media listings lift on hope of change

"...internet service providers such as Telstra, Optus and iiNet could benefit indirectly from the slow shift to digital television as IPT was taken up..."

Media listings lift on hope of change
By JAMES McCULLOUGH
14jul06
INVESTORS welcomed yesterday's long-awaited proposed changes to media-ownership laws, sending publishing, TV and radio stocks higher in an overall lower market.

Investors remain convinced perennial takeover target John Fairfax Holdings - along with Southern Cross Broadcasting - would be snapped up under the proposed legislation.

The Fairfax share price surged 6 per cent, closing up 23c at $4.13 on volume of 17 million shares while Southern Cross Broadcasting - owner of Channel 9 in Adelaide - leapt 8 per cent, the shares up 85c to $11.85 on volume of 630,000 shares.

Communications Minister Helen Coonan unveiled the changes which include lifting foreign ownership restrictions and easing cross-media ownership regulations.

All the listed media stocks - except West Australian Newspapers rose on the news.

Media analyst Peter Cox said Fairfax and Ten Network were the two standout takeover targets, both boasting relatively open share registers. There has also been constant speculation of Channel 10 getting together with Fairfax and several foreign players, along with Macquarie Media, to run the slide rule over Seven Network.

The share price of Ten rose 13c to $2.98 while Seven lifted 20c to close at $8.62.

Mr Cox saw PBL as one of the big winners from the proposed changes. It rose 42c to $18.41.

"Packer is the major potential winner," he said of PBL executive chairman James Packer.

"They are protected as far as multi-channelling not coming in: in any major scale, they are protected by the fact there is no fourth commercial network and they are protected by the fact that . . . datacasting once again appears to be so limited that it is certainly not going to be a threat to their main free-to-air operations."

News Corporation, publisher of The Advertiser, was also viewed as a winner, its share price surging 16c to $26.83 and its non-voting shares gaining 21c to $25.49.

Senator Coonan also announced the changeover date for digital TV would be moved from the end of 2008 to between 2010 and 2012.

Independent media and telco analyst Paul Budde said that represented a lost opportunity for consumers.

By 2010-12, he said, digital technology was likely to have been superseded by internet-protocol television services. Still, internet service providers such as Telstra, Optus and iiNet could benefit indirectly from the slow shift to digital television as IPT was taken up.

Despite the senator's media-framework plans, she faces hurdles in implementing the proposed changes: National Party renegade Senator Barnaby Joyce already has indicated he may vote down key proposals in the media package.

The Labour Party also has voiced opposition.