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Wednesday, 11 October 2006
Page: 31

Senator ADAMS (11:45 AM) —Unlike Senator Bartlett, I would like to speak about media ownership reforms and regional protections. Being a rural consumer of radio and other media forms, I think it is very important that the rural voice is heard here. I would like to speak about the media reform package that the government announced on 13 July, which outlines major reforms to Australia’s media ownership laws as part of a broader reform package relating to the new digital services and other key broadcasting issues. These reforms have been the subject of lengthy and widespread consultation within government, industry, the community and other interested stakeholders.

The media landscape is changing rapidly, and a flexible system is needed to allow media companies to adapt and prosper in the new digital environment. A farsighted approach is needed to meet the needs of consumers now and to provide the benefits of new technology into the future. At the heart of the package are new services and programming for consumers. These reforms will enable existing players to make the most of emerging digital media technologies and give them the flexibility to structure their businesses to be globally competitive media companies. The package will allow a better competitive environment and encourage new entrants into the media market offering diversity and choice to consumers.

While the reforms will allow for some cross-media mergers, they also contain significant safeguards to protect diversity and stop undue concentration, particularly in regional areas. The Trade Practices Act 1974 will continue to apply to media transactions, and the Australian Competition and Consumer Commission, known as the ACCC, will play a critical role in assessing competition issues associated with mergers.

Separate from the protection of competition, ACMA will oversee the safeguards to ensure diversity and local content, including ensuring transactions comply with the minimum number of media groups requirements, and that broadcasters comply with their local content obligations. Protection of regional content and diversity for consumers is a key component of the media reform package.

There are a number of measures contained in the framework to ensure that regional consumers do not miss out on the benefits of media reform. It is important to remember that, in addition to the traditional commercial media, Australians will continue to have access to a variety of other services. These include ABC services, with two digital TV channels, up to five radio stations—Radio National, News Radio, Local Radio, Classic FM and Triple J—and its comprehensive online services; SBS’s comprehensive television, radio and online services; subscription television; community radio and television; out of area and national newspapers; and the myriad of services available over the internet.

The government is committed to ensuring that all Australians, not just those in metropolitan areas, benefit from these reforms. The government is committed to reforming Australia’s media ownership laws, while protecting the public interest in a diverse and vibrant media sector. The government is very aware of the needs and concerns of regional Australia and this package will ensure that both consumers and industry in regional Australia do not miss out on the benefits of reform.

Protection of regional content and diversity for consumers is, however, a key component of the media reform package. The community has a legitimate expectation that broadcasters will cover local news and content. Regional commercial radio licensees whose control arrangements do not change and/or whose format remains one of broad appeal will not be affected by the measures proposed in the bill. The government believes that the community has an expectation that media mergers should not come at the expense of localism.

For 20 years, Australia has had a set of media control rules that amount to a major restriction on how media markets and companies operate. This is based on an outdated philosophy based on containment. That philosophy does not recognise how media companies operate today, how technology has changed and how people consume media today. When those rules were framed, the Internet was mainly confined to academics, pay TV was in its infancy in Australia, there was no framework for digital radio, IPTV had not been thought of, let alone 3G mobile phones, video, iPods or television over a mobile device otherwise known as DVB-H.

The current foreign and cross-media ownership restrictions under the Broadcasting Services Act 1992, BSA, limit competition in the media sector and restrict access to capital, expertise and technology. The proposed changes will encourage greater competition and will allow media companies to achieve economies of scale and scope, while protecting the diversity of Australia’s media. Pressures on our traditional media platforms are coming from all angles. If we want them to be able to survive and compete, we must free up some of the regulation currently placed upon them and allow them to adapt. Without this change, the traditional media industry will continue to watch other platforms encroach on their traditional business and not be able to move themselves, while new media stake their claim.

