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Wednesday, 9 May 2007
Page: 121

Senator JOHNSTON (Minister for Justice and Customs) (5:40 PM) —I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—


The transition to digital is the arguably the most important strategic issue facing Australian radio since the introduction of FM services in the 1970s and early 80s.

Radio broadcasting has an established and unique position in the Australian media landscape. It is the most ubiquitous of all media, being found in virtually every home, car and workplace in the country.

Digitisation is transforming all media and communications sectors, enabling the delivery of a common range of audio-visual, entertainment and information services to an increasingly more engaged, demanding, and fragmented audience. This is no more evident than in radio, where evolving digital technologies - such as MP3 players, iPods and other handheld digital audio devices - are changing listening patterns and re-shaping the way audio content is created, distributed and consumed.

In this context, it is notable that radio is the last significant broadcasting platform to remain analogue-only.

The Broadcasting Legislation Amendment (Digital Radio) Bill 2007 provides radio with the opportunity to build upon its existing strengths and define its position in the emerging digital landscape. By encouraging the delivery of a range of new and innovative digital services, this legislation will advance the potential consumer benefits of digital radio and enhance the high quality radio services already enjoyed by millions of Australians every day.

I now turn to the substance of the bill.

The bill amends the Broadcasting Services Act 1992, Radio communications Act 1992 and Trade Practices Act 1974 to enable the licensing, planning and regulation of digital radio services. It also provides sufficient powers for the Australian Communications and Media Authority (ACMA) and the Australian Competition and Consumer Commission (ACCC) to undertake such activities.

These amendments implement the Government’s policy framework for the introduction of digital radio services that was announced in October 2005. The key premise of the framework is that digital radio will supplement existing analogue radio services for a considerable period, and may never be a complete replacement. This is the clear message to emerge from the experience with digital radio overseas and from the research and consultations undertaken to support the development of the policy framework.

While most countries to have introduced digital radio anticipate that it will eventually replace analogue services, none have done so with a firm expectation of analogue switch-off. Analogue radio shutdown is a long-term prospect at best, with the dual operation of analogue and digital likely to continue for a significant period. In recognition of this, the bill provides for a progressive transition to digital radio, without seeking to mandate an unrealistic and costly conversion from analogue.

The first digital radio broadcasts are expected to occur in the state capital city market markets by 1 January 2009. To this end, the bill amends existing licence categories for commercial and community radio broadcasting to authorise the provision of digital radio services.

The participation of commercial, national and community broadcasters in the first phase of digital radio implementation recognises that the strength of Australian radio over recent decades has been based, in no small part, on the individual contributions made by the each of these sectors. Diversity of services will be as important to the success of digital radio as it has been in analogue, and the involvement of each these sectors will ensure the new platform can capitalise on the established skills and brand names of existing broadcasters.

These first digital radio services will be deployed using the European Digital Audio Broadcasting or DAB standard, which is the most widely deployed terrestrial digital radio system internationally and, importantly for a small market like Australia, for which a wide range of reasonably priced, consumer receivers are available.

While the Government favours an industry-based approach to developing technical standards, the bill provides ACMA with the power to determine such standards in relation to digital radio where necessary. ACMA will also be provided with the power to require industry to develop and register codes of practice relating to a range of digital radio issues and determine standards where these codes do not operate effectively. These measures will help ensure that consumers are appropriately protected as this new technology is introduced.

While digital radio services will initially be introduced in the state capital cities, listeners outside the state capitals have not been overlooked. The Government remains committed to ensuring equitable access to new services in broadcasting for people living in rural and remote Australia, and commercial broadcasters in regional markets will be provided with the opportunity to commence DAB services should they wish to do so.

The bill also provides for a statutory review of issues surrounding the development of technologies that may be better suited to rollout in regional areas. This review, due to occur by 2011, will provide a timely consideration of the opportunities for regional digital radio in the context of the development of the platform in metropolitan areas as well as internationally.

To provide a measure of stability and certainty for the commercial broadcasters as they rollout digital radio transmission infrastructure and commence broadcasts, the bill introduces a six year moratorium on the issue of new licence area planned commercial digital radio licences from the commencement of services in the respective markets. This moratorium gives effect to the Government’s 2004 election commitments and is consistent with the period of legislative protection provided for digital television.

However, the moratorium will be contingent upon each of the incumbent commercial radio broadcasting licensees commencing at least one digital radio service in the relevant market and continuing to provide such a service for the duration of the moratorium. Failure by any licensee to meet this requirement will result in the licensee forfeiting their right to provide digital radio services and will require the regulator to issue a new digital commercial radio licence for the licence area in question. This obligation will ensure that the commercial industry is provided with appropriate incentives to make the most of the opportunity to digitise provided in this bill.

The bill also provides for a statutory review of the regulatory regime for digital radio, to occur before the end of the moratorium.

In relation to the community radio sector, the bill will authorise the provision of digital radio by those community stations whose licence area is the same as licence area for the commercial radio services in the market. These services are known as wide-coverage community radio broadcasters. The bill provides for these broadcasters to form a representative company to take-up the opportunity to operate in digital on a collective and equitable basis.

The introduction of the DAB standard involves a new approach to the transmission of radio services. The DAB digital radio system utilises a multiplex to aggregate a number of radio services for transmission on the one frequency channel. While generally more spectrum efficient, this approach marks a departure from analogue radio where one service corresponds to one frequency channel.

