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(generated from captions) Good afternoon. Welcome to

PM Agenda. I'm David Speers.

The tremors and aftershocks

from this week's two big media announcements will be

felt for months and years to

come, but the difference

between today's News Limited

announcement and Monday's

Fairfax announcement are like

chalk and cheese. On Monday

Fairfax announced 1900 job

cuts, the closure of two big

printing outlets and the

reduction of its flagship papers the 'Sydney Morning

Herald' and the 'Age' down to

slimline tabloid form. A lot

of pessimism in Fairfax

offices around the country

since that announcement.

Today, by contrast, News

Limited announced an un

specified number of redundancies. That's still

to be worked out, but it

won't be anything like the

1900 at Fairfax, but a far

more positive outlook from

the chief executive officer,

Kim Williams. He's coupled

today's announcement of

streamlined management and

editorial processes with new acquisitions. News Limited

is expanding its footprint in

the Australian media and into television, specifically pay television. News Limited

wants to buy Consolidated

Media, 100% of it. It's

half-owned by James Packer at

the moment, and he's happy

with the takeover offer News

Limited have offered, values Consolidated Media at around

$2 billion, or just under $2

billion. This would give

News Limited a 50% stake in

Foxtel and 100% owner #147 of

News Limited also moving more Fox Sports in particular.

into the online business

space with the purchase of

business spectator and the

Eureka Report, Kim Williams,

describing today's vision for

the future as innovative and

about ensuring that it takes

advantage of the changes that

are under way in the media

land #1k5i7. Scape. The

reaction to the announcement

today has been positive, even from Communications Minister

Stephen Conroy, who has not

always seen eye to eye with

News. He told us just a

short time ago that relations

between this Labor Government

and News Limited have

improved substantially and,

in particular, he puts that

down to the new leadership of

Kim Williams. Coming up,

we'll play you a bit more of

that interview with Stephen

Conroy. We'll also be going

live to Kim Williams, the

chief executive officer of

News Limited, a live

interview from his office in

Holt Street in Sydney with

bridy Barry, in about ten or fiftheen minutes from now.

Stay with us. We'll also be

joined by senior journalists

from News Limited and Fairfax

this afternoon for a look at

the shake-ups in the media

landscape and also what else

has been happening in

politics today. First back

to the news centre for the

top stories this hour. Thank

you, David. As you mentioned, News Limited has

announced a major restructure

that will see its east coast

operations in Australia

shrink from 19 to just five

divisions, axing jobs in the

process. In a video address

to staff, News CEO Kim Williams didn't put a figure

on the number of

redundancies, but reports

indicate they're likely to be

less than the 1900 announced

by Fairfax on Monday. Under

the restructure, the remaining divisions will be

News NSW, News Queensland,

News Victoria, the

'Australian' and Newslife

Media, formerly known as News

Magazines. Its stand-alone

digital division News Digital

Media will be incorporated

flew the divisions. Mr

Williams also confirmed a $2

billion offer for

Consolidated Media and the

purchase of Australian

independent business media,

publisher of the business

spectator website and Eureka

Report. Unlike Fairfax, Mr

Williams says News Limited

remains committed to print

businesses and won't be

closing any of its printing

plants. G20 talks have

closed, with leaders failing

to act together to strengthen

economic recovery and address financial market tensions.

The final communique includes

a commitment by Eurozone

members to improve the

functioning of financial

markets and work with

troubled countries. Kieran

Gilbert is in Los Cabos and

filed this report. The G20

has wrapped up here. It was

held in the wake of the Greek

elections. A lot of focus on

the European debt crisis.

Did they deliver? Certainly

the language was not emphatic

in the final communique, but

at least it's a step forward. The Prime Minister, Julia

Gillard, and the US

President, bram, among

others, said it is an

important step towards

Europeans having further

banking integration. That's

really going to be one of the

important things to underpin

Europe and to ensure the debt

contagion doesn't spread.

The real focus now turns to

the European Union meeting in

a fortnight, when the global

leadership, the non-European

leaders, are hoping that they

come up with some concrete

reforms to stop this

spreading. Victorians are contagion

recovering from one of the

largest earthquakes on record

after it shook parts of the

State overnight. Millions

felt the tremor, which lasted

up to a minute. Several

houses suffered cracks to

their walls and ceilings.

