Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Legal and Constitutional Affairs Legislation Committee - 28/07/2014 - Classification (Publications, Films and Computer Games) Amendment (Classification Tools and Other Measures) Bill 2014

BUSH, Mr Simon, Chief Executive, Australian Home Entertainment Distributors Association

CAVALERI, Mr Joshua, Legal and Policy Counsel, Interactive Games and Entertainment Association

CURRY, Mr Ronald Alexander, Chief Executive Officer, Interactive Games and Entertainment Association

FLEKSER, Ms Lori, General Manager, Motion Picture Distributors Association of Australia

WOOLDRIDGE, Mr Marc, Chairman, Motion Picture Distributors Association of Australia

Committee met at 11:20.

CHAIR ( Senator Ian Macdonald ): I declare open this public hearing of the Senate Legal and Constitutional Affairs committee for its inquiry into the Classification (Publication, Films and Computer Games) Amendment (Classification Tools and Other Measures) Bill 2014. The committee's proceedings today will follow the program circulated. They are public proceedings broadcast live via the web. The committee may agree to a request to have evidence heard in camera or it may determine that evidence should be heard in camera. These are standard things we read out every time, so I am not suggesting for a moment that you would need parliamentary privilege, but I do remind all witnesses that giving evidence to the committee is protected by parliamentary privilege. It is unlawful for anyone to threaten or disadvantage a witness on account of evidence given to a committee, and such action may be treated by the Senate as a contempt. It is also a contempt to give false or misleading evidence to the committee.

The committee prefers to have evidence given in public, but if for any reason you want things to be heard in private, please let us know and we can consider that at the time. If you should object to answering any question, you should state the grounds on which the objection is taken and the committee will consider that. When you are called upon to answer a question for the first time, could you state your full name and the capacity in which you appear for Hansard, and please speak clearly into the microphones. At the end of your evidence, I ask you to stay around for a couple of seconds in case Hansard need to clarify any names or dates with you.

One of the reasons we should not have started early, I have just realised, is that one of our colleagues, Senator Ludlam, who is experienced in these sorts of things—and we are all experienced in these sorts of things, but Senator Ludlam is perhaps better the age to talk about some of these things—was not here. I am sorry, Senator Ludlam, we thought with everyone being ready we might start a bit early. I had overlooked the fact that you were not here, and we do need you for this inquiry.

Senator LUDLAM: That is fine, Chair.

CHAIR: Gentlemen or Ms Flekser, do any of you or all of you have an opening statement? We have before us the Australian Home Entertainment Distributors Association, the Motion Picture Distributors Association of Australia, the Interactive Games & Entertainment Association and the Games Developers Association of Australia—I would like to see the acronym for that one. Do any of you have an opening statement?

Mr Bush : Yes. AHEDA supports the national classification scheme and supports this bill. The scheme is material to AHEDA members. In 2012-13, of the 4,487 decisions made, 66.5 per cent relate to AHEDA members. Of total revenue from application fees of $5.33 million, film-other accounted for $4.38 million. Despite supporting the scheme and its principles that classification markings provide useful information and guidance for parents and children, we also support ongoing reform.

The classification act is an analogue scheme in a digital age. The Senate Legal and Constitutional Affairs References Committee put it well in June 2011 in its report on the scheme on page 168, where it said:

The scheme has failed to adequately keep pace with the advent of new technology, meaning that ambiguity now exists as to which regulatory regime applies to some content.

Significantly, one of the shortcomings of the scheme is that it is not platform neutral. That is, it does not provide for a consistent classification decision-making framework in a converged media environment.

I believe the guiding principle to reform should be same content, same rating, single system and different platform. It is crazy that some content is classified multiple times. Members should also be aware that in recent research I undertook, of the first 50 new-release titles I looked at in the iTunes Store independent category, 30 were not rated—in other words, 60 per cent. Of that small snapshot of 50—the first 50 I came across—30 were not rated.

Senator MARSHALL: Are these games?

Mr Bush : These are films. We represent home entertainment, which is everything post theatrical window for films—so DVD and digital. Further, AHEDA also recently announced that the traditional window system of film releases has changed, with their 120-day window from theatrical to home entertainment reduced. There are also cases of digital release at the same time as theatrical, or even beforehand, and this trend will accelerate. AHEDA members will be generating close to $200 million in digital sales by the end of this year, with massive growth predicted beyond. It is believed that over 200,000 Australians are using VPNs to access overseas subscription movie services such as Netflix. The world is changing and we cannot sit still.

Historically, classification reform in Australia has been difficult to achieve, and the existing system is unfortunately failing to adapt to new business models. AHEDA recognises that the bill proposes first tranche reforms, and as such we commend this bill and the parliament on taking these positive first steps. Thank you.

