Quick smart Aussie roars to rescue

MATT NIPPERT
Last updated 05:00 17/08/2014
Rod McGeoch
CHRIS SKELTON/Fairfax NZ
ROD MCGEOCH: 'My wife says I’m the most competitive person in the world, and I might be – I don’t know.'

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Tanned and cocky, Rod McGeoch punches his open palm for emphasis, roars like a bull at his own jokes and strides around Auckland's waterfront as if he could straddle the Tasman.

He modestly declares: "My wife says I'm the most competitive person in the world, and I might be - I don't know."

The professional director who rose to prominence successfully spearheading Sydney's bid for the 2000 Olympic Games, settles this question in the affirmative when later asked if he has any plans to slow down after recently reaching the qualifying age for a pension.

"I'm still fit, I reckon I'd still win the father's race if I ran it at school. I still run. I am 67, and I'm certainly not intending to stop."

A former director of Telecom and due to stand down in October after a dozen years on the board of SkyCity, Sydney-based McGeoch has managed to find yet another role to keep him regularly travelling to New Zealand.

Last year a consortium of banks and vulture funds, weary of playing banker to a regularly defaulting MediaWorks, pulled the pin and appointed receivers to engineer direct control of the broadcaster. It owns TV3, TV4 and a string of radio stations including The Edge and RadioLive.

McGeoch was the man they called to see what they could salvage from their $797 million in loans.

The company had become a financial basket-case in recent years, saddled the aforementioned debts, a stagnant advertising market and onerous content deals.

Nevertheless, McGeoch jumped at the chance last year to be chairman. "It's an enormous challenge. Very satisfying if you're able to do it," he says.

Of course, he freely admits this sort of role - working for private bankers and fund managers - combines great difficulty with the possibility of great reward.

"But you can also be remunerated, linked to success. Inside a public company these sorts of things are not acceptable. I quite enjoy that challenge."

McGeoch, who is involved with a number of private equity firms in Australia, is understandably positive about their influence on business - even where the industry is something out of their comfort zone.

"What private equity has taught me is that bright fresh minds can sometimes do better than owners who have had the business for a long time. There is a message there about incumbency ultimately, possibly, clouding clarity. Whereas new money in, which is wanting a return bloody quick-smart, seems to get strategic change which is more often than not beneficial."

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And what qualified the Australian for this challenge? The chairman admits his knowledge of broadcasting and journalism is "narrow, that's for sure".

He cites his time at Telecom as a stepping stone, where discussions a decade ago of a triple-play internet-phone-television bundling led to him raising the possibility of the telecommunications giant bidding for the rights to screen the All Blacks.

Of course, Telecom under his watch didn't buy the rights to the All Blacks. Or get into content. McGeoch freely admits having missed this trick.

"We probably weren't strong enough on that board in terms of thinking about the future - you've put me in the right box," he says.

McGeoch says the reason he was picked to helm MediaWorks was more due to legal troubleshooting than technology forecasting. "I'd been chairman of a listed property company, I think they thought there were certain legal property things where I could make a contribution."

These "legal property things" were multi-year output deals with heavyweight American studios such as NBC-Universal, CBS, Sony and Fox who provided the bulk of TV3 and TV4s programming.

"I was given a consultants report," he says. "It became the bible for a while as to what were the problems with MediaWorks, and it turned out to be substantially correct. And the Hollywood contracts were right there at the top," he said.

McGeoch flew to Los Angeles with a trump card in his back pocket. MediaWorks' receivership meant transferring contracts to the new bank-run iteration of the company was an entirely optional affair.

McGeoch is unapologetic at ripping up contracts. "I looked at the figures. Between 2008 and 2012 I think our revenue was off 15 per cent, and our costs were up 100 per cent. I said to them: ‘How long do you think we're going to be buying your product?' And they just didn't want to know."

Most of the studios eventually renegotiated. McGeoch says "they weren't entirely without common sense".

But Fox held out and abruptly yanked programming. "One can't be too smug about this, because you just don't know who's going to have the last laugh."

He's leaving the heavy lifting to Mark Weldon, the former NZX boss whose appointment as MediaWorks chief executive raised eyebrows in the media industry, but has some novel ideals of his own as to the company's future.

"It's public knowledge we and others are saying: ‘News departments in radio and television? One could surely do both.' So there's possible consolidation there, on the costs side more than anything," he says.

He floats the idea of turning The Edge radio station into a television station, speaks about the possibility of trans-Tasman channels and talks up MediaWorks raising revenue from events.

"There's lots of things people are exploring," he says.

As for the future of free-to-air television, McGeoch recounts the advice of high-flying consultant David Leckie of the Seven Media Group, who was brought in to assess MediaWorks.

"He's passionate about the everlasting strength of free-to-air television. It's the only thing with a national footprint, where national advertisers get a bang for their buck across the whole country," he says.

