Uncertainty hurts as media braces for tariff impact
(Midjourney)
The presumption was that Trump would be great for business. Not even three months into the Trump presidency, that belief is being pretty thoroughly tested.
Since the introduction of his tariffs last Wednesday, the S&P 500 plummeted nearly 11% – wiping $5.2 trillion off the stock index. For media, it’s not only tariffs but also changes in the regulatory environment that are having a detrimental impact.
(Midjourney)
It’s difficult watching this from Australia, where we have little power but will feel the shockwaves.
There had been an optimism felt by those in the media industry that they could finally move forward with M&A activity that they had kept on the back-burner as they waited out Biden’s chair of the Federal Trade Commission, Lina Kahn.
Back in November, Warner Bros Discovery chief David Zaslav told investors during a quarterly earnings call that the win for Trump “may offer a pace of change and an opportunity for consolidation that may be quite different, that would provide a real positive and accelerated impact on this industry that’s needed.”
Instead, media companies have been reticent to move, worried that personal lawsuits by Trump against media companies and DEI policies would prevent deals from being signed off on.
Yesterday, the proposed Paramount Global and Skydance Media merger was delayed for another 90 days, with the companies still waiting on regulatory approval for the $28 billion deal to close.
Despite Larry Ellison, the father of Skydance CEO David Ellison, being a friend and supporter of Trump’s, the deal has been stalled. The reason: Look to a yet-to-be-resolved lawsuit Trump filed against Paramount broadcast network CBS over a 60 Minutes interview with Kamala Harris that he claims was promoted in a way that was harmful to his campaign.
The new Republican FCC Chairman Brendan Carr has openly said that the 60 Minutes lawsuit would likely be a factor during the FCC review.
Staff at the Paramount-owned Ten Network here in Australia are waiting to see how this resolves. What a Skydance-led company has planned for its international holdings is yet to be seen, although there are indications Skydance has an interest in focusing on core assets. This could mean a sale of international networks like Ten.
The tariffs are already having an impact on local publishers.
Alan Kirk is the Managing Director of The Magazine Publishing Company (TMPC), a Brisbane-based publisher of monthly, bi-monthly and quarterly trade publications and printer of custom publications.
The tariffs have him concerned. The big cost for magazines is the paper they are printed on, but he isn’t worried about that for the moment. Paper stock, which Kirk says is sourced from Japan, is often secured months in advance. The impact of tariffs won’t be felt there for a while. Advertising is his main concern.
Kirk says that they often feel some reluctance from advertisers around the time of a federal election as clients are waiting to see how things shake out, but the Trump tariffs have made international advertisers skittish.
“We have an energy utility magazine that attracts a lot of international advertisers – we’ve been told by clients that they have too much of their business in the US and they don’t know what’s happening. We’re trying to reinforce with those clients that if they lose the US market, they will need to secure other markets.”
Trump’s tariff policies are part of an America-first attitude being taken by the new government. So far we haven’t seen any tariff increases placed on Australia to try and leverage the federal government into dropping the News Bargaining Incentive, which is there to support Australian media with funding by US social media giants.
Similarly, Labor is holding firm on plans to support local content quotas for streaming services in Australia with Prime Minister Albanese declaring that: “We strongly support local content in streaming services so Australian stories stay on Australian screens.”
It followed the release of the US Foreign Trade Barriers 2025 report highlighting the cultural policy. The concern is that it violates the free trade agreement Australia signed with the US.
Again, there hasn’t been any move to increase the Australian tariff as Trump has done today with a 104 per cent tariff slapped on China, but all it can take is just one person having Trump’s ear for a moment.