CHAIR: Thank you very much, Mr Bush. Is there anyone else? Mr Wooldridge.

Mr Wooldridge : The Motion Picture Distributors Association of Australia represents six major Hollywood distributors who make up approximately 75-80 per cent of the market. First of all, on behalf of the MPDAA, let me express our full and unanimous support for the amendment that removes the need for 2-D and 3-D content to be classified separately for public exhibition. The MPDAA has been lobbying the classification board for change on this issue for over five years, and as such very much welcomes it. Given that there has not been an incident of an MPDAA released movie being launched simultaneously in 2-D and 3-D and receiving a different rating or different consumer advice, this process would appear to have placed an unnecessary cost on distribution companies for many years, in addition to administrational burden on both distribution companies and the classification operations board.

Regarding schedule 5 of the bill, our comments and opinions on any changes to the high-level principles relating to classification markings beyond the mandatory inclusion of consumer advice on all G-rated movies can only be truly formed once we have greater visibility to what is currently being considered. In relation to the mandatory inclusion of consumer advice for all G-rated movies, the MPDAA would like to put forward some considerations, and Lori and myself would be happy to answer any questions the committee might have this afternoon or this morning.

The MPDAA is committed to providing relevant, useful and clear guidance to consumers in the area of classification, and the industry body has an excellent reputation and track record of compliance, as reflected in the limited number of consumer complaints—which numbered hundreds per year—compared to the total cinema-going audience, which averages over 70 million per annum. We are particularly aware and supportive of the role classification plays, as it relates to what content is suitable for families and young children. However, while we remain open to enhancing this service to the public, any change to a well-established and well-understood classification system must be reviewed in the context of whether change will truly add value or will potentially create confusion.

By way of reminder and clarification, the G rating is given to content suitable for a general audience—that is, for all ages—and this has been communicated to consumers for many years. Where the Classification Board has felt it to be necessary, they have the ability currently to provide additional consumer advice for G-rated films in the rare instance when it is deemed useful to consumers. The process seems to be working very well currently.

Based on the information we have from the Classification Board's annual reports of 2009-10, 2010-11 and 2011-12, in this three-year period there were only three G-rated movies cited in the reports that received any form of consumer complaint about the final classification decision. Of those three movies the level of complaint received per movie was very, very limited. For example, in the 2011-12 annual report there were only four complaints about the movie Toy Story 3 compared to the 4.6 million people that went to see that movie in cinemas. I think it is relevant to point out that Toy Story 3 was released in cinemas with the additional consumer advice of 'some scary scenes'. However, based on the report, the complaints from consumers were based on the view that the film should have received a higher rating, presumably PG. The other two movies were The Princess and the Frog released in cinemas with no consumer advice and The Pirates! Band Of Misfits with the consumer advice of 'very mild comedic violence and coarse language'. The two movies received only 18 and three complaints respectively.

In summary, across all three films that appeared in the most recent annual report, the Classification Board received only 25 complaints from the public compared with the combined 5.54 million people who are estimated to have seen the three movies at the cinema. Two out of the three movies were released with consumer advice. While not definitive, in that it only takes into account people that registered a complaint with the Classification Board, we believe that this information provide some very important context and strongly suggest that the current process around the classification of G-rated movies is working well for the general public, the Classification Board, and the cinema industry as a whole from both an administration and compliance perspective.

On the subject of consumer advice, the language currently used in conjunction with the ratings decision is limited to just a few words. It is extremely broad and often open to interpretation and the personal tolerance levels of the decision-maker. For example, what parents are comfortable allowing their family to see can vary from parent to parent and from child to child. As such, we would appreciate the committee's full consideration regarding the potential confusion among the general public and, in particular, parents by adding consumer advice to all G-rated movies. For example, for a PG-rated movie the word 'mild' is often included in consumer advice to soften the description of the content such as 'mild scary scenes'. For a G-rated movie would the consumer advice include 'very mild' to help distinguish it from the PG rating? If so, would that information be useful enough or clear enough for the parent of a preschool child to make an informed decision? Could it potentially put them off watching the movie because they do not fully understand the context of 'very mild' versus 'mild', and potentially take an unnecessarily conservative position on whether the movie is suitable? The point we would like to make here is that there is a real nuance and limitation around the language used for consumer advice that should be well considered and discussed in order to evaluate the need and value for the mandatory addition of consumer advice for all G-rated films.