McGeoch acknowledges Leckie's vision is an outlier in an industry dominated by talk of further audience segmentation. "It kind of feels as though the world's not going there, but I'm not quite sure," he says.

Chairing boards is a long way from when McGeoch smoked roll-your-own cigarettes and worked on a construction site at the age of 21 while putting himself through law school at the University of Sydney.

"I'm from a very modest background where everyone had to work. I had a brother and sister behind me, so I went to work in December 1963 on the jackhammer."

Graduating and becoming a partner at a law firm the year after the jackhammer job, his subsequent appointment to president of the Law Society of New South Wales at the age of 30 - "the second-youngest ever," he adds - helped fuel his superabundant confidence.

Being picked in 1991 to manage Sydney's bid for the 2000 Olympics proved a rude shock to the ego. A news conference to announce his appointment saw him peppered with sports questions from journalists incredulous the position had gone to a lawyer and not, say, a former Olympian.

"The next morning the three Sydney newspapers had the biggest headlines you'd ever seen. It was like war had been declared. And The Telegraph had ‘ROD WHO?'. Talk about humbling," he says.

He obviously loves this story - mainly because it puts doubters in their place.

The success of the Sydney bid - an event that hasn't seen venues turn into unused structures reminiscent of the post-apocalypse as with other host cities - helped McGeoch's profile and ensured he'd never be ‘ROD WHO?' again.

And he seems keen to emphasise the point, dropping names like so much celebratory confetti. Examples: "My great friend, Sir Dryden Spring…"; "Peter Costello, who I know quite well…" and "I was sitting next to Kerry Packer and he said…".

He also casually drops the name of Mel Gibson, from whom he solicited a A$1m donation for the dramatic arts, in cementing his straight-talking credentials.

"I'm the only chairman of the National Institute of Dramatic Art who refuses to go to a Shakespearean production. I never did enjoy writing in a metaphor, I prefer it in plain English."

And he's especially plain defending SkyCity's controversial deal with the Government over the building of the New Zealand International Convention Centre. Last week the casino operator bumped up the cost of the planned project by $100m to $500m.

The kerfuffle in New Zealand ignored the fact commercial negotiations between state and casino are more common internationally, McGeoch says.

"Elsewhere in the world, particularly in Australia, it has become imbedded in all parts of politics. It goes ‘this is a tourism matter, it's not a gambling matter'."

Casino regulatory regimes typically come with exclusivity deals, cutting out competition in a territory, and the duration of that exclusivity becomes a valuable bargaining chip for governments, he says. "Exclusivity comes with an expiry date, and you don't want it to expire. You can bet your bottom dollar politicians are asking ‘What sort of cheque are you writing before we give you that?' That bargaining is inevitable. It has to be transparent, and it has to work for both sides," he says.

"I'll tell you what, we're not going to spend capital in any company I'm in - let alone SkyCity - unless we can make a return."

His New Zealand presence, at least initially, was driven by co-incidence. When Telecom took over AAPT, a telecommunications company McGeoch was directing, he got co-opted to his new parent's board.

And at Telecom meetings he spent his time profitably networking: "I sat more often that not next to Patsy Reddy, who was then deputy chair of SkyCity. After about a year she said ‘You wouldn't be interested in joining us? We've got this casino in Adelaide."'

Personal connections, this time with former SkyCity director Rob McLeod, got him appointed to travel firm Gulliver. And his Australasian involvements made him a natural to co-chair the Trans-Tasman Leadership Forum.

His perch gives him an informed perspective as to what makes each country's business culture tick, but he claims there's no difference in the boardroom.

"I wouldn't describe us as different in the way we behave, think or speak," he says.

"We've both got lots to learn from each other, but I wouldn't underestimate the regard Australia has for New Zealand. I don't see in any sense that we're superior, or you're superior, or any difference in personality at all."

But he does see significant difference in the respective nations: "At the mid to high level of business in Australia there is enormous respect for the performance of the New Zealand government. Bill English and John Key today, every time they speak in Australia we're asked: ‘Do they have to go back?"'

Despite his term soon ending on the SkyCity board, McGeoch has strong links with New Zealand and says he will continue to visit the country annually on holiday.

"I love the top-end experience of tourism here. It's seriously superior to Australia. That Kauri Cliff, Cape Kidnappers, Huka Lodge is seriously high-quality stuff," he says.

WHAT HE DOES

Rod McGeoch

Age: 67

Spearheaded successful bid by Sydney for 2000 Olympics

Co-Chairman Australia New Zealand Leadership Forum

Chairman, BGP Holdings, 2009-

Chairman, MediaWorks, 2013-

Director, Ramsey Health Care 1997-

Director, SkyCity 2002-2014

Director, Telecom 2001-2010 

- Sunday Star Times

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