Sky News Melbourne reporter

Matt Gallant has the details. Many Victorians were

woken up with a shock last

night as a 5.3 magnitude

earthquake hit parts of the

State just before 9 o'clock

Tuesday night, lasting

roughly 15 to 60 seconds, the

quake was felt from its epi

centre 10km south of Moe all

the way to northern Victoria

near Albury Wodonga. The

quake hit 9.9km underground

and Moe residents say it was

a frightening experience they

won't forget. Very scary, a

couple of things broke. Then

when I got up this morning

there were a couple of frames

that had fallen over in the

lounge room. I have a little

pup, it went to the toilet

inside the van, I put it

outside, 2 seconds later, as

I'm walking back, I sat down

on the bed and the whole bed

- things were falling from

everywhere. I didn't know

what to expect. It was like being in the middle of Bass Strait. The quake damaged properties across the State,

with reports of cracked

windows, walls and ceilings. A garage was also reported to

have collapsed. Geoscience

Australia says even though

we've seen after 60

aftershocks since last night's tremor, the worst is

behind us. We're dispatching aftershock equipment

currently. We'll have some

more seismometers to densify

the network in that region so

we can pick up aftershocks.

There have been well over 60 aftershocks recorded.

They're not huge, they're all

less than the main shock.

We're hoping that things will

calm down over the next few

days. A main inconvenience to

the people here in Moe in the

town centre was the closure

of their main grocery store,

which was shut down due to

concerns over its structural

integrity. The SES have put

out a warning to the public

to seek professional advice

if they have any concerns

over property damage after

receiving over 30 calls

overnight. If you do notice

building damage to your residential property or business, it's very important

that you get that assessed by

a qualified building

professional. There are some

risks well after the quake

has passed that you can have

some residential damage or buildings actually coming

down in part and causing

injury or worse. The

magnitude 5.3 quake is the largest on record in Victoria

for more than a

century. Julian Assange is

holed up in Ecuador's London

embassy, where he has

formally applied for asylum.

The WikiLeaks founder has

told the Ecuadoran Government that the Australian

Government has abandoned him

in the face of political persecution. Julian Assange

is facing extradition to

Sweden over sexual assault

allegations he denies, but

it's the United States he's

most fearful of, arriving at

the Ecuadoran embassy in

London, the WikiLeaks founder

appealed for political

asylum, claiming he's being

investigated for political

crimes in the US, a country

where the death penalty for

such offences is still in

force. He's been left no

other opportunity than to

seek any kind of justice

other than to apply for

political asylum, as he's

obviously a political

prisoner now. I think he has well-founded concerns after

being branded a terrorist by

the Vice President of the US

and commentators right across

the spectrum, then seeing

evidence they are intending

to prosecute him for potentially crimes that would

see him go away for life in an American jail and the Australian Government's

response has been absolutely

feeble. But the Australian Government insists it has

seen no evidence, suggesting

the US has any plans to

extradite and prosecute

Julian Assange. If it did

get to that point, the Prime

Minister says Australia would

respond as it always does.

For any Australian citizen at

any time in any

circumstances, we oppose

extradition for death penalty cases. The Australian

Government hasn't gone after

the evidence. At no stage do

they seem to have said to the

US Government "Are you

intending to prosecute and extradite Julian Assange or

not"? If they have, they're

not telling us. Mr Assange

told the Ecuadorans Australia

has abandoned him, saying his

home country is ignoring the

obligation to protect its citizen. The Opposition

agrees the case has been mis

handled. There's been Stony

silence from this Government,

other than the Prime Minister

declaring that his conduct in

relation to WikiLeaks was

illegal, and Nicola Roxon

saying that he had fled from

Sweden, an accusation that

Julian Assange denies. But

the Government points out Mr

Assange has received more

consular help than any other

Australian abroad. He's

received the benefit of full

consular support and, of

course, Australia will

continue to support Mr

Assange, just as we do

support any Australian

overseas who face s legal

difficulties or dilemmas. We

all know what Prime Minister

Gillard is like. She's like

a US wound-up robot. Out

come the weazel words, the consular assistance. He's received no consular

assistance for the last 12

months. Applying to Ecuador

of all countries may seem

like a strange choice, but

the South American nation has

been sympathetic to Julian

Assange in the past. A few

months ago Mr Assange

interviewed the country's

left-leaning President and

back in 2010 he was offered

residency in Ecuador,

although that offer was later

retracted. He thinks it's

potentially a friendly

Government who will take a good look at the evidence that he's going to put to them. In the mean time,

Ecuador's embassy in London

says Mr Assange will remain

there under protection of its government. Swimming

Australia has cancelled a

relay camp and this week's Grand Prix after an outbreak

of hooping cough at the

Institute of Sport. Two

members of the women's water

polo team have been diagnosed

with the disease and the team

has been placed in isolation

to limit infection. Swimming Australia cancelled this

weekend's event as a

precaution to make sure the

athlete stay healthy ahead of

the London Games. A look at

the weather now - wet and

windy and becoming cold in

the south and south-east.

Dryer conditions in the west.