Finally, we would like to remind everyone that the cinema is the most controlled and regulated environment for general public consumption of filmed entertainment and promotional content in Australia, certainly compared with the internet and broadcast television. The MPDAA, in conjunction with the cinema operators, both play a role in ensuring the first-class reputation for compliance in Australia. The MPDAA also enjoys a very good working relationship and ongoing dialogue with the Classification Board. In general the current process works very well, however, the opportunities to influence minor but important changes within the classification system, beyond what is being discussed today, are extremely challenged and move at a very slow pace. There are aspects of the current legislation that, frankly, do not reflect what is happening in other relevant jurisdictions or in other mediums and is out of step with the digital age. For example, one simple and minor change in legislation like the need for 2-D and 3-D content to be classified separately has taken over five years to get to the stage we find ourselves in today.

On behalf of the members of the MPDAA we would welcome the opportunity to represent and seek resolution to other key industry issues on the subject of classification in a more reasonable time frame going forward. Thank you to your attention.

CHAIR: Thank you very much. Mr Curry.

Mr Curry : For clarity, our submission was a combined submission with the Game Developers' Association who are not present today.

CHAIR: So, you are not one group?

Mr Curry : No, Senator, we are two separate groups.

CHAIR: You do not have a combined acronym, then.

Mr Curry : No, definitely not. The videogame industry has strongly supported the principles that underpin the National Classification Scheme, particularly that minors should be protected from materials likely to harm and disturb, and balancing that against adults being able to read, hear, see and play what they want. Even if regulation did not mandate classification of games and the display of markings, the video games industry would continue to support the objectives of the scheme by voluntarily classifying and marking games. This is evidenced by the industry's conduct in many other territories where games are classified voluntarily through self-regulatory models.

As an industry seeking the empowerment of self-regulation, the obvious question to us is: how can your industry be trusted to classify their own content? And it is a reasonable question. Our answer to this is that there are no winners for not classifying correctly or for not classifying at all. As the game market matures, developers are creating games that explore mature themes and mature narratives. By using restricted classification, developers are able to make perfectly clear that such games are only appropriate for a mature audience. If we fail to do this we will lose the trust and confidence of the public, which is an outcome that would be detrimental to the growth of the industry.

Just by way of context around the industry and its size and scope, in 2013, Australia's video game and computer game industry recorded sales of over $2 billion. This comprised of around $1.1 billion of traditional sales through retail outlets with about $900 million in digital sales downloaded from the internet in some way. The digital sales market grew 50 per cent from the year before, from 2012, and Telside, one of the researchers in Australia, is projecting that that will grow by another 50 per cent in the coming year.

According to the Australian Classification Board's database there have been approximately 14,000 decisions made for computer games since 1994. However, last year alone, there were 75,000 games submitted to the Apple Store. In other words, in one year alone, the Apple Store has produced five times as many games as the Classification Board has classified in 20 years. If we look at the average time it takes to classify a game, we would assume it would take the board around another 100 years to classify last year's releases from the Apple Store.

Our view of how classification should be addressed in the digital world is fairly simple and is largely consistent with the ALRC's recommendations. The current scheme should be replaced by a co-regulatory, industry-led scheme that is overseen by a Commonwealth regulator. Authorised industry assessors and classification tools should be used to classify games. The Classification Board should be responsible for auditing and monitoring assessors and classification tool decisions and, where necessary, review decisions brought to the Classification Board's attention by either the government regulator or the public. The bill we are discussing today is largely consistent with our vision for Australia's new classification scheme, and we look forward to further amendments that reflect the board recommendations of the ALRC.

I would like to finish off with a final point addressing some recommendations that have come from some other parts of the inquiry. There have been several submissions suggesting that the bill should be only allowed to classify unrestricted content such as G, PG and M. The ALRC addresses this with two points and gives some alternatives. It states that, at 711(6), the act might prescribe the content that may be classified by these instruments. For example, it might prescribe that they only be used for content that is voluntarily classified, such as G, PG and M. An alternative they gave at 711A was that the act could enable the regulator to determine what content may be classified using an authorised instrument. It appears that, with this bill at least, they have adopted the alternative recommendation, or the latter recommendation, from the ALRC.

We believe the classification tool must be able to classify the total spectrum of the game content which includes MA, R18 and RC for three important reasons, which are volume, engagement and for purpose. On volume, if we look at the ratio of restricted games classified last year by the Classification Board, it was around 17 per cent. We estimate that there have been about 12,000 restricted games released on the App Store last year. This is almost 19 times the number of games classified by the board in the same period. If classification tools cannot be used for restricted content, we doubt whether the board would be able to classify this massive amount of content by themselves. As far as engagement, if we look at a classification tool that can only classify part of the range of classification determinations, it is unlikely it will be fit for the purpose. Therefore, it is unlikely to be adopted by stakeholders, and we end up in the situation we are in today where nobody is using the scheme to classify a digital product.