Amending the ownership rules will let the media market operate more efficiently, benefiting industry and consumers alike by permitting greater competition and economies of scale and scope. Those benefits will be diffuse, dynamic and shared across a large sector of the economy. As with other microeconomic reforms undertaken by this government, the benefits of reforming the media ownership restrictions are real—for example, the removal of foreign ownership restrictions will allow foreign media companies and investors to enter the television and daily newspaper markets, providing greater opportunities for investment, new players and new services.

Australia’s radio sector does not have foreign ownership restrictions. It is significantly more diverse in its ownership than either television or newspapers, with two major foreign owners in the sector—that is, APN and DMG. Similarly, the removal of cross-media restrictions will allow Australian media companies to enter different media, which will provide greater competition, opportunities for greater efficiency and new and improved services to consumers. Clearly any reform needs to protect diversity of ownership, but this can be done in a way that is less restrictive than it is currently. The diversity of ownership, which everyone agrees is important, will continue to be protected by the five-four voices requirement, and licence and reach limits. The current media ownership laws regulate commercial radio and television and daily newspapers above other media by virtue of their greater level of influence.

In 1987 TV, radio and newspapers were virtually the only news media. Whilst they remain highly influential they are no longer the sole source of news and information. Whilst traditional news gathering remains dominated by old media, the capacity of independent online sources to handle news more quickly and to comment, analyse and spread information that would otherwise be restricted means that online news and information has emerged as a powerful influence in its own right. From my point of view, living in a rural area 15 kilometres from where I can obtain a newspaper, my HiBIS satellite internet connection allows me to go online to read news briefs and to keep up with what is going on in the world long before I can obtain a newspaper. A regulatory framework that assumes that radio, television and newspapers are the only sources of information will become hopelessly outdated and ineffective, ultimately to the detriment of services and consumers.

This bill will remove the broadcasting-specific restrictions on foreign investment in Australia’s media sector. The media will remain a sensitive sector under foreign investment policy as well as under the Australia-United States Free Trade Agreement. This means that all direct media investment and all portfolio investment over five per cent will be required to be notified to, and approved by, the Treasurer. The opposition maintains an outdated and mogul-specific approach to media ownership laws which restricts investment and expansion of the Australian media sector and favours foreign investment over diversified investment by Australian investors.

As an additional safeguard against undue media concentration, the government will amend the bill to include a two out of three rule for media mergers in metropolitan and regional areas. This means that media mergers will still be permitted subject to the floor of four voices in regional areas and five voices in metropolitan areas. But mergers will only be permitted between two of the three regulated platforms in a licensed area: commercial TV, commercial radio and associated newspapers. In other words, this rule will prevent three-way mergers between commercial TV and commercial radio and an associated newspaper in a licensed area.

The Senate Standing Committee on Environment, Communications, Information Technology and the Arts report recommended that this rule be introduced in regional areas. However, the government has decided that it is appropriate to extend this additional safeguard to all licensed areas. Industry will still benefit from the increased flexibility that relaxation of the cross-media ownership laws will bring. Consumers can be confident that diversity will continue to be protected through the range of safeguards that the government is including in the bills.

In addition to the benefits that media ownership reform will bring, this package will also open up significant opportunities for new services. There will be two channels of currently unallocated spectrum made available for new, home and other services, such as mobile TV. The national broadcasters will be able to provide a broader range of content on their multichannels. The free-to-air broadcasters will be permitted to provide a high-definition multichannel from next year and a standard-definition multichannel from 2009. I note that the standard definition multichannel for commercial stations could perhaps come into effect in 2007, but that is not the government’s intention at this time.

Once we reach switchover and a significant amount of additional spectrum is freed up, even more opportunities for new services will emerge. This bill forms part of an integrated and far-reaching package which will assist Australia’s media sector to move to a new digital environment by encouraging new players and new services for Australian consumers. It is clear to the government and industry that the media landscape is changing rapidly and that a flexible system is needed to allow media companies to adapt and prosper in the new digital environment.

