THE embattled Ten Network now has one of its most successful investors questioning whether there is room in the market for the No.3 commercial television network.
Businessman Laurence Freedman, who made his fortune as one of the investors who plucked Ten from receivership in the 1990s and relaunched it as the most profitable free-to-air network in Australia, tweeted this week that Ten ''have lost the plot'' after newsroom staff were recently included in its cost-cutting efforts.
Mr Freedman said he has believed for some time that one of Australia's three commercial free-to-air channels would not survive.
Up until now, the only question was which two would make it, he said.
''I don't know what the solution is,'' Mr Freedman said.
Ten did not respond to Mr Freedman's comments but company chairman Lachlan Murdoch did acknowledge the company's bad year in the annual report that was released on Tuesday.
He promised things are improving.
''The company acknowledges our ratings and revenue in 2012 were not what we expected and that our programming schedule on the primary Ten channel did not perform as hoped,'' Mr Murdoch said.
''At any time this is unacceptable, let alone in a weakened advertising market.
''There is no question that Ten Network Holdings enters 2013 as a different company than it was just 12 short months ago.''
Steve Allen, chief executive of media consultant Fusion Strategy, said Ten's performance had been an ''unmitigated disaster'' and said its survival was not guaranteed by any means but there was room for a good No.3 player.
''It's the worst time to be a bad No. 3,'' he said. Ten shares are now trading for less than a 10th of the price at which Mr Freedman sold out in 2004.
He described the epiphany he had when buying a mobile phone that year with ''back channel'' - referring to a mobile user's ability to communicate back over the network in the same manner as a desktop computer over the internet.
It is a feature TV networks are still struggling with - connecting advertisers and its mass audience directly.
''That was the beginning of the end to me. What I was doing was buying the future and holding on to the past,'' he said with reference to the mobile phone purchase and his shareholding in Ten at the time.
It had been a golden run since Mr Freedman and a group of businessmen, which included CanWest boss Izzy Asper and ad man John Singleton, acquired the network from Westpac in 1992 and aimed it at the lucrative 18-year-old to 39-year-old age group with cheap programming.
It is a run he is not expecting to be repeated by the current crop of billionaire shareholders such as James Packer, Lachlan Murdoch and Gina Rinehart, who have made huge losses on their collective investment.
''They were, I think, tempted by the fact it [the share price] had fallen so much,'' he said.
There was a reason for this fall.
Ten's core 18-year-old to 39-year-old audience was leaking to rival network multi-channels and to the internet.
Ten then made an expensive bet it could expand its audience with more costly programming.
The strategy did not work and it was left with a more costly business model and third place just as the media advertising contracted.