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Wednesday, 16 August 2006
Page: 23

Senator CONROY (11:16 AM) —I welcome the opportunity to finally debate the Broadcasting Legislation Amendment Bill (No. 1) 2005 [2006]. I do note the absence of the Minister for Communications, Information Technology and the Arts in the chamber. I guess that the world of fast-moving telecommunications and broadcasting is leaving her a little lagging—like our broadband speeds.

Senator Fierravanti-Wells interjecting—

Senator CONROY —I will take that interjection, Senator Fierravanti-Wells—

Senator Fierravanti-Wells —Are you reading your speech?

Senator CONROY —Copious notes. It has now been 14 months since this legislation was introduced into the parliament. This is not a record—I will be fair to Senator Coonan—but it has been 14 months since this bill was brought before the chamber. This brief piece of legislation is important for television viewers in remote areas of Australia, where there are only two commercial services on the market. The bill will assist commercial free-to-air broadcasters to deliver digital television to Australians living in these areas. If commercial broadcasters take up the options made available with this bill, viewers in places like Kalgoorlie, Port Hedland and Geraldton will be able to experience the superior picture and sound quality of digital television. They will also have the benefit of an additional commercial television service. Labor welcomes these improved services for people living in remote Australia and will support the passage of this legislation through the parliament.

This bill is also important for another reason. It allows the Senate to examine the progress that Australia has made in the transition to digital television and the government’s recently announced policy changes in its media package. These are issues that I will return to later in my remarks.

First I would like to deal with the specific measures contained in this bill. The Broadcasting Services Act sets out a framework for the provision of digital services by metropolitan and regional television licensees. Digital television transmissions began in metropolitan areas in 2001 and in most parts of regional Australia in 2004. The rollout of the infrastructure for digital broadcasting has progressed well. Free-to-air digital TV is available to 85 per cent of Australian households. The state capitals and 31 regional centres have access to all of their existing free-to-air television channels in digital. However, the Broadcasting Services Act does not contain any provisions which set a date for the commencement of digital broadcasting in remote licence areas. This reflects the fact that population density is low in remote licence areas and, typically, many retransmission sites are required to reach the audience.

These factors make the transition to digital broadcasting very expensive for licensees in remote areas. This legislation aims to reduce those costs and to increase the incentive for incumbent broadcasters to invest in digital transmission facilities. In remote areas where there are only two commercial television licensees servicing the market, broadcasters will be permitted—either individually or through the establishment of a joint venture company—to broadcast a new digital-only service.

The new service will also broadcast the digital version of the existing analog services on the same channel. In other words, commercial broadcasters in remote licence areas will be able to multichannel. Currently this is not an option open to commercial broadcasters in non-remote areas. In order to reduce the costs of establishing a new digital service, the bill offers broadcasters in remote areas relief from the high-definition quota. In metropolitan and regional markets, licensees are required to broadcast 1,040 hours per year in high-definition digital format. This bill allows remote licensees to elect to broadcast only in standard definition format. The ability to opt out of high-definition broadcasting will significantly reduce the costs of providing digital services in remote areas.

Labor understands that, on the basis of the provisions of this bill, Prime and WIN have indicated that they will form a joint venture company to introduce a new digital-only service in remote Western Australia in 2007. The new service will consist primarily of content from the Ten Network. Over time, these changes could lead to the commencement of digital services in other remote licence areas in the Northern Territory, Queensland, South Australia and New South Wales. Labor welcomes these measures to give broadcasters and viewers an incentive to invest in digital television and will support their passage through the Senate.

It is not only remote Australia, however, where policy changes are required in order to drive the take-up of digital TV. It is now more than five years since free-to-air digital television broadcasts began in this country. So far, take-up has been disappointingly slow. According to industry data, only around 20 per cent of households have purchased the necessary equipment to receive terrestrial digital free-to-air broadcasts. If you add in the households which receive digital television through pay TV, take-up rises to around 30 per cent, but not all of these households can receive the digital free-to-air channels.

