Originally Posted by
mistaTea
The only rationale that holds any weight for Sky buying MW is that that the two companies can grow advertising revenue significantly together. Businesses will find Sky TV the 'no-brainer' to go to for their advertising because they can offer bundles across TV, radio and billboards - which would ensure maximum reach with one convenient bill.
That is great, but how much upside to revenue can we really expect from this?
Even if they boosted ad revenue by a whopping 20% (a Herculean task at the best of times, near impossible in this inflationary environment with possible recession looming) that would be maybe $50M more revenue. I mean, the upside just isn't enormous...yet the risk is very high (and certain if we overpay, which I am sure Sky will).
Any notion that owning a radio station and some billboards will make us a more attractive prospect to content partners (particularly sport) is just wishful thinking. No doubt this angle is being pushed by the 'helpers' on Page 12 of their glossy presso...
"Hey NZR! You really REALLY wanna go with us even if we won't offer to pay the most because now we can reach every single home AND car in NZ!!". I mean, come on.