Now back to David Speers in

Canberra as PM Agenda

continues sglchlt Mike, thank

you. After the break on PM

Agenda, a live interview, the

first live interview with

News Limited CEO Kim

Williams. Stay with us.

Good afternoon. Welcome to

padgedz. I'm David Speers coming to you live from

Parliament House in Canberra

this afternoon. The big news this afternoon, News Limited announcing changes to the

company's outlook for the

future and how it operates

internally and expanding its

footprint across the

Australian media. This is

the second big media announcement of the week, but

it couldn't be any more

different to the one we heard

on Monday from Fairfax,

Fairfax announcing 1900 job

losses, the closure of two

printing presses and the

reduction in size of 'Sydney

Morning Herald' and the 'Age' in Melbourne. News Limited,

by contrast, is being fairly

optimistic about the outlook.

It's spending up nearly $2

billion to expand its

presence in pay TV in

particular. It wants to buy

Consolidated Media, which is

50% owned by James Packer,

and Packer at least is happy to sell at the price that

News Limited is offering, it

seems, $3.50 a share, nearly

$2 billion. This will give

News Limited 100% ownership

of Fox Sports and a 50% stake

in Foxtel. On top of that,

News Limited also picking up

two fairly profitable and

successful online business

publications, Business

Spectator and Eureka report,

so expanding its reach there.

At the same time, though,

it's going to make a number

of streamlined management changes within its newspaper

division to improve the way

it works, make it more

efficient. Kim Williams, the

CEO of News Limited, former

CEO of Foxtel - we're about

to hear from him in the first

interview on the changes.

Bridy Barry, our business correspondent, is standing

by. We'll go to that live as

soon as we can. In the mean

time, let's get a little bit

of reaction to this from two

senior journalists in each of

these stables, Tony Wright

writes for the 'Age'

newspaper, Malcolm Farr from

Newsonline, news dotcom.

Thanks both for joining us. Malcolm, technically you work for the news digital

division, which is being

folded into the more general

News Limited. Are you

worried about the changes at

all? There's an unknown

number of redundancies coming

down the pipe. Obviously

this isn't a terrific time to

be absolutely certain about

your job, but I think we can

be pretty confident in the

future of News. You pointed

that out. Fairfax executives

went out in public and said

"Watch as we slash ourselves

to death with these hack

saws" I don't know about to

death. Well, we're not

exactly healthy - let us

underline the fact that we're

in crisis for you. We'll do

that publicly and overwhelmingly, where in News

Limited the approach has been quite different, more

positive, the spending that you're talking about. I

think the differences are

more than cosmetic. I think

-- There was a slick video

presentation from Kim

Williams this afternoon, but

they are material changes in

expanding into pay TV in a

bigger way and no doubt these

internal changes too to drive efficiencies. I just want

you to explain to us, the

headline is collapsing the

number of divisions from 19

down to 5. What does that mean? If you think of News

Limited as an empire, an

empire with many provinces,

so a lot of those provinces

have been folded into others,

as you say, without reducing

the size of the empire. News

Limited traditionally had a

reputation for very lean

management and I think it's

going back to those days,

streamlining those days, just as - streamlining that

management, just as it's

streamlining the editorial

process. I don't think

there's anything particularly

significant in that,

although, of course, we have

the difficult business of

people being told that

they're redundant once that

process is under way. That's

to come. The bad news is to

come. Tony Wright, how do

you think this contrast s to

the Fairfax announcement The

Fairfax announcement was a big-bang announcement to deal

with what newspaper condition

s all around the world have

been dealing with for quite

some time, and while Malcolm

says that News isn't getting

any smaller, we don't know

what the redundancies are

going to be there. A lot of these things are about

efficiencies, but it's also

much more about Fairfax going

digital first; that is, it is

no longer necessarily a

newspaper company. The two

big mastheads, the 'Sydney

Morning Herald' and the

'Age', will become compact

size or tabloid size,

whatever you call it. The

presses are being sold. All

the various division s which

you could call silos are

going to be streamlined, if

you like, into a much more

efficient operation. Certainly the

market likes the Fairfax

announcement, even if the

journalists didn't much. Of

course it does.

Unfortunately the markets

always like the idea of

people losing their job s and

something becoming more

efficient, because the

possibility is there of

better dividends down the

track. But Fairfax didn't

have any choice. People have

known about what is happening

to companies like Fairfax for

a long time. It's held out.