Back in 2000, the government set a target to switch off analog broadcasting by the end of 2008. Of course, it has been clear for some time that there is no way this target can be met. The minister has been forced to accept this reality. Last month, as part of the government’s media policy framework, the minister announced that she has postponed digital switch-over until some time between 2010 and 2012. That is only a target; it is not a firm date. The minister has stated that she does not want to overstate the chances that Australia will achieve switch-over by 2012. The fact is that Australia can ill afford another slippage in the timetable for digital transition.

Earlier this month Senator Coonan stated that the new switch-over target aligns Australia with most comparable countries. While the targets may be aligned, digital take-up in Australia lags far behind comparable countries like the United States, Britain, Germany, Ireland, Canada, Norway and Sweden—just to name a few. If we are to achieve switch-over in a similar time frame, the government needs to aggressively drive digital. A complacent ‘she’ll be right’ approach will not get us there. So far the signs that the government will introduce the policy settings required to make switch-over by 2012 a credible objective are not good.

Last month the minister announced that the government will develop a digital action plan to drive take-up. That is right—the government has committed to a plan. After 10 years of the Howard government, five years of digital broadcasting, two years of this minister and 12 months of intensive consultations with the industry, we have a plan to have a plan. There is no detail on how switch-over will be coordinated. There is still no requirement that analog equipment be properly labelled so that consumers will know that it needs to be replaced or converted when switch-over occurs. It also remains unclear whether Australia will follow the US and phase in a requirement that new televisions include a digital tuner. There is still no plan to get community television on to a digital platform. Australia must be the only country in the world where a consumer invests in digital television and they get access to fewer television services. What a stunning achievement!

Another significant policy gap is the fact that no details have been provided on what assistance will be available to ensure that the disadvantaged are not left staring at a blank screen when switch-over occurs. In the US, congress has allocated nearly $US1 billion to subsidise the purchase of set-top boxes. In Britain, up to £400,000 will be set aside from BBC licence fees to assist the disadvantaged to switch. The task of achieving digital switch-over is a huge policy challenge. In the UK, where 72.5 per cent of households have access to digital TV, it is estimated that only 40 per cent of televisions have been converted.

Most families have more than one television. Getting one set-top box into each household will not be enough to allow switch-over to proceed. So far the efforts of the government and the industry to garner community support for digital transition have been spectacularly unsuccessful. Late last year ACMA released research on the views of people who had not yet made the switch to digital. It found that 17 per cent of respondents had never heard of digital television, 45 per cent did not know if digital services were even available in their area, 42 per cent said that they were just not interested in switching to digital and 38 per cent were not aware that digital television will replace the current analog service. ACMA’s research demonstrates that a concerted campaign is required to inform consumers about the benefits of switching to digital and to explain the process of transition. Australia’s slow progress on digital means that consumers are missing out on services that are being taken for granted in other developed countries.

A delayed transition to digital also has the potential to damage our economy. Digital broadcasting is far more efficient in its use of spectrum. There are large gains to be made from freeing up the spectrum currently used for analog broadcasting for alternative services like wireless broadband or new television channels. This digital dividend—the benefit of redeploying the spectrum currently used for analog broadcasting—could be worth hundreds of millions of dollars to Australia. In Britain, the government has estimated that the digital dividend is worth up to £2.2 billion for the UK economy. It is an indication of the Howard government’s indolence on digital policy that it has not even bothered to estimate the benefits of full digital transition. Of course, it is no mystery why it has not done that sort of work; it would only highlight the real cost to Australia of the flawed policies that the government has pursued over the last few years which have held back digital television.

Rapid transition to digital is important for the local television production industry. As consumers around the world move to embrace digital applications, like interactive television, Australian producers must keep up or risk losing export markets. A lengthy transition to digital television also imposes a direct cost on the Commonwealth budget. According to the minister’s own figures, every year around $75 million is required to meet the analog broadcasting costs of the ABC and SBS and to assist regional broadcasters—$75 million every year because we cannot get our act together.

