March 27th 2004

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Articles from this issue:

COVER STORY: The PM, farmers, the FTA and the election

EDITORIAL: Telstra has lost its way

CANBERRA OBSERVED: Spending signals start of election campaign

ANALYSIS: Australia-US trade deal a monumental folly

STRAWS IN THE WIND: Lilies of the field / Speaking conspicuously

MURRAY RIVER: Science overturns need for big environmental flows

INDONESIAN ELECTIONS: Indonesia taking control of its own destiny

How alcohol leads to harder drugs (letter)

The Passion of the Christ (letter)

DOCUMENTATION: IVF - Playing against a stacked deck

MEDIA : Join the Fairfax Club

ASIA: Behind the India-Pakistan thaw

ECONOMICS: Eight centuries of wavy prices

BOOKS: JAMES BURNHAM, by Samuel Francis

FILM REVIEW: Shattered Glass

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Join the Fairfax Club

by Tim Wallace

News Weekly, March 27, 2004
Join the club

Does Fairfax chief Fred Hilmer watch Channel Ten? A few years ago he shared with a Senate Committee inquiring into cross-media ownership rules his desire to partner with a commercial television station. "Any network that we combined with would have stronger content as a provider of news and a number of other programs," he said then, and nothing since, to suggest a change of heart.

Ten is the network most likely to be the object of Hilmer's attentions. Given it has built its profits on youth-orientated fare like the "reality" franchises Big Brother and Australian Idol, it might seem an odd fit with Fairfax. Nonetheless the two organisations have already been flirting with "editorial synergies" through the Australian Financial Review Market Wrap program, a somewhat lacklustre stockmarket report that must leave the average Ten viewer reaching for the remote control.

Reality television

Viewers have, in any event, been finding other reasons to change the channel, with Ten's new "reality" offerings The Hot House and The Resort plumbing new lows in entertainment value and garnering ratings to match. (Canon, a major sponsor of The Resort, might well be reconsidering its assessment of the "voyeuristic island adventure" as "an ideal vehicle" to demonstrate "the benefits of our digital imaging technology".)

The Resort, a cross between Renovation Rescue and Temptation Island, purports to set "15 ordinary people from very different backgrounds" to the task of turning a dilapidated Fijian island resort into a going concern. Not that the telegenic hunks and babes are ordinary or very different, except of course to the type of people you might actually choose if you were opening a real resort).

They share a striking uniformity: young, ambitious, single and attractive with their clothes off. Of the eight women in the group, two are former strippers and another is a beauty queen who cites her dream job as sunbathing - career choices hardly representative of any women I know.

But given their disparate skills - acting, singing, juggling, weapons location, combat surveillance and exotic dancing - it should hardly come as a surprise they are making a hash of resort management. In the first five weeks of the show, the group has elected and then dumped two general managers. Meanwhile the business, like the ratings, is going to hell.

Fairfax management has been making a similar hash of industrial relations. Continuing in its recent tradition of provoking strife, the company announced on February 3 its decision to dismiss 86 printing and maintenance staff from its Spencer Street plant in Melbourne, despite the fact this breached the enterprise agreement that still has more than a year to run. Unsurprisingly, the printers went on strike.

The company said it expected to realise annual savings of about $3.5 million by voting the printers off the site, with the net cost of the closure in the second half of the 2004 financial year being $6 million to $10 million. The costs are now likely to be much higher. The Age lost a reported $5.5 million due to the disruption of its February 6 edition, and the company has been ordered by the Australian Industrial Relations Commission to cease its actions.

The issue has also aggravated old sores and contributed to unease among the rest of the workforce. According to Paul Robinson, the chairman of The Age union house committee: "This attempt by management to go back on its word has led journalists to question the sanctity of their own recently negotiated enterprise agreement."

The Board

One of the problems with the Fairfax board is that, like the team from The Resort, it contains no one with any previous practical experience in the business at hand. As's Hugo Kelly - whose decade as an Age journalist gives him a decade's more practical media experience than the nine directors in charge of Fairfax's fotrunes - recently put it, the board is stacked with corporate stiffs who spend their time shuffling between lucrative part-time directorships.

Hilmer, whose $2.2 million salary package should be enough to warrant his undivided attenton, still manages to find time to be deputy chairman of Westfield Holdings. The chairman of the Fairfax board, Dean Wills, a former chairman and managing director of Coca-Cola Amatil, also sits on the Westfield board (as well as chairing the Transfield board). David Gonski, the current chairman of Coca-Cola Amatil, and of Investec, sits on the board of Westfield too.

Gonski is also on the board of ANZ, as is Margaret Jackson, who chairs the Qantas board and is a director of Billabong as well. Roger Corbett is chief executive of Woolworths. Julia King is a director of Servcorp and Opera Australia. Mark Burrows is deputy charman of ING Barings, Brambles and Burns Philps. Ron Walker is chairman of the Australian Grand Prix Corporation and the Melbourne Commonwealth Games, and deputy chairman of Primelife. Roderick Carnegie, meanwhile, founder of the Australian practice of management consultancy McKinsey and Company, where Hilmer was managing partner for nine years.

This isn't so much a resort as a club.

  • Tim Wallace -

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