To accommodate these new transmission arrangements, the bill establishes a new multiplex transmitter licence category. In the case of commercial and community broadcasters, the first multiplex transmitter licences will be issued via an equitable, election-based process, providing current broadcasters with the opportunity to form a company to jointly hold the licence for their services for an administrative charge only.

This is consistent with arrangements for analogue radio and digital television where broadcasters manage the transmission of their services and control the associated spectrum. Any further allocation of multiplex transmitter licences for digital commercial and community radio broadcasting services in an area will be via a price-based system.

Separately, the bill creates a specific category of multiplex transmitter licence to accommodate the digital radio services of the national broadcasters - the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service (SBS) - and provides for the reservation of frequency channel capacity for this purpose. This recognises the key role that the ABC and SBS may be able to play in driving consumer take-up of digital radio, and will ensure the ABC and SBS have access to spectrum to provide a comparable range of digital services throughout Australia as the technology is progressively introduced.

The digital radio services provided using multiplex transmitter licences will be subject to existing content regulation arrangements administered by ACMA applying to analogue radio services, including codes of practice, standards and licence conditions. With these safeguards in place, the bill provides broadcasters with the scope and stimulus to develop innovative new digital radio programming likely to be essential for the take-up of the new platform.

Commercial and community radio broadcasting licensees, together with the national broadcasters, will be permitted to provide multiple digital radio services, rather than a single stream of radio content. This harnesses the potential of the DAB standard to expand the range of radio services in a spectrum efficient manner, enabling broadcasters to provide a wide range of programming responsive to audience needs.

The delivery of unique-to-digital content has been seen to be critical in driving consumer interest in digital radio in many overseas markets. As such, there will also be no requirement for these broadcasters to simulcast their existing analogue services in digital, although some broadcasters may choose to do so. However, the bill will require that any additional multiplex capacity acquired by commercial radio broadcasters, beyond the initial ninth of a multiplex to which they are entitled, must be used to provide essentially new services.

Additionally, the bill establishes a new category of restricted datacasting licence to enable the use of the digital radio platform to offer new, non-traditional radio services, including text, data, images and related content. This provides an appropriate pathway for new entrants to digital radio during the moratorium period, and enables innovative, new digital services to emerge in response to consumer needs.

The introduction of the DAB multiplex raises a number of unique competition and access issues that are not present in analogue. With limited available spectrum for digital radio, multiplex transmitter licensees have the potential to act as gatekeepers in accessing digital radio transmission facilities in any market, with the power to set terms and conditions of access which may be unreasonable or discriminatory.

To address this concern, the bill introduces an access regime that is designed to ensure efficient, open and generally non-discriminatory access to digital radio multiplexes. The regime will require multiplex transmitter licensees providing commercial or wide-coverage community radio broadcasting services to develop and obtain approval from the ACCC for undertakings setting out the terms and conditions of access to multiplex capacity. These undertakings will be enforceable by an order made by the Federal Court.

Multiplex transmitter licensees will also be required to abide by a set of obligations relating to the use and distribution of multiplex capacity. Each incumbent digital commercial radio licensee will have an opportunity to access one ninth of the multiplex capacity on transmitter licences issued to provide the digital radio services of incumbent broadcasters (known as foundation multiplex licences). These access rights are referred to as standard access entitlements.

Community broadcasters will also have an opportunity to access multiplex capacity through standard access entitlements. The bill enables the community broadcasting representative companies to nominate licensees to hold up to two ninths of the multiplex capacity on any foundation licence. These standard access entitlements provide incumbent broadcasters with surety of access to multiplex capacity for their digital radio services, irrespective of whether or not they choose to control the relevant foundation multiplex licence.

In addition, the bill establishes obligations for the distribution of multiplex capacity not constituting part of standard access entitlements in a fair and open manner. It also sets out a requirement for multiplex licensees to uphold the technical and operating quality of services on a non-discriminatory basis. These obligations will be enforceable by an order or injunction made by the Federal Court.

Taken as a whole, the measures contained in this bill provide a sound basis for the introduction of digital radio broadcasting in Australia. The bill cements radio’s important position in the Australian media landscape, providing industry with the opportunity to invest in innovative new digital content and provide listeners with a rich and more diverse radio offering.


The Radio Licence Fees Amendment Bill 2007 complements the Broadcasting Legislation Amendment (Digital Radio) Bill 2007 which implements the Government’s policy framework for the introduction of digital radio services in Australia.

The Digital Radio Bill will allow incumbent commercial radio broadcasting licensees to provide their existing analogue services, together with one or more digital radio services, using their existing licences. Any new digital commercial radio licensees in the future will also be able to provide multiple digital services.

Taken together with the Digital Radio Bill, the Radio Licence Fees Amendment Bill would amend the Radio Licence Fees Act 1964 to ensure that all revenue earned from analog and digital radio broadcasting services is counted for the purposes of calculating the radio broadcasting licence fee.

This is consistent with the licence fee arrangements for analogue and digital broadcasting services and datacasting services provided by commercial television broadcasters.

Senator JOHNSTON —I seek leave to continue my remarks later.

Leave granted; debate adjourned.

Ordered that the resumption of the debate be made an order of the day for a later hour.