One of the overarching purposes of the scheme is to protect children from harmful material. Limiting the use of a classification tool to only unrestricted content will not prevent that content from being accessible. Rather, it will ensure that such content continues to be made available without the safety net of having appropriate advice of the content's age appropriateness. Allowing classification tools to classify all content, including restricted content, will increase the likelihood of such content being classified to Australian standards and therefore improve the protections available to children. Thank you.

Senator REYNOLDS: Thank you very much for your submissions. There are a couple of areas I would like to pursue. First of all, Mr Bush, you talked about analogue in a digital age, and that it was not platform neutral. I am just wondering whether you or any of the others want to provide a bit more information for us: if it is not platform neutral, how do we make it platform neutral? What are your thoughts on that?

Mr Bush : A really good example of that is when something comes out theatrically and then goes onto DVD. If there are any changes it has to be reclassified. But perhaps a more relevant one is that if a TV series is shown—whether it be on subscription TV, which has its own code, or free TV, which has another code, which is industry self-assessed—that could be running for 20 years. It could be Little House on the Prairie, but if you put it out on DVD you then have to reclassify it at great expense—thousands and thousands of dollars. And it will carry the same rating, but you still have to go through the process, because that is what the law suggests. In other words, when TV content, first shown on TV, comes out on DVD in boxed sets, which is incredibly popular in Australia, you have to get it reclassified. So, why can't we carry the TV rating across to DVD? The ALRC agreed with that proposal and suggested that that makes complete sense and that we should do that.

Senator REYNOLDS: Is that because there are different codes and also different rating systems—if you have different classifications for ratings, what might be PG in one is a different rating in a different system?

Mr Bush : There are some subtle changes and differences. There is supposed to be alignment of the National Classification Scheme across the different codes. There are some subtle differences. For example, in TV land you can have AV, which I believe stands for Adult Violence, but no such rating exists under the scheme. The equivalent would be Mature Accompanied in the classification act. With my limited understanding, regarding the question on free TV, perhaps the answer is that Mature Accompanied in the context of the home under a broadcast is a bit difficult, so I think they change it for that reason. Having said that, there is a direct correlation in most cases between the codes of free TV and subscription across to what we are covered by. So, I would say that most of it is the same, and there is supposed to be a correlation. But I am sure you could create a scheme that would deal with those anomalies where they arise.

Mr Wooldridge : I generally agree with that position. We are the first port of classification. We start the process off for all feature films. One issue—although not so much in terms of the feature film content—that continues to be challenging for us is the issue around the promotion of our content as it relates to content that is able to be shown in a cinema compared with what is shown on broadcast television. There are two different codes or two different sets of regulation as to what can be shown to consumers in a theatre. That is based on the expected rating of the final feature, not the content of the trailer itself. However, as it relates to any promotion digitally on the internet, pretty much anything can be shown to anybody. And as it relates to broadcast television, the code there is based on the content and the appropriateness of the audience, based on time zones.

Senator REYNOLDS: So, the trailer you might have on your website or on YouTube, for example, might not be able to be shown, or you would have to go through a separate process to run a TV ad on it.

Mr Wooldridge : Very simply, a film that is expected to have an MA15+ rating is unable to be trailered in theatres on an M-rated product currently, even if the content of that trailer is suitable for an M audience.

Senator REYNOLDS: In your submission you talk about the six classification elements, but then you talk about context and that the new rating system was not able to take context into consideration. Could you provide a bit more information on that?

Mr Wooldridge : Are you referring to consumer advice?

Senator REYNOLDS: Yes, I think so. You were saying that there are six classification elements but that the new tool was not suitable for applying context to content.

Mr Wooldridge : I am not sure that there was anything about the tool in our submission.

Mr Curry : I think that came from the classifiers association's submission—was that it? They were meant to be appearing first.

Senator REYNOLDS: Okay. Do any of you have any comment on that? Is it relevant to any of you at all?

Mr Wooldridge : No, I think our point would be the context around the consumer advice and the fact that it can be three, four or five words to describe the content of the film. And if you do not have an in-depth knowledge of the context, of how that language is appropriated for each rating, it could potentially be misleading, particularly as it relates to the issue in hand, which is the mandatory consumer advice being added to all G-rated movies.

Senator REYNOLDS: In relation to iTunes and other online places where you can download games or movies, what is the situation? For Apple, overseas, for those games you are talking about—the thousands of them that come online every year—do they already have classifications from other countries? We would not see them in Australia. Are they already classified by somebody else?

