EDITOR’S COMMENT: Mergers affect foot soldiers as well as captains

How should we, the foot soldiers in this grand media battle, react to the proposed merger of UK media giants such as Carlton and United News & Media?

How should we, the foot soldiers in this grand media battle, react

to the proposed merger of UK media giants such as Carlton and United

News & Media?



There is a tendency to feel that these things go on above and beyond our

sphere of influence or relevance - as if the Michael Greens and Lord

Hollicks of this world are up in the gods and we are just playing out

their games on a stage down below.



But, forget all that Shakespearean guff for a second because this merger

- if it were to go ahead - would have a direct impact on each and every

airtime salesperson and most media planners and buyers too.



Commercial TV companies enjoy a total ad revenue of around pounds 3

billion in the UK. This income is effectively split between seven sales

points, of which Carlton and UNM are two of the largest. By reducing the

number of sales points, this merger would have a major impact on the

trading process.



Even if the two companies are not allowed to break the regulatory

authority’s 25 per cent share of ad revenue rule, they would still have

an ominously powerful selling position, offering buyers a package

including Carlton, Central and Meridian.



It will not affect the negotiations for the coming season but it could

have a major impact in 2001 and 2002. Ad sales teams from a combined

Carlton UNM would seek to position the company as the first port of call

for all buyers, expecting the rest of the schedule to fit around their

offering.



Sales people everywhere could find their margin and share squeezed. Even

the Granada Media Sales team would be up against it, although the

Granada guys up in the gods will surely announce their counter-attack

strategy soon. What money a Granada bid for UNM?



But at least the foot soldiers need not start panicking about their

jobs.



Although these mergers can produce ’operating efficiencies’, they rarely

trigger firings. Even the enormous US mergers between Time Warner and

Turner, and between Disney and Capital Cities/ABC have had negligible

effect on the size of their media sales teams. These mergers are all

about growing companies - and who would shrink his team of revenue

generators in a period of growth?



But all this talk of UNM and Carlton may well be nothing more than a

preamble to a bigger story. By the time Media Business lands on your

desk - this column goes to press on Wednesday - it seems inevitable that

other media groups will have stepped into the fray with their own

proposals for mergers.



Keep an eye on the papers and on your trade magazine. This isn’t job

threatening stuff, but if you’re selling airtime it will mean more than

just a new name over the door.



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