Additional Estimates - Tuesday 14 February 2012 - Special Broadcasting Service Corporation
CHAIR: Welcome. Mr Ebeid, do you have an opening statement?
Mr Ebeid: Yes, I do. Since the last Senate estimates, I thought I would update you on three key things that have happened. We have had a terrific start to the year with the success of Once upon a time in Cabramatta, which aired in January. It was a three-part documentary series that charted the course and the struggles of the Australian-Vietnamese community through their experiences in the western Sydney suburb. Community members offered touching and heartfelt accounts of the events that shaped their lives and their families. Of course, as you know the Cabramatta community has endured much hardship over that time and it was certainly the backdrop of Australia's only political assassination.
We had terrific results both on TV, with almost two million viewers over the three episodes, and online. Also, our community outreach program, which we did through the Lunar New Year, really extended both the reach and the impact of the program. What was involved was the community members were able to record their stories and memories about Cabramatta, which has been collated to become a permanent resource, not only for the community, of course, but for generations to follow. The series was a true cross-platform effort for SBS across television, radio and online. It really shows that SBS is excelling. It is starting to think beyond traditional platforms to deliver audiences compelling content using our new technology. It has also been a great example of how SBS has been able to use traditional forms such as documentaries to tell compelling and charter based content that resonates with the mass audience. That has been terrific for us as well. It builds on our considerable success with things like Go back to where you came from, which was very successful for us late last year. The Vietnamese community has been overwhelmingly positive with the program. In fact, SBS will be presented with a plaque by the New South Wales chapter of the Vietnamese community to mark their appreciation. It is this sort of appreciation from the community that keeps our staff very passionate and motivated to do more of this sort of thing.
The second thing I was going to highlight was around our World News Australia. We have updated our World News set, which has been terrific for us. At the same time we launched our new fully automated studio for news operations, which will start to give us some operational efficiencies in the following years. The new news set and the new format and the automatic studio were launched last Monday. We are pleased to say it has gone off without technical glitches, which is normally the case when you do things like this. It is going to allow us a lot of interactivity for our news bulletins and it will open up new and exciting things for us, particularly with new and large news stories and events. It is an ambitious project and we are very pleased with it to date.
The last thing I would update you on is that, late last year, SBS also launched a new mobile app for our radio audience. It is called the Your Language app. It allows our radio audience to get their language program at a time that suits them-very much on demand on the mobile phone. They can also get previous programs that they may have missed. It is truly on demand. It is a modern incarnation, if you like, of our radio services that we started some 35 years ago. I think it will also give us a great platform to be able to provide new language services for communities that we do not currently serve should funding become available so that we can expand this important initiative for more language groups. Those are the three key things I thought I would update you on.
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Senator LUDLAM: I am going to change the subject and put some questions to you about the running of the station, in particular your financial position. Are you familiar with the SaveOurSBS group?
Mr Ebeid: Yes, I am. I have met with them a couple of times since I have been in the position.
Senator LUDLAM: Okay. They put up a budget submission which they have sent to the Minister for Finance and Deregulation dated 19 December 2011. It runs a graph of growth in your advertising revenue from financial year 2002-02 to 2010-11 which shows it effectively falling off a cliff and going into negative territory 2009-10 to 2010-11. Are you familiar with what I am talking about?
Mr Ebeid: I am sorry; I am not. I have not seen that graph or their actual submission either.
Senator LUDLAM: All right. I will point you to it. It is worth a look. It is very detailed.
Mr Ebeid: Are you saying that the advertising revenue is falling off a cliff?
Senator LUDLAM: Yes-and the growth. It is a graph of growth of advertising and sponsorship and shows that you are falling into negative territory. Is that your experience from running the station? Are you concerned about what has happened to your advertising revenue? We have touched on this briefly before. Where is it going in the next couple years?
Mr Ebeid: Yes, I am concerned about our advertising revenue. It has been declining. For the first time in our history, this year we will be doing about $5 million less than last year. If I were to look at our forecast, compared to 12 months ago, this current year we are down about $16 million from where we thought we would be on advertising revenue. We are in a greater negative growth than the average for the industry. We are down about 13 per cent, and I think the industry on average is around minus three from my understanding.
Senator LUDLAM: Last time we spoke we talked a bit about the reasoning behind that, and you expressed a couple of factors that you thought were contributing, particularly around digital multichanneling and other stations bidding up the price of content. The price of advertising is also falling because there is so much more air time to fill. I want to run over that ground again but, more, what does this do to the finances of the station? Are you running at a deficit? What do you think is the solution?
Mr Ebeid: We ran the organisation at a deficit last year, and I would expect that this year will probably be at a similar level-maybe a little bit worse. We have been trying really hard to live within our budgets and balance our budgets. We have had to make some very tough decisions. Most recently, over the Christmas period we had to put about 15 of our language groups into recess to try to save a little bit of money. Many radio stations do that over a summer period, but it was the first time in SBS's history that we have had to do that. That was one thing. Services have been decreasing on that front.
We have also been looking for efficiencies internally. One of the things that is affecting our TV schedule at the moment is an increase in our repeat levels because we are not purchasing as much fresh new content as we would like. Our repeat levels are up as well.
Senator LUDLAM: I worry about the station going into something of a death spiral in the sense that falling advertising revenues mean you have to put more repeats on, quality of new production decreases, that drives people away to watch something else and you end up in a vicious circle. So where is the station going?
Mr Ebeid: I share your concern; however, I am confident that we are working at the moment with the government and with our department on next year's budgets. All that is being discussed at the moment, and certainly the minister is well aware of the situation we are in.
Senator LUDLAM: Actually, he is studiously ignoring our conversation.
Mr Ebeid: I am sure he is sending messages to get the money for us!
CHAIR: That's optimism at work! That is good.
Senator LUDLAM: We can fix this live at estimates!
Mr Ebeid: But we are in the middle of budget discussions at the moment, which does make it a little bit difficult for me to talk about it. I think the issues that we are facing at SBS are well understood by the government and the department, and we are working through that at the moment as part of our normal budget cycle.
Senator LUDLAM: Okay. What can you tell us about a proposal-I do not know if it is overdoing it to call it a 'proposal', so perhaps 'negotiations'-for a tie-up between SBS and NITV? Can we drag that out of the domain of rumour? Is that happening or in the works?
Mr Ebeid: We talked about that at the last Senate estimates. The government had requested that SBS and NITV go into conversations together with our department. We have been doing that. We have been working diligently to understand how we might be able to launch a new free-to-air Indigenous service on the budgets that are being discussed at the moment. I am confident that we will be able to reach a good agreement on that, and we are working with the minister and the department to make that happen at the back half of this year.
Senator LUDLAM: Are you in a position to hitch another wagon to SBS? I think it would potentially be a good move; you get economies of scale-
Mr Ebeid: I think it would be very exciting for SBS if we could do it.
Senator LUDLAM: but, given the rather distressed state of your finances that we have just been discussing, how do you propose to take on another commitment like that?
Mr Ebeid: That is why it is all part of the budget discussions that we are having at the moment. Yes, I would be concerned if we were just taking on a new service like that, particularly on the same budget dollars that NITV currently have without some additional funding for SBS. We are working through that at the moment.
Senator LUDLAM: All right. I wish you well in your search for proper government funding.
Mr Ebeid: Thank you.