Mr Curry : Apple has its own classification scheme. The bill that is being introduced specifically had in mind a classification tool called IARC, which is being utilised at the moment. It is a tool that will deliver a classification for various territories. So yes, it will deliver a US classification and it will deliver a classification that covers about 30 European territories, and Brazil, and hopefully Australia. So yes, it will be a single point of input and multiple points of output as far as classification goes.

Mr Bush : I can add to that. I think I mentioned in my opening statement that a number of titles—I have no idea of the scale, but certainly if you look at the first 50 in the independent genre, 60 per cent were not classified—

Senator REYNOLDS: At all? So, it is not just an Australian classification; it was not classified at all?

Mr Bush : There was nothing there at all—absolutely nothing there. Apple, as Mr Curry said, has to enforce and police the classification systems. It is their responsibility as the platform. What they have done in the last few weeks, however, is send communications to distributors saying: 'You must comply with Australian law and New Zealand law. For those that do not have ratings provided to us to put up on our store that comply with the laws in Australia, the content will be removed.' So, there is now a process of those distributors—and it is usually the smaller distributors that have not gone through the process, the smaller films—having to comply and make that rating available, or Apple will, it has said, now remove that content from the Australian iTunes store. So, for a lot of the overseas distributors that are making their content available—the art-house-type product in particular—a lot of that might get removed from the Australian store, which is unfortunate for the Australian consumer. And unfortunately for us in industry they cannot access legal means to access these art-house titles.

Senator MARSHALL: It doesn't just default to the highest rating? It has to be removed altogether?

Mr Bush : It has to be removed, because it is not compliant. You cannot just make up a rating. You have to go through the scheme and the system and apply for a rating and apply it. With a self-assessment system—which we have, in part, for films already under the scheme, and the ALRC has suggested broadening that—you are going to get greater compliance and you are going to get greater choice and availability for Australian consumers. And that is certainly what we strive for as an industry.

Senator REYNOLDS: Does that include TV series as well, or are you just talking about motion pictures?

Mr Bush : I was just looking at films. The question of TV series is interesting. I know there is an example from several years ago where for Law & Order Season 4, I think it was, the local distributor decided not to release it on DVD in Australia, because the cost to classify it was prohibitive. You had to classify based on the per minute running time, so to classify a TV show that runs for 10 episodes and thousands of minutes the cost was several thousand dollars at the time. As a result—

Senator MARSHALL: We were over it by season 4 anyway.

Mr Bush : It was a long time ago, a few years ago. So the distributor said, 'I have to sell a lot of units to get that money back and break even. I'm just not going to make it available.'

Senator MARSHALL: In terms of games, Mr Curry, you indicated that the industry has been self-categorising games anyway.

Mr Curry : In other territories, you mean?

Senator MARSHALL: No, in Australia. I am not an expert on this, but didn't you have a problem where the highest rating you could have was MA?

Mr Curry : MA15+.

Senator MARSHALL: Right, so there was no R rating.

Mr Curry : That is right.

Senator MARSHALL: So that stopped R-rated stuff coming in. Were you not in a position then to simply R-rate your games anyway?

Mr Curry : No, there was no R18 classification for video games. So anything higher than MA15 was refused classification.

Senator MARSHALL: Right. So now that there are more classifications you still go through that same process of self-ratings.

Mr Curry : Exactly the same process, yes.

Senator LUDLAM: I will pick up there, Mr Curry. I am keen for you to tease this out for us, because a lot of people are less familiar with how the system works for gaming content than how it works for TV and films, although I will come to that in a tick. You were talking about tools that could not be used for restricted content, so that is anything above M. Is that right? Could you just tease out for us exactly what you meant by that? I might have missed the beginning of the thread.

Mr Curry : If we are talking about the specific tool that has been developed, and I think the bill is addressing the introduction of that tool, it will deliver a classification right up to RC—refused classification. That is based on the guidelines. There are a number of submissions to the Senate that suggest that the tool should be used only for G to M. I have two concerns. First, as a parent, I am much more interested in what is M and R for my children. So having a scheme that does not deliver all of those either only half solves the problem or does not solve the problem at all. Publishers just will not use it because it does not deliver the full suite of options to classify a product.

Senator LUDLAM: I do not want to draw you too much into paraphrasing other people's submissions, so if you get uncomfortable please stop. But is there a sense that this self-classification system should only be trusted up to certain categories of content and after that some other authority should take over? Is that the general principle?

Mr Curry : That is my reading of it, yes.

Senator LUDLAM: We might have some people with that view a little bit later in the day, so I can take that up with them. But, just to be clear, it is not your view that that is the case. You say the tool should basically be able to take in the whole spectrum?

