2016 Australian regional television realignment

Under Australian law, commercial free-to-air television broadcasters are subject to an ownership cap known as the "reach rule", dictating that a single broadcaster's stations may not serve more than 75% of the population. As a result, the major Australian television networks only have owned-and-operated stations in the major metropolitan centres of the country, and rely on affiliates to distribute their programming in the "regional" areas of Australia.[1][2][3]

Nine Network's affiliate in regional Queensland, Victoria, and Southern New South Wales was WIN Television; WIN's owner Bruce Gordon is a 14.99% shareholder in Nine's parent company Nine Entertainment Co. In December 2015, following alleged disputes over fees paid to the network for regional rights to its programming, Nine and WIN had agreed to a "last-minute" extension of their current affiliation through June 2016. Deutsche Bank reported that WIN Television was now required to pay 45% of revenue from Nine programming to the network, although these numbers were disputed.[4][5][6]

In February 2016, Nine Network launched 9Now, an online service offering video-on-demand access to its programmes, as well as live streaming of the network's schedule.[5][1] Following the launch of 9Now, WIN Television sued Nine Entertainment Co., alleging that the company had breached its affiliation agreement by broadcasting into regional areas via the 9Now service.[6] Justice Hammerschlag of the NSW Supreme Court dismissed the case on 28 April 2016, ruling that the affiliation agreement's definition of "broadcasting" only applied to transmission via terrestrial, free-to-air television, and did not cover other means of transmission, such as over the internet.[7][8]

On 29 April 2016, Nine Network announced that it had reached a new, five-year affiliation deal with Southern Cross Austereo, which would see its previously Network Ten-affiliated Southern Cross Ten stations switch to Nine Network effective 1 July 2016, replacing the WIN stations. The deal also called for Southern Cross to provide national advertising sales services for Nine's O&Os NTD and NBN.[5] Under the $500 million deal, Southern Cross pays half of its local revenue from Nine Network programming to the network.[5]

Southern Cross's switch led to reports that Network Ten was already in negotiations with WIN to replace Nine on its stations; Bruce Gordon is also a 14.99% shareholder in Ten Network Holdings, and WIN ran Ten affiliates as joint ventures with Prime Media Group (Mildura, Western Australia), and Southern Cross (Tasmania) alongside its own Nine Network affiliates. The Sydney Morning Herald reported via sources that WIN could achieve a more favourable revenue sharing deal with Ten due to the large number of Ten-affiliated stations it would own if it affiliated.[5][4] Although the network has historically struggled in comparison to its competitors, Ten's ratings had recently seen improvements due to recent successes such as Big Bash League cricket, I'm a Celebrity...Get Me Out of Here!, and MasterChef Australia.[9] On 23 May 2016, Network Ten officially announced that it had reached a five-year affiliation deal with WIN, also beginning on 1 July 2016.[9]