Will Australia’s free-to-air TV really be in ‘diabolical trouble’ without gambling ad revenue?

If you watch free-to-air television in the evenings, it’s nearly impossible to avoid the constant stream of gambling ads, with most promoting online gambling platforms. Broadcasting authorities report that gambling ads on free-to-air TV peak between 7 pm and 10 pm, during which 22% of all such promotions air.

Between May 2022 and April 2023, over half a million (504,100) gambling ads were broadcast on metro TV. Of these, 51% promoted online gambling companies, 20% were for lotteries, and 17% for lottos.

The harmful effects of gambling addiction are well-documented, with the social damage often extending beyond the individual to affect families and communities.Last year, a total ban on gambling ads was proposed by a bipartisan committee led by the late Labor MP Peta Murphy, but it appears the Labor government is set to dilute that proposal, opting instead for a partial ban.

What do the TV networks say?

Australian television networks have informed the government that they are heavily reliant on advertising revenue from gambling advertisers to stay competitive.

Without this revenue, networks Ten, Nine, and Seven claim they might need to reconsider whether they can continue funding local news bulletins. This was one of the dramatic claims made this week by media companies and the Albanese government. They argued that banning all gambling ads, as recommended by the Murphy inquiry, would render the free-to-air TV industry unsustainable.

Bill Shorten even stated that the broadcasters are in “diabolical trouble” and require gambling ad revenue “just to stay afloat.”

How much do broadcasters earn from advertising overall?

Recent figures show that the total TV advertising market, which includes all metropolitan free-to-air, regional free-to-air, and catch-up TV, generated $3.3 billion in revenue for the 2024 financial year.

This amount, down by more than $250 million from the previous year, is shared between Seven, Nine, Ten, and their affiliates.There are no available figures showing how much each network earns individually.Free-to-air television is being challenged by streaming services like Netflix and a sluggish advertising market. Shorten is not entirely wrong when he says the networks are in “diabolical trouble”; on Wednesday, Seven West Media reported a 69% drop in profits.

However, it’s not all bad news. Nine Entertainment reported strong advertising revenue from the Paris Olympic Games, bringing in $160 million over the two weeks.Still, the advertising market is down 8.1% compared to the same period last year.

How much of the $3.3 billion comes from gambling ads?

The Australian Communications and Media Authority estimates the figure at $162 million, which is not a large portion of the $3.3 billion.However, the commercial TV lobby, Free TV, disputes this figure, arguing that the real amount is closer to $200 million.

“At a time of increasing pressure on commercial television broadcasters, who have to fund all of their operations through advertising revenue, that’s what we’re required to do under our legislation, every dollar matters,” said Bridget Fair, CEO of Free TV, on ABC Radio.

“The conversation we want to have is: how are we going to ensure that the sector remains sustainable, so that every Australian can continue watching the Olympics, like we’ve just seen for the last two and a half weeks?”

What do gambling opponents say?

Charles Livingstone, an associate professor at Monash University, argues that a partial ban on gambling ads is insufficient.

“Broadcast media and sporting codes claim an ad ban would deny them needed revenue,” Livingstone said. “But the cost of this concession to vested interests is continued harm to families and communities.”

Green Senator Sarah Hanson-Young asserts that Australia can support sport and public interest journalism without relying on gambling advertising.In June 2023, the Guardian announced it would no longer accept gambling advertising across all of its global platforms.

Hanson-Young stated, “Experts have told us we need to ban gambling advertising, like tobacco ads.”

She added, “Labor will be tested on this question in the Senate when Greens amendments for a full gambling ad ban, in line with the Peta Murphy recommendations, are voted on.”