“The industry is going through an issue where traditional media and revenue are getting more difficult, we thought that if we’re going to change the company and pursue the next phase of some growth we had to change the way we do business.
“To do that we needed an agent for change, an agent who understood the industry, who understood revenue, who understood the elements that gain you revenue as well as the adjacencies going into the future.”
Mr Warburton and Seven were involved in a protracted legal dispute in 2011 when he jumped ship to Ten. He was ultimately prevented from starting at Ten until January 1, 2012. He was touted as a replacement for then-Seven boss David Leckie.
“James and I settled all that stuff years ago. After James left Channel 10 we sat down together and put that behind us years ago,” Mr Stokes said.
Mr Leckie, who was involved in Seven and Mr Warburton’s legal stoush, said he had great admiration for everything the new CEO had achieved.
“A lot of people will say James and I are enemies because we went to court against each other. Nothing could be further from the truth,” he said.
“I started him out and to this day he is a great friend and extremely good at whatever he does. He is an unstoppable salesman.”
Seven will report its full-year financial results next Tuesday. The broadcaster has been at the whims of the toughest advertising market since the global financial crisis, which forced the broadcaster to downgrade earnings in May, and despite strong performances in news and sport, has underperformed in prime-time against the likes of Nine’s Married At First Sight. Nine owns the Financial Review.
“No one could have asked anyone to have done more or worked harder for Seven than Tim [Worner] has – 25 years he’s been with Seven … the last six years as CEO. He’s done a wonderful job as CEO of Seven,” Mr Stokes said.
“But, Tim’s major skills, I think, are in television production, and that’s the area he actually hasn’t been involved in because running the company is taking him away from that and we needed to reset and look at the future. We decided that revenue focus is more important than the rest of the focus and it became obvious we needed to make a change.”
Mr Stokes said the process to find a replacement was done in conjunction with Mr Worner until a decision was finally made on Thursday night. Mr Worner did not return calls on Friday.
During his time at Seven, Mr Worner was embroiled by an affair he had with executive assistant Amber Harrison, which became public in late 2016. It involved a long legal battle between Seven and Ms Harrison.
Over the past 18 months, Mr Worner has led Seven’s efforts to reduce its sizeable debt and cut costs broadly across the business, something the network is expected to update the market on next Tuesday.
Mr Warburton, who was contacted about replacing Mr Worner last week, will be tasked with driving new revenue streams into Seven, which has been heavily reliant on free-to-air advertising, which has remained under pressure, for its earnings.
Mr Warburton left Ten in 2013. He then worked as chief executive of V8 Supercars until late 2017, when he moved to APN Outdoor. He instigated a turnaround at the outdoor advertising business before it was sold to French giant JCDecaux for $1.2 billion.
“Everyone knows my absolute passion is media,” Mr Warburton told the Financial Review.
“I’ve always strived to work in it, whether that’s been in television or in outdoor, as was the case at APN. There was no doubt what I’d been working on privately was all media related, so whilst the opportunity happened very quickly, it was a no-brainer.”
Mr Warburton said the two elements to Seven’s strategy would be the core businesses in television and West Australian newspapers, and the “transformational pieces”.
“There’s a strong hunger in the organisation to look at additional platforms and to look at those transformational pieces. It’s really an opportunity to take the incredible assets we’ve got and then think about how we broaden it and transform the company, which is something I’ve had a lot of experience in, in the past seven years,” he said.
Changes to media ownership regulation in 2017 were predicted to instigate a wave of media consolidation. So far, the only deal has been the merger of Nine and Fairfax Media in 2018. Mr Warburton said he wasn’t ruling anything in or out at this stage.
“For us, it is as much about growing the top line with more revenue and improving the core at the same time, so we’re very open to opportunities. Perhaps, we need to be entrepreneurial in some areas and obviously we’re well and truly open for business,” he said.