others point of view, they’ve got every right to champion their cause, but I think this one will obviously hurt for our dear friends at Nine. As for Ten, I don’t know what the model is. It’s different now I think with Viacom and I can’t see or understand what the model is.”

“We’re two years into a three year plan and we’re already writing our next three to five year plan, and getting the team together before Christmas to sign off on that. It’s a content business and the business is continually reinventing itself and we’ve shown that this year and we need to continually be doing that. As an industry, we need to be thinking about measurement.

“Measuring television the same way as we have for 22 years is not the most intelligent thing the industry should be doing. And thankfully, we’ve now got a fantastic new chairman at OzTAM in Mark Buckman and there’s been a strategy session. I think everyone sounds to be on board with great new direction.”