Broad sheets no longer really

exist in the world. I think

the Independent in Britain -

I think that's the only one

left. There are a lot of

cities in the United States

that don't even have a

newspaper anymore, and so the

digital era, which has been

upon us for quite some time,

is now our future. I want to

explore this a little

further, but we're now going

to go live to News Limited

headquarters in Sydney, where

the News Limited chief

executive officer, Kim

Williams, is talking live to

our business correspond yint,

bridy Barry. Kim Williams,

thank you so much for joining

us. Pleasure. This is a big

restructure, 19 divisions to

5. Are you able to put a

number on the redundancies

that will be needed? No,

we're going into a program

over the next 18 to 24 months

of re-engineering our

business and we don't have a

final number. In fact, we

intend to make as many of the

changes using natural

attrition as possible,

because we'd like to minimise

human impact. I did ask our people and culture team

yesterday - I said, "Well,

look, what is a worst-case

number", and they said,

"Look, we don't actually have

a final number on that, but we're comfortable about saying it's significantly lower than the number

announced by the other media

company the other day."

Don't staff deserve to know,

though? There is

nervousness. Bridy, the issue here is about going

forward. The issue is that

we will be transparent at

each stage of the

transformation, but I can't

wave a magic wand. I can't

say that waving a magic wand, suddenly everything has

changed and we are we're in

the new set-up. Frankly, I

think simply raising a number

is reckless, because it

doesn't actually address the

issue which is the real issue

for all people in any work

force, is it me or someone

else? The issue is about

saying we're going forward,

we have a plan, the plan

makes sense, the plan is

necessary and the plan is one

that is built around serving

customers better and

producing better

products. You must have a

number, though, in mind at

Fairfax Media -- I can tell

you I'm not in any way dissem

belling you, I've done a detailed presentation to senior leadership and

editorial team today. I've

just come from a session with all of our editor s across the country and I've been very plain with them. We need to work these things through. We're not rushing things. We're doing things properly. We are repositioning and rebasing our company in a way that nothing at all to do with my plan and my program, which is about properly positioning this company. Looking, though, at the streamlining of the operations, are you able to say where most, though, of the redundancies - is it management? A lot of these efficiencies that come about are because of technology we're introducing and because of backroom processes. But in terms of going into some kind of public celebration of those numbers, I'm simply not going to do it. In terms, though, of content, if there is going to be losses of journalists, is there a concern, though, that the quality of the content will suffer? No, the one thing I absolutely guarantee you is that the quality of content at News will only improve. All of the changes that we are

making are about having better focus on con extent. One criticism has

been that there's investment,

yes, in the announcement s

today, but a lot of them are

aimed at specialist and

profitable areas, things like

sport and entertainment and business. Does that mean that traditional news

gathering is going to be

moved away from? Perhaps you

didn't read the announcement

that I issued or look at the

video that I released to our video that I released to our

own work force, which we made

available to everyone. We're

investing $60 million in an

entirely new editorial system

called Azos Methode, which

allows to publish on any form

of device, part of our

customer first strategy,

where we publish according to

customer need on the platform

that is available and relevant at the moment, relevant at the moment,

whether online, whether with

social media, whether with

mobile or tablets or with

print or broadcast. It is

able to facilitate easy

provisioning of content, both

in terms of text, audio,

video and pictures, very,

very simply. I want to get

further into your thoughts on

the outlook, and particularly what you said about print

today in a moment, but firstly I firstly I wanted to ask you

about the moves by Gina

Rinehart at News's major

publisher rival in Fairfax.

Should Gina Rinehart sign an

editorial charter of independence? Look, I have no

view about commenting on

issues at Fairfax and issues

of governance at Fairfax.

They're completely outside of

my remit of responsibility

and it's not something that, frankly, I'd regard

frankly, I'd regard it as impertinent to offer my views

on that. I think those views

would be disregarded by all

and sundry, and so they

should be. We have seen the

Greens pushing - they want to

legislate to force media

owners to guarantee editorial

-- I think the notion of

legislating challenged

technologies is really, very,

very childish. This is in the I want the the I want the world to be in the shape I describe it

because I'm right because I

say I'm right. It's very

foolish behaviour. Obviously

we're waiting for the

Government to respond to two big media reviews at the

moment. What's your view on

the political climate, in

light of what we've been

hearing from the

Greens? Well, the Finkelstein

report was one on which I've

gone on the record and indicated we thought many of

the recommendations were mis

conceived and disappointing.

The notion of having an

adjudicator as a


regulator who can demand that

certain actions be taken and

jail journalists in the

instance of non-compliance,

but have no responsibility to

be accountable for the

decision in terms of publishing reasons and to

have no recourse to any kind of appellate of appellate process through administrative appeals and

other things, as normal in

all of our common law

jurisdiction, is, frankly,

repugnant and I think quite

unacceptable and has no place

in the 21st century. It's a

reversion to a

Stalinist-style model. In

terms of the approach that

was recommended for the

convergence review, I think

there is still recourse to regulation because I say

there shall be regulation

because regulation is good, rather than rather than actