By all measurements, it’s a big
failure for the Nine Network’s new management team. The latest figures on advertising
revenue for the industry show Nine losing share, with Ten,
and even Seven gaining ground on Nine in the second half of the year.

After two years of polishing the
floor with Seven, fighting off a rising Ten and withstanding the impact of
Seven’s Olympics, the Nine Network’s share of the national TV advertising spend
fell to its lowest level in four years in the six months to December.

The Nine Network took a 37.61% share
in the December half, a rise of 8.42% on the same period a year earlier.

But in the greatest concern, the
Network’s share fell from the 40.1% achieved in the first half of the year to
the 37.61%

A year earlier, in the closing
months of 2003, Nine’s share was 38.3%.

So it rose past 41% in the first
half of 2004 and then fell in the second half, a situation that would perplex
most managers.

What makes it even more galling is
that the last six months of the year are the best for commercial TV. Revenues
soar with the Christmas period and so it did in the last half of 2004. From the
$1.54 billion spent on commercial TV in all markets in the six months to June,
advertisers opened their wallets and the amount spent jumped to $1.89 billion,
a rise of almost 24%.

So while the market grew sharply in
the six months to December, Nine’s share actually shrank, not the sort of news
Kerry Packer likes to hear. Nine failed to convert or maintain
the revenue share it wants based on the ratings supremacy it had over the year (it won every week nationally).

There’s been a sort of mantra at Nine and PBL for a while of wanting to have a 40% share of
the ratings and the ad spend. Both are now under serious threat,
the decline in the share of ad spend coming before a
decline in summer and so far in official ratings, in viewer numbers as the
Seven Network fights back and Ten maintains its “bigness” attack this
year.

That dip was bigger news than the
confirmation that the Ten Network’s share rose past Seven’s
in the six months to December, according to figures from the industry lobby
group, Free TV Australia.

Ten was the biggest beneficiary in
the latest six months, its share rising to 31.47%, up 14.05% on a year earlier.
Ten’s share in the first half was 30%.

Seven saw its share reach 30.92%, up
9.42% on a year earlier. Its first half share was 29.9%, so it
and Ten have benefited from Nine’s loss of share. Seven was helped by the Olympics
revenue, but that wasn’t enough to stop Ten climbing
past it.

Ten was the only one of the three
commercial networks to grow its revenue faster than the 10.45% growth in
network revenues in the six months to December.

Metropolitan revenues jumped from
$1.199 billion in the first half of 2004 to just over $1.501 billion, a
significant level of growth and that the Nine sales
force and new management team could not maintain its 40% share in such a
bullish market is a sign of problems at Willoughby.

It is also signs that advertisers
wanted to keep Seven in the game and probably gave that network more revenue
than its ratings performance entitled it to.

Now with ratings on the rise and a
couple of Blockbuster programs in Desperate Housewives,Lost, and locals
including Dancing with the Stars, Seven hopes it is poised to lift its share
and challenge Ten for second place.

Nine’s problems are compounded by
the fact that its growth rate of 8.42% was below that of Sydney (9.80%), Melbourne (9.80%) and Brisbane (11.99%).

While Seven
had been snapping at Nine in the Sydney market in late 2004, Nine was the
clear winner in ratings terms in Brisbane and Melbourne.

Performance of the networks in each
market was not detailed in the report.