FOXTEL AFR 060303 PHOTO BY ROB HOMER --- a bank of monitors at the  control centre at foxtel   AFR FIRST USE ONLY SPECIALX 47927

Pay TV may be at the center of a new repositioning of media power in Australia. Photo: Rob Homer

THE competition regulator's decision to block the tilt by Kerry Stokes's Seven Group Holding for James Packer's Consolidated Media tells us several things that point towards yet another round of repositioning of media power in Australia.

At first blush, Stokes's near two-decade battle for a foot in the pay television industry appears over. Having spent millions in court fighting over the remnants of the failed C7 venture, Stokes won a seat at the table with a daring raid on Packer's ConsMedia.

While many thought the logical outcome was that the pair would eventually take ConsMedia private, Stokes may not have counted on Packer's willingness to sell.

Nor Rupert Murdoch's willingness to pay up.

With the ACCC blocking a Stokes counter bid, his pay TV mission appears over.

But in accepting News's offer, Stokes will now have an ample war chest of about $500 million with which to consider buying more media assets or more earth-moving assets.

Media assets are historically cheap but many remain deeply structurally challenged.

However, media investments have been fickle friends in recent years. Packer, Murdoch jnr and Gina Rinehart have all taken a bath on Ten Network while Stokes has seen the value of his media assets fall too.

Stokes may now choose to concentrate on free-to-air. Indeed, some suggest that Seven management has already made a clear choice of Australian free-to-air over pay.

Stokes also has the advantage of diversity with mining services investments via WesTrac. The China investment boom may be peaking but is by no means over. Seven's diversity of assets allows Stokes to deploy the cash where he best sees fit.

For his part, Murdoch's News Corp is undisputed gorilla in the room in pay television in this country alongside News's 70-odd per cent control of Australian newspaper assets. Telstra has 50 per cent of Foxtel.

Telstra is the unknown in the equation. While it has a 50 per cent stake in Foxtel, News will control the sports rights. Telstra's media intentions remain unclear. Does it want content to support its sliding Sensis directories business?

For his part, Packer has been freed up to deploy his spare cash towards his gaming assets.

The sale of ConsMedia, essentially a holding company for the Foxtel stake and the sports rights assets, spells the end of Packer's media interests for now - aside from a small stake in Ten, a particularly poor investment for Packer.

Packer has been ahead of the game divesting media assets over the past five years, selling television and magazine assets at the top of the market and correctly spotting the fracturing of the audience would make life tough for incumbent media organisations. His error appears to have been investing it in gaming assets soon after and losing plenty as the financial crisis took hold.

As the dust settles on the latest shake-up, Packer is as good as out of media and cashed up, Stokes is sitting on his hands and cashed up, and News is restructuring to ride it out.

The biggest names in Australian media are nimble and waiting for signs of a moment to strike.