A far-sighted approach is needed to meet the needs of consumers now and to provide the benefits of new technology into the future. The government’s media package, the Broadcasting Services Amendment (Media Ownership) Bill 2006 and the Broadcasting Legislation Amendment (Digital Television) Bill 2006, will open up opportunities for a range of innovative new services to consumers while maintaining existing services that the community already relies on and enjoys, including quality free-to-air television services. The proposed reforms will enable existing players to make the most of the emerging digital technologies and give them the flexibility to structure their businesses to be globally competitive media companies. It is the consumers who will be the biggest winners, with access to a range of new services, potentially including several new digital channels, with even more to come in the full transition to digital television.

Whilst this bill introduces some modifications to the anti-siphoning scheme, the government is not proposing to abolish the anti-siphoning list. The government recognises the keen interest of many Australians in continuing to have free access to major sporting events that have traditionally been shown on free-to-air television, and to ensure that live and local content continues to flourish in rural and regional Australia, the government will mandate a minimum of 12.5 minutes of local news on at least five days a week.

In recognition of concerns expressed about the provision of live, locally produced and locally relevant content, the government will amend the bill to require ACMA to have in place for all regional radio licensees from a specified date a requirement for at least 4.5 hours of local content each day. This will be similar to the proposed new section 43A in the bill, which requires ACMA to have local content licence conditions in place for regional television. Prior to the requirement coming into effect, ACMA will be directed by the minister under section 171 of the Broadcasting Services Act 1992 to investigate the current levels of local content in regional radio, the impact of the proposed minimum level on licensees and how different types of regional broadcasters such as licensees in smaller licence areas would be affected by the requirement. Once the outcome of the review is known, the minister will have the power to adjust the level or apply the requirement differently across different classes of licence, if appropriate.

I myself find that a lot of the evidence that has been given in getting the minister to accept local content is very important. I am a Western Australian and live in the Great Southern region of Western Australia, and we have had a very different experience of local content. Our local content tends to override the content that we receive from the Perth metropolitan area. During estimates earlier this year, I raised the issue of local versus national content on ABC radio in my home state of Western Australia. As I said, I live in the Great Southern region. We had an ABC morning program which was hosted by Liam Bartlett. Most of you would now know that Liam has since moved on to television, where he is reporting for 60 Minutes. But, prior to his departure from ABC radio, this program was broadcast throughout the state. It used to go from 8.30 in the morning until 11 o’clock, but unfortunately the ABC in their wisdom decided to cut off the Great Southern area of Western Australia at 10 o’clock in favour of local radio programs.

This was very difficult for someone in my position, and I had a huge number of emails and letters from my constituents when this happened, because, for a lot of the very important content that affected Western Australia and often regional Australia—especially when the Telstra inquiry was going on, which was looking at regional and rural phone services—we were cut off at 10 o’clock, and most of the talkback service occurred between 10 and 11. Especially, we would have our state or federal members of parliament speaking on that segment. The only way I could listen to that was to drive up to a hilly area on our property, from where I could get that reception. But it was rather difficult, especially early in the morning when I was trying to listen to our political commentator, ABC journalist Peter Kennedy, who would give us an update on Monday and Friday mornings on political issues that were going on in the state, which were very important. Our farm worker used to say: ‘What on earth is your wife doing way up the hill in her vehicle? What’s she doing?’ The fact was that it was the only way I could get this broadcast. I think it is very sad that these issues were going on and we were not able to receive the broadcast.

So I think it is very important that people in rural and regional areas are given the opportunity to voice their opinions on this part of the legislation. When the minister has her inquiry into how rural and regional people in Western Australia review local content, I think she will be told that we do have plenty and we really would like some more of the other content. In closing, I would like to commend the minister on the number of very difficult and involved bills that she has negotiated very well. She seems to have accommodated all those who needed changes and amendments to the bills. I commend the bill.