Media ownership law changes finally approach finish line

The Australian Financial Review | Laura Tingle | 15 February 2016

 

Communications Minister Mitch Fifield is close to achieving a breakthrough with the Nationals on local content in regional television that relies on a 'points system' to guarantee production of authentic local stories, paving the way for long delayed changes to media ownership rules.

After tortuously slow progress, the increasing likelihood of a deal on local content means there are growing expectations within both political and media circles that both the so-called reach rule and the two-out-of-three rule will now be dropped when Cabinet considers the issue within weeks.

The reach rule limits ownership of media to 75 per cent of the available audience. The two-out-of-three rule means media proprietors can own two out of three of newspapers, television and radio in a single market. However, the rule doesn't cover pay television or the internet.


Removing both laws would free up television and print media companies to restructure and cross-invest in different markets, opening the way for a major realignment of Australia's media industry.

In their time, both policies were seen as a protection for regional media services, though they were designed to constrain big media proprietors in television and print media from further consolidating their hold on national media markets.

The Nationals have, as a result, resisted changes to the policies in the past.

Points system

But there has been a growing recognition that the dynamics of the media market mean neither rule is viable in the future and, as a result, negotiations within the federal government have led to a proposal that regional television outlets meet a points system for local content to ensure regional news services maintain a real presence in the bush.

Until now, the Nationals – rather than other parties in Parliament – have been the main impediment to a change in the reach rule.

There is a broad perception that – while Labor remains hostile to a change in the two-out-of-three rule – there is a consensus that the change, if introduced, would go to a Senate committee rather than be blocked, leaving the way open for its eventual passage.

While the positioning and lobbying of the various media proprietors – who have strikingly different positions on almost every aspect of media policy – is intense, the first step towards getting an outcome rests with pacifying the Nationals by protecting regional news coverage.

Two-out-of-three can't continue

There has been a significant shift in this area in recent weeks by both regional television operators and Nationals MPs, who were previously arguing for the retention of the two-out-of-three rule to protect local content.

A number of sources say there has been a realisation the rule cannot continue because it prevents much needed investment in regional networks.

The proposed content points system would see regional television operators required to produce 900 points of local content every six weeks, equating ato about 30 minutes a day.

Because of concerns that regional television already centralises supposed "regional" coverage in one centre, and provides so-called rip and read coverage of press releases, there would be different points weightings for different forms of news, with locally produced television vision gaining three points compared to one point for reading out a rip and read press release.

Sticking point

The main sticking point between Mr Fifield and the Nationals is believed to be how this system would come in.

Queensland MP Keith Pitt, who was promoted to the Turnbull government's frontbench on the weekend, has been chairing the Nationals Working Group on media reform since last October.
He told The Australian Financial Review that the Nationals working group want to see the local content points system introduced as part of the media laws, while regional television operators hope it can be put in place on a "trigger" basis – that is, if there is an actual ownership change which would only affect incoming owners.

At Senate estimates committee hearings last week, Nationals Senator Bridget McKenzie quizzed officials of the Australian Communications and Media Authority about a possible change in licence requirements from requiring "material of local significance" to "locally produced content".

Senator McKenzie quizzed ACMA about the extent of rip and read broadcasts that were filling local content provisions.