The deal, which is subject to regulatory approvals, could save the network from a difficult patch. Network Ten has been in voluntary administration since June after key investors withdrew financial support following a drop in ad sales and continued losses.
CBS could use its newfound presence in Australia to test its Netflix rival CBS All Access overseas. An expansion to Canada was announced earlier this month, and reports suggest Australia is among the other planned forays. Initial content available in Australia may be more limited than in the U.S., however, since other broadcasters own local licenses for certain shows.
Originally it appeared that Network Ten would be acquired with a joint bid from existing backers Bruce Gordon and Lachlan Murdoch — son of Rupert Murdoch. But, despite an apparent green light from administrators, CBS stole in.
One key reason is Australia’s “reach rule,” which places limitations on media ownership. Other assets owned by Gordon and Murdoch would have meant a deal for Network Ten breached regulations. The Australian government is pursuing reforms which could have allowed the deal, but the bill is currently stalled in parliament and it looks like Network Ten could not afford to wait it out.