Page 10 - Fujifilm Exposure_10 Longitude_ok

THE ART OF BUILDING
THE ART OF BUILDING
Flextech leads the way in the multi-channel TV market place
H ands up who’s heard of Flextech? The PLC boasts a soaring share price and a healthy year-on-year profits increase. Then there’s compelling evidence it is the “most watched” company in, as well as the leading supplier of basic tier chan- nels to, the UK pay television market. Yet Flextech’s public profile seems almost determinedly
low. You could say, it lets the handset do the talking. In fact, you may already be a devotee of its whol- ly-owned channels - Bravo, Trouble, Challenge and Living - not to mention UK Gold and UK Style, just two of Flextech’s quintet in a trailblazing joint venture with the BBC. But odds are the company still res- olutely remains to many something of a shadowy player in a high-stakes Pay-TV game where Sky’s
clearly not the limit.
So let’s first examine the pie chart which, in
1998, gave Flextech 25.9 per cent of basic viewing in multi-channel homes - that’s equivalent to 14 million adult viewers a month. The remaining slices belonged to Sky Basic (23.6%), Viacom (14.5%), Turner (10.6%) and Others (25.4%). The present explosion of digital services will mean more distribu- tion and a growing subscriber base as surely as temp- tation follows technology. All right, call it “choice.”
The number of pay television subscribers in this country has more than doubled in the past five years - from three million in 1995 to just short of seven mil- lion today. Which also rather conveniently brackets the current tenure of New Zealander Brent Harman as managing director of Flextech Television.
Harman, 48, from a background in print journal- ism - including a stint in the parliamentary press gallery - moved eventually to administration, first with Radio New Zealand then Television New Zealand, the two network commercial channel. He was TV NZ’s second chief executive following Julian Mounter who had been responsible for, among other things, introducing an international dimension to the service. TV NZ went into Australia and established its own transmission arm and also started to build up contracts there with a vengeance. With Harman at the helm, the emphasis was also very much on devel- oping the enterprises/marketing side as well as drama and natural history.
Then in 1995 came the overseas offer he simply couldn’t refuse following contacts with Flextech’s then deputy chairman (now chairman) Adam Singer who began to wonder politely if Harman would like to work in the UK.
Recalls Harman: “In those days Flextech was an entrepreneurial but still quite small company with two wholly-owned channels and some investments. It was a meaningful company but not yet exactly a major player. I came over here and saw the state of the growing Pay-TV market and realised pretty quick- ly that this was the way the world was headed so hap- pily accepted the job of managing director.
“The company wanted to grow its portfolio of channels and give them substance in the multichan- nel market. They were all, not unexpectedly given that particular stage of their life cycle, losing money. Looking back four years, digital was certainly on the
horizon but even then it was largely seen as being a means of delivering High Definition TV and not really as a way of distributing greatly expanded numbers of TV channels. Analogue was still seen as the medium for broadcast for the foreseeable future.
“That,” smiles Harman in reflection, “changed quite quickly to the point that now, for instance, Sky is talking about having two million digital subscribers by the end of this year: these are huge numbers. Cable channels are all rolling out digital and interactive TV is starting too. It was a question of establishing Flextech in a strong enough position so that we could take advantage of whatever opportunities came along.
“In fact, I hadn’t been here more than a few months when we were already in negotiation for the acquisition of 20 per cent of Scottish Television. Soon after that we were sitting down with the BBC in ten- tative discussions about how we might participate in growing their archive of programmes into channels in the UK. The BBC had already been thinking about this so we can’t claim any credit introducing them to the idea. Also along with Cox and Pearson, we were also shareholders with the BBC in UK Gold. So we were already a partner with the BBC to that extent. Those discussions continued until March 1997 when we finally concluded negotiations for UKTV.
“How’s the BBC as a partner? Because of its size, the complexity of its politics, the interests of a range of different departments within the Beeb and because of its requirement and need to be dealing on a fair market basis with any party, the process was long and drawn out. Getting to an agreement - our
EXPOSURE • 10 & 11