There is a clear economic imperative to get to digital switch-over as soon as practicable. Evidence from Australia and around the world has shown that the best way to drive digital take-up is to allow media companies to provide consumers with access to attractive new content. However, in last month’s media policy statement, the government made only modest steps in this direction. There will be new digital services but they will be carefully circumscribed ‘niche’ services to ensure that they do not threaten incumbent broadcasters. The minister has suggested that there may be a boating channel or a classified advertising channel. That is right: hundreds of millions of dollars worth of spectrum will be used for a boating channel. It is highly unlikely—with no disrespect to people who own boats—that many consumers will rush out to buy a digital set-top box to access a boating channel.

Labor is concerned that the conditions on the minister’s promised new and innovative services will be so restrictive that they will not be attractive to media companies or prospective viewers. We have already been down the path where the government tried to create a new category of digital broadcasting by legislation. It was called datacasting and it was a policy disaster. The Interactive Television Research Institute, based at Perth’s Murdoch University, has described datacasting as ‘the single worst digital policy implemented in any national digital transition strategy globally’. That is right: we are the worst in the world. This policy blunder must not be repeated.

The other suggested use of the unallocated spectrum is for mobile television. No doubt mobile television will appeal to many consumers. It will do nothing, however, to bring digital switch-over any closer. By definition, these services will not be available on the household TV. They may allow us to sit somewhere other than the footy ground, watching Hawthorn or Collingwood. Madam Acting Deputy President Troeth, you will be able to pull out your mobile TV and keep track of how Hawthorn are losing to Collingwood again. But these services will not be available on the household TV.

Labor does welcome the government’s decision to allow free-to-air broadcasters to run a second digital-only channel, or a multichannel, as it is known. Again, however, the government has sought to limit the potential of the new technology. Until 2009, broadcasters will only be able to multichannel in high-definition format. That means that you will not be able to sit there and watch all of the Hawthorn matches over and over again from each season in the last few years. I know that that may excite you, Madam Acting Deputy President, and that you are going to rush out and buy one of these set-top boxes to watch those Hawthorn replays over and over again, but I suspect that that is not going to be a great turn-on for the rest of us. High-definition equipment is at least three times more expensive than standard definition equipment. Only around seven per cent of Australian households have HD equipment. It must be doubtful whether any commercial broadcaster will target a market that small.

There is only one measure in the media framework that promises to deliver attractive extra content to consumers in the short term. The government has agreed to relax the absurd genre restrictions which currently limit what the ABC and SBS can show on their digital channels. Labor welcomes this decision. Lifting the genre restrictions is a policy that the opposition has advocated since before the last election. Under the current rules, the ABC and SBS are permitted to multichannel. The ABC has used these provisions to establish ABC2 and SBS has launched a world news channel. The national broadcasters are to be commended for their determination to drive digital take-up, despite their limited resources. But the efforts of the national broadcasters to stimulate consumer interest in digital TV have been hamstrung by the genre rules. The ABC cannot show a national news bulletin, national current affairs programs or drama on ABC2. Similarly, while SBS can broadcast foreign language bulletins on its world news channel, it is not able to broadcast English language bulletins from countries like Germany, Israel or New Zealand. The genre restrictions make distinctions which are arbitrary and illogical. For example, ABC2 is permitted to broadcast ‘public policy programs’ such as Insiders but not current affairs programs like The 7.30 Report.

In the UK, extra channels and interactive services offered by the BBC have made an important contribution to generating consumer demand for digital. Under its new charter, the BBC will be given a leading role in building a digital Britain. Labor believes that our national broadcasters need to be given the regulatory freedom and financial resources to undertake a similar task in Australia. As I said, the minister has announced her intention to relax the genre restrictions as part of her media package. There is, however, no need to wait before taking action to improve the incentive for consumers to invest in digital television. The Senate should act today. Taxpayers have invested over $1 billion so that the national broadcasters could make the transition to digital broadcasting.

When this bill enters the committee stage, I will move amendments to immediately lift the genre restrictions. I hope that all senators interested in driving the take-up of digital television will support those amendments so that the digital chains can be lifted from our national broadcasters, and so that Senator Troeth can get her Hawthorn channel and Senator Kemp can get his Carlton channel—although, given that they are going for back-to-back wooden spoons, I am not sure that you are really going to want to sign up to that, Senator Kemp. As you know, Collingwood supporters are always behind Carlton winning another wooden spoon. (Time expired)