Cross media ownership laws to meet the reality at last

The Australian | Mark Day | 2 November 2015

Most of us have no difficulty in understanding the media world has changed in the past quarter century. At last, the Australian government appears to have got the message.

At the risk of repeating myself ad nauseam, laws governing what the media sector can and cannot do are hopelessly out of date. The current laws came into ­effect in 1992 after long debates in the late 80s. As some of us — but not successive governments — might have noticed, we have ­since developed a digital world based on the internet. Everything has changed except the law.

The Howard government tink­ered at the edges of ownership rules in 2006, but the Rudd and Gillard governments were unable to come to grips with the need for change. The Abbott government refused to engage with the issue, effectively renouncing the notion of leadership.

Now the Turnbull government has signalled it is preparing to move. Hoo-bloody-ray. About bloody time. The Communications Minister, Mitch Fifield, said last week that changes were proposed in two vital areas — the reach rule that limits any television network to 75 per cent of the Australian population and the ownership rule that limits any individual or corporation to owning two out of the three nominated platforms in any market.

Fifield was cautious in not putting forward a timeframe. It should be simple: the parliament should have no hesitation passing these changes, ­immediately, but Fifield wants to ensure support from Labor and the crossbenches before presenting the legislation.

If he gets that support, bills should be presented early next year. Labor has no objections to changing the reach rule — it tried to do it while in office — but there might be a need to convince some MPs and crossbench senators.

If he cannot get support for an early change, we may have to wait until after the next election.

If that is the case, the Turnbull government should go to the polls with a clear media policy that ­embraces further modernisation — including the relaxation of the antisiphoning laws that continue to hobble the pay-TV industry.

The antisiphoning provisions give free-to-air networks a free kick by ensuring they have first dibs on sporting rights. They prevent pay-TV operators bidding for sports unless the FTA networks have rejected them.

This has always been bad policy. It penalised a new industry to support an old one on the spurious grounds the public should not have to pay to watch iconic events such as the Melbourne Cup or the footy grand finals, plus 1000-odd others. If that were the only reason, it would be simple to mandate that FTA must carry these events, no matter who owns the rights.

The logic behind the need for change is plain to see. Since the turn of the century, digital tech­nologies have allowed us to do more with delivery systems. The spectrum required to broadcast analog television can be used for five digital channels.

With more capacity, we now have more services. With more services, old mass markets are shattering into masses of smaller markets. From the advertisers’ perspective, this makes eyeballs harder to find. Where once you could buy a campaign on a TV network and expect to reach your target market through that single buy, now marketers have to accumulate their target numbers through multiple buys.

From the owners’ perspective, where once it was possible to have a handsome business by publishing newspapers, broadcasting radio or broadcasting free-to-air TV, these days you need a finger in every pie to reach audiences.

Audience habits are shifting fast. Younger viewers are deserting FTA television in droves and finding their own programming via the internet.

Figures last week show viewing among 18-39-year-olds fell from 21 per cent of the total audience to 15 per cent between 2006 and this year. And the rate of desertion of conventional viewing is ­accelerating.

Because of this, networks are starting to stream their programs on the internet simultaneously with their broadcasts. They are also providing catch-up services, so that you should never miss a program you want to see.

This renders the reach rule of 75 per cent utterly redundant. The potential audience reach of a live internet stream is anyone in the entire world with a computer, a smart TV, a smartphone or a tablet.

The irony is that no laws limit streaming. Anyone can do it. You don’t need a costly licence from the government, as do TV stations.

But you get no protection, ­either: it’s open slather on the net and only the strong will survive.

When the reach rule goes, we can expect consolidation in the TV industry. The capital city networks will take over their regional affiliates, although not necessarily according to current alignments.

The networks are preparing to negotiate new affiliation agreements and they want a greater slice of the regional advertising pie. When the reach rule goes, they will be free to take all the revenue.

The Nine Network is still in merger/takeover talks with Southern Cross Austereo, which owns a major radio network along with a swag of Ten-aligned reg­ional stations.

WIN TV owner Bruce Gordon, who owns 15 per cent of Ten while being aligned with Nine for reg­ional programming, recently moved to take 15 per cent of Nine as a hedge against it switching its affiliations. The cross-ownership rule no longer has any worth. Once, it was decreed separation of ownership led to diversity — but diversity of ownership has no impact on viewing. Diversity of opinion is everywhere as a result of the explosion in the number of outlets available, and that is not challenged or ­affected by ownership.

Newspaper websites carry video just the same as TV sites. There is no place for artificial ­constraints on the development of ­information or entertainment services and there is no place for rules that discriminate between distribution via the internet and distribution via the airwaves.

Who knows the difference? Who cares?


View the article on The Australian.