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Nine CEO sees ‘world of growth in publishing’ as network slashes costs
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Nine Entertainment CEO Matt Stanton is projecting significant growth potential for the publishing sector, buoyed by new Australian laws compelling tech giants to pay for news content. The optimism follows the recent passage of revamped media bargaining legislation in Parliament, which paves the way for mandatory levies on platforms like Google and Meta if they fail to strike commercial deals with local publishers.
This development comes as Nine undertakes a major cost-reduction program, targeting over $160 million in savings across three years. The network has recently announced redundancies at its prominent Sydney Morning Herald and The Age newsrooms, citing a prolonged downturn in the advertising market. However, its business-focused masthead, the Australian Financial Review, remains a strong revenue performer and was spared from the cuts.
Stanton informed analysts he expects contributions from tech platforms to mirror the substantial sums secured in a previous 2021 agreement. He also highlighted a promising pipeline of artificial intelligence partnerships, noting a recent deal granting Microsoft’s Copilot access to Nine’s content as an example of new revenue streams.
Nine’s latest financial results for the year to June 30 revealed the challenges it faces. While the company posted a full-year net profit of $142 million from continuing businesses, revenue from its publishing arm was broadly flat. The streaming and broadcast unit saw a slight decline, although its streaming service, Stan, delivered a record performance.
The company’s television network continues to be pressured by the weak advertising market overall. To navigate this, Stanton outlined a strategic focus on "growth assets," such as the recently acquired digital outdoor media company QMS. Simultaneously, Nine plans to reduce its exposure to what he termed "structurally challenged and smaller assets."
Looking ahead, the combined outlook of regulatory support through bargaining laws and strategic investments in growth areas like AI and outdoor media suggests Nine is positioning its publishing business for a potential turnaround. The success of this strategy will depend on the outcomes of future negotiations with tech platforms and the execution of its internal restructuring.
