Brisbane Auction: Star Broadcasting ready to win and be on air in 12 weeks!

With just over 24 hours until the auction of a new FM licence in Brisbane, most attention has been on DMG Radio and the Virgin-Macquarie joint venture.

With Brisbane the missing link, DMG is desperate to complete a national Nova network, buoyed by its success at last week’s Sydney auction, while Virgin-Macquarie is equally keen to secure at least one market in its plans for a Australia wide FM network.

Behind the scenes, however, there are six other equally determined, but quieter, lower profile bidders: Star Broadcasting Network; River View Radio; ARN Brisbane; the Gold Coast based Hot Tomato; Brisbane Radio Company; and HR Broadcast Investments.

Despite expectations of aggressive bidding by DMG and Virgin-Macquarie, Star Broadcasting Network Managing Director and CEO, Graham McVean, remains confident of success. He has told radioinfo: “we wouldn’t be in it if we weren’t serious.

“Star Broadcasting was the under bidder at the last Brisbane FM licence auction. Like everyone else, we are playing our cards pretty close to our chest. It makes sense for us – we already have the super regional market adjacent to Brisbane and a strong fortuitous signal into the Brisbane market to build on.”

McVean, who manages 12 stations in Queensland and South Australia, was an observer at the Sydney FM licence auction, wanting to witness proceedings first hand: “we’ve attended many such auctions in the past, so we know what to expect. I went to Sydney to follow the proceedings and congratulate the winner.”

In terms of the main threats/most serious contenders for the Brisbane licence, Graham McVean says: “I think everyone is the room will be deadly serious. We have respect for all of them. This is not a beauty contest – it is a test of financial fortitude and commonsense.”

If successful with its Brisbane bid, he says: “Star Broadcasting has already researched the market and has focus tested a new format. We are confident we’ve identified the holes in the market. We would be on air within 12 weeks!”

In a cautious, final observation, McVean says: “by now, everyone will have evaluated the worth of this licence to their existing or proposed strategy and most, if not all, will have a plan which should not be influenced by the Sydney result. There is no room for emotion on the day of an auction. If there is, people will end up paying way too much for an asset, which really doesn’t fit their business model.”

With projections of $80-$100m for the Brisbane licence, none of the players is commenting on bidding caps or ceilings.

Regardless of the outcome, Graham McVean says: “Star Broadcasting has a strategy for growth, which will see us acquire additional stations as they become available, and if they suit our business plan.

“Our intention is to grow our business by expanding our existing stations and acquiring either new licences, as they are auctioned, or if established stations become available. We have absolute confidence in the continued growth of this sector, and that will give us the confidence to invest further as the opportunities arise.”

Late tomorrow, all eyes will be on the Raffles Room, Stamford Plaza (cnr Edward and Margaret Sts). All applicants must check in from 1.30-2.15pm, with the auction expected to start at 2.30. As with Sydney, the reserve price is $1m.