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Fairfax and Macquarie Radio merger officially announced

December 22nd, 2014 at 09:44am

After a number of failed attempts in recent years, and a heap of speculation over the weekend, the official announcement was made to the stock exchange a short time ago: Fairfax Radio and Macquarie Radio are merging.

The business mechanics of it are a tad complicated, but effectively what is happening is that Macquarie Radio is buying out Fairfax Radio, and paying them with Macquarie shares so that, at the end of the transaction, existing Macquarie shareholders will own 45.5% and existing Fairfax shareholders will own 54.5%. Five directors will be appointed to the board, two each from the existing Macquarie and Fairfax, and one independent.

To deal with the regulatory problem of being able to own only two stations per market, Sydney music station 2CH will be sold. While this sounds simple enough it will pose a few problems with staff at 2CH currently overlapping with staff at 2GB, especially 2CH breakfast presenter Glenn Wheeler who hosts Saturday nights on 2GB and occasionally fills-in on other 2GB shows, and 2CH presenter Kel Richards who is a regular night time fill-in on 2GB. 2GB’s Macquarie Radio News also provides news for 2CH, often in the form of a two-and-a-half minute pre-recorded bulletin. With a merger of the 2GB and 2UE newsrooms, it wouldn’t surprise me if the Macquarie pre-record is dumped in favour of Fairfax’s own three minute pre-recorded national news. Behind the scenes operations could also be adjusted in some way.

Meanwhile 2UE and 2GB face an interesting future for presenters as it seems unlikely from a business standpoint that they will run competing talk formats, and will either further soften 2UE’s format or change it completely. Update 15:21: A leaked email from Fairfax management to Fairfax Radio staff has been posted by Mumbrella, and it notes that 2UE will remain as a News/Talk station. They seem confident that they can grow the audiences of breakfast hosts John Stanley and Garry Linnell, morning host Stuart Bocking, and weekend morning power duo George Moore and Paul B. Kidd, which tells me they do plan on further softening the talk format on 2UE to appeal to a different demographic to 2GB. End Update. If talk is to be removed from 2UE (and that is a big “if”) then it is likely to take up a music format similar to Fairfax’s Magic format in Melbourne and Sydney, which targets similar demographics to 2CH (removed as part of update as this statement is now redundant).

I expect a lot of 2UE personalities will be brought across to 2GB in various degrees, probably as fill-in hosts at first. One which I do wonder about is John Gibbs, host of Sports Today on 2UE, who used to commentate on rugby league matches with Ray Hadley’s Continuous Call Team when it was on 2UE…as I understand it, Ray and John don’t get on as well as they once did, but with a vacancy on the Continuous Call Team caused by the (entirely unnecessary overreaction in my view) sacking of Steve “Blocker” Roach earlier in the year and a need to find efficiencies in the merged entity, it might be inevitable that Ray and John could end up working together again. It is also possible that, when AFL isn’t in the way, 3AW might take Melbourne Storm matches from 2GB, and when NRL isn’t in the way, 2GB might take Sydney Swans matches from 3AW, or perhaps 2UE will just start taking most or all AFL matches from 3AW rather than just Swans finals (although 2UE managed to get out of that contract this year somehow…so who knows).

Elsewhere, Fairfax’s 96FM in Perth is being sold to ARN (reportedly for $78 million). In the merged entity it is the “odd one out” as the only FM music station, so selling it makes sense even though it is not required legally as it does not take the merged entity’s number of stations in Perth over two.

Macquarie’s Queensland regional network (MRRN) will be sold, indicating that the merged entity if interested only in running stations in metropolitan markets. This seems like a shame, but probably makes sense given that Fairfax’s history of running regional stations is abysmal.

What this means for the possibility of the expansion of Ray Hadley and Alan Jones’ shows in to other markets is unclear. My tip is that Ray Hadley’s show will probably air live in to Brisbane on 4BC, especially given a large exodus of talent from 4BC over the last few years amid struggling ratings, and Alan Jones’ one hour highlights program will probably air on the entire network. It wouldn’t surprise me if Ray Hadley’s show is packaged as a highlights show for 3AW Melbourne and 6PR Perth. Whether the new entity will treat sacked 6PR presenter Howard Sattler or sacked 4BC/2UE/2GB presenter Michael Smith any better is a mystery, but one can hope.

I also wouldn’t be surprised if Steve Price is moved back to Melbourne and given a show on 3AW. Currently Steve Price has a show on weeknights on 2GB which he sometimes presents from Melbourne and sometimes from Sydney, with the Melbourne broadcast coming from the studios of RSN 927. His co-host for the first hour, Andrew Bolt, also uses those studios, with the lack of visual cues between the two combined with a slightly delay over the interstudio link causing occasionally clunky interactions. I’d expect them to both broadcast from 3AW’s studios from now on, and it wouldn’t surprise me if their show was to broadcast on 2GB and 3AW simultaneously, with possibly 4BC as well. That said, I don’t expect much of 3AW’s lineup to change.

This all hinges on the approval of existing shareholders (a vote will be held in March) and regulatory approval which shouldn’t be difficult given the sales of 96FM, 2CH and MRRN.

Interesting times in talk radio in Australia are certain in 2015.

Samuel

Entry Filed under: TV/Radio/Media

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