Mr Curry : That is right. The tool is designed to work in line with the guidelines. So, if we can accept that the guidelines can be trusted for G, PG and M, then by extension they should also be able to be trusted for MA, R and RC.

Senator LUDLAM: I get that. Can you just provide for us—and anybody who wants to can jump in—your understanding of the scope of what is in and what is out? I think it might have been you, Mr Wooldridge, who talked about how your industry is somewhat on the front line and you are subject to the highest degree of scrutiny for theatrical release and it cascades through. So you are in the net, TV content is in the net and gaming content is in the net. What about the hundreds of thousands of minutes of YouTube content that is uploaded every second? I am presuming the scheme is not going to attempt to classify that.

Mr Bush : User generated content is not covered, as far as I am aware.

Senator LUDLAM: It is not covered. Apple, being a walled garden, obviously has its own classification scheme that some of you have name checked already, but what about other mobile phone platforms—apps and that kind of stuff?

Mr Curry : I think it applies the same to all of them.

Senator LUDLAM: As in not at all?

Mr Curry : As in noncompliance.

Mr Bush : They are supposed to comply.

Mr Curry : There is not a high level of compliance, and I guess we could argue a point about whether they believe they should comply or not or whether the law captures them or not.

Senator LUDLAM: To me there is a question of whether they should comply and there is a question of how on earth you could classify that torrent of content even if you wanted to. Do you guys have a view on whether we should be attempting to expand the scope so that anything that a nine-year-old can pick up on a handset can be classified by somebody? Should we be trying to go there or is it just going to be too hard?

Mr Curry : From the games industry perspective I think that is too hard. But we also think that, even if the regulation is not in place, there should be an attempt to at least deliver a tool that, as far as games go, can give some sort of age determination for that product in whatever territory you live in. That is tied to the fact that all of our devices have parental controls on them so they can be set and the parent can have a higher level of trust, I guess, in the ability to filter out product that they choose not to allow their child to have access to.

Senator LUDLAM: The products have to have been prescreened to be flagged by that system.

Mr Curry : That is the other thing: without some sort of tool that enables some consistency in how those determinations are made, it becomes impossible to have the parental control that works effectively.

Mr Bush : From the perspective of film and home entertainments on TV, through digital release or DVD, we support classification on that content. If it has been previously classified we would like to be able to leverage that and reuse that on a different platform, and that makes eminent sense. We would like the ability to expand on the current self-assessment models that exist and be able to reuse those rather than having to go through a very regulatory, fee driven, application process for feature length, major TV series and user generated content. Mr Curry is talking about games, where there are so many, and that is slightly different from what we deal with. There is a lot of stuff out there that is unclassified. The easier you make it the more likely that people will comply.

Senator LUDLAM: It just feels to me like a very different task. Trying to regulate large-scale institutional production of content for mainstream or theatrical release is quite a different order of task from trying to classify every tiny fragment of content that is getting generated.

Mr Bush, I think you said at the outset of your comments that you think this is a pretty decent first tranche. What do you think should be in the second? What haven't we done yet?

Mr Bush : It is a very good question. Ideally, we would have liked the legislation before the committee to adopt the major recommendations. Being a federated model there are obviously some major difficulties in working with states in order to get a lot of this across the line. We are all aware that it is difficult to get this on the agenda at the meetings of the state and territory and Commonwealth attorneys-general, let alone to get them to agree to anything, so the fact that this has been agreed is extremely positive. It is a very positive first step. We would like to see the states and territories agree to wholesale change, as proposed by the ALRC, and basically redraft the classification act and for the Commonwealth to take over a lot of those powers that states currently have.

There is this strange duplication of powers in the states and there are different laws in different states, which makes compliance extremely difficult, particularly in the areas of advertising. We have had South Australia in particular go off on their own and make laws around advertising of R rated content. That makes it difficult for retailers, say, a JB Hi-Fi or a Coles, to put out national catalogues across Australia. They now have to pull the catalogues out of that state and reprint them, or do what they done for R rated films like Mad Max or Blade Runner, which is not to stock those films at all in their stores.

Senator LUDLAM: Blade Runner is R rated?

Mr Bush : Yes, some of those films, like The Godfather, are R rated films. These retailers have decided, as a result of what South Australia has done, not to sell the films at all in that state. That is quite odd when you can get it online.

Senator LUDLAM: That is purely about having to reprint multiple versions of catalogues?

Mr Bush : It is purely as a response to that, correct.

Senator LUDLAM: All right. So it is a pretty useful first step—I think you offered unanimous support, although it sounds somewhat qualified, along those lines. It has not come through very strongly in the submission batches for this piece of legislation but there were concerns at the outset that a more unified or uniform classification scheme nationally could end up providing the foundation for an internet content filter. That would kind of go back a couple of years to when Senator Conroy was communications minister and the attempt to throw a filter over anything that was RC. Do you think those concerns are legitimate? Do you have any lingering concerns about that?

Mr Bush : I do not think the ALRC is proposing an internet filter as per was proposed by Senator Conroy.

Senator LUDLAM: Quite the opposite.

Mr Bush : I do not have to share that concern. It is not something that AHEDA would support, either.

Mr Curry : We are of the same mind.

Senator MARSHALL: Isn't there an inconsistent approach in what you were saying earlier that if something is rated on one platform, then it should have the same rating elsewhere? So if something has restricted content on one platform, what is the problem with saying that it has to have the same rating elsewhere?

Mr Bush : We agree with that but my understanding of what was proposed by Senator Conroy in the filter was to have certain websites that were given to an ISP, say, 'You need to block these.' Is that—

Mr Curry : It was, but I think the question is still germane.

Senator MARSHALL: But in practical terms, how do we implement it? The principle is the same, isn't it?

Mr Bush : My notion of a filter is very prescriptive, it is asking an ISP to block a URL, whereas what I am suggesting is if it has been rated by TV, that is classified. Under the National Classification Scheme why can't we use that on DVD or when it is shown on iTunes store?

Senator MARSHALL: But if it was on TV and it was restricted content—therefore, it probably is not on TV—it should not be available anywhere else, should it?

Mr Bush : It would not be on TV.

Senator MARSHALL: Why should it be available elsewhere?

Mr Bush : I am not sure what you mean by 'restricted content.' If it was refused classification, it should not be broadcast or made available anywhere, including online. I think that is where you are kind of going.

Senator LUDLAM: One of our later witnesses, the ACCM, made the point that they think you can take—I am probably crudely paraphrasing—self-assessment and self-regulation too far. Can you—or whoever wants to take this on—describe for us from your point of view the processes for appeal. If an organisation classifies something with a particular kind of content, just talk us through the steps that are involved to kind of get that ticked off and then what happens if, as a parent, I am exposing my kid to something that I think should have been rated much higher than the industry has assessed it. Do you want to start that one off?

Mr Bush : I will start and then Mr Curry can respond. We got some amendments to the classification act through five or six years ago. There are two schemes that have limited self-assessment by industry-authorised assessors, who are trained by the government and who have approval to assess certain content. They are the authorised television assessor scheme and the Additional Content Assessment Scheme. The amendments are sort of workarounds around TV modification and additional content issues that I talked about earlier. They are pretty ad hoc amendments. They work. They are better than nothing, but we obviously would like to see further changes.

In the 2012-13 annual report, 507 decisions were made under the authorised television assessors scheme. There were 227 decisions made under the Additional Content Assessment Scheme using industry-authorised self-assessors, so my members basically employing people to do this work on behalf of the Classification Board. However, under the act you still have to submit that paperwork and documentation through to the board for final sign-off. But essentially that has now been running for a number of years. Of the thousands of decisions that have been made, I am not aware of one complaint.

Senator LUDLAM: Truly? No-one has ever come at you or any of your members for saying 'That definitely should have been an R rating,' and you—

Mr Bush : Not that I am aware of. I will take it on notice and if there are—

Senator LUDLAM: Close to zero, if not actually zero?

Mr Bush : I will take that on notice, but that is my understanding.

Senator LUDLAM: Does that go for the games industry as well, because you have had a rather rough ride through this?

Mr Curry : Can I just clarify: were you asking about how the process works?

Senator LUDLAM: It was kind of a process question, because I suspect later we will hear some views about rights of appeal.

Mr Cavaleri : At the moment the appeals process is that after the Classification Board makes a decision, the publisher or the distributor can appeal the decision and get it reviewed by the review board.

Senator LUDLAM: The publisher can appeal?

Mr Cavaleri : If they think it has been incorrectly classified by the board, they can appeal it. Also, other interested parties could appeal as well, so the minister could ask for it to be relooked at.

Senator LUDLAM: What about a parent who got to see their kid watch something God-awful that they thought was wrongly classified?

Mr Curry : There are a few ways they could navigate that to be able to get it reviewed, by asking either the state or territory minister or the federal minister to have a look at it. There is an interested persons group and the threshold of that is yet to be tested. But if an interest group is concerned—a good example would be the ACCM—and they want to put forward a review, they can escalate that and get it reviewed by the review board. There is a review cost, which is $10,000 for the applicant.

Senator LUDLAM: Wow! I guess it is fairly rare then?

Mr Cavaleri : That is rare. However, if the minister decides to do it, there is no cost—the cost is to the government.

Senator LUDLAM: As a parent, I am not going to write out a cheque for $10,000 to have a piece of content reclassified.

Mr Bush : It happens in South Australia, particularly where there is a very active group of conservative parents, if I can call them that. They have gone to the South Australian Attorney and there have been reviews and appeals. That happens through the democratic process in the states where it does not cost anything.

Mr Cavaleri : We had 12 games reviewed last year on the basis that they were concerned that they were being underclassified. There are broader reforms. There would be an appeals mechanism to ensure authorised assessors are held accountable for their decisions and that would be overseen by a regulator or the Classification Board to ensure those decisions are happening properly.

Senator LUDLAM: It is not in this bill, though? That is something to come down the track?

Mr Cavaleri : It is in the bill to a point where there are mechanisms to challenge decisions that are generated by a classification tool. So if the classification tool generates an MA and someone thinks that it should be R, it is up to a legislative instrument to determine who can appeal, including whether it is a publisher or other interested group, and they will have the capacity to appeal those decisions. That is essentially asking the board to relook at the classification tool's decision.

The Classification Board will then determine whether they think their decision is likely to change. If they think it will be likely to change, they will proceed to review the game or the content themselves. It is outside the review board level so it will not attract the $10,000 review fee.

Senator LUDLAM: So these folks actually have to sit there and play a game all the way through to get to the really scary bits? Does that actually happen?

Mr Cavaleri : At the review board level?

Senator LUDLAM: No, before that. Are you talking about something that happens preliminary to that?

Mr Curry : If it is submitted to the board now, all contentious material must be submitted to the board. So, no, they do not have to play it through.

Senator LUDLAM: Because that would be pretty funny. They would need to get very good at these games.

Mr Curry : Yes. Contentious material is submitted. If not, the game will get called in to be played in front of the—

Senator LUDLAM: That makes more sense. Did you say there were 12 of these appeals last year?

Mr Cavaleri : Last year there was a group of 12 games that were reviewed by the review board.

Senator LUDLAM: As being underclassified—what did you call it?

Mr Cavaleri : The claim was that they were classified MA15+ but they should have been R. They were all found to be correctly classified as MA15+.

Senator LUDLAM: Since the introduction of the new R18+ classification, have you seen an increase or decrease in the number of appeals? I guess where I am coming from is that there was quite substantial concern that content was being squashed awkwardly into the MA15+ category that should not have really been there.

Mr Cavaleri : That was the basis of the 12 games that were submitted. The argument was that in other territories they attracted a higher classification, so it was tested against the new guidelines here. The review board found that they were all classified correctly as MA15+. Outside those, I am not aware of any other game that has been sent to the review board.

Ms Flekser : It might just be worth pointing out that the film classification review works fairly similarly to games and that there is an opportunity for interested parties to apply for a review of a film. They can apply for a fee waiver as well. Most reviews do tend to take place at the request of the actual distributor who is questioning the classification of a particular film and, in most cases, they are successful. The cost is fairly prohibitive, at around $10,000 for a review because the whole review board is brought in to Sydney to look at the film again and the distributor has an opportunity to put a case to that review board. It is also probably worth pointing out that the government is currently considering reviewing the review board and looking at an amalgamated review tribunal across a number of areas, including immigration and classification.

Senator LUDLAM: That is interesting. In the context you are describing, how common are appeals?

Ms Flekser : There are very few actually. The minister is also responsible for a few every year. I would say there are between five and 10 reviews a year at most.

Senator LUDLAM: Thank you very much for that.

CHAIR: Mr Wooldridge, you talked about different complaints from members of the public and you only had four for this particular film. How important are complaints by the public? It seems to me that it is only those who get so annoyed with it that choose to write to someone about it. Do you do other assessments beyond complaints by the public?

Mr Wooldridge : No, we do not currently. As I said in my statement, it is not definitive in terms of an evaluation of the current classification process but I think it is very directional that such a limited number of consumers, relative to the number of people who consumed the movie, felt it necessary to—

CHAIR: Take the effort to write or ring and complain?

Mr Wooldridge : Yes, four out of 4.6 million people is statistically not significant.

CHAIR: But you do not know that another million people did not have that view but were too lazy, could not be bothered—

Mr Wooldridge : No, we do not. We do not have visibility of that, but certainly the environment within which we operate now with social media and there are opportunities for the media to pick it up it does not seem to be a significant issue.

CHAIR: Fair enough. Ms Flekser and gentlemen, thank you very much for your attendance and advice. We very much appreciate that. If you have taken any questions on notice, we would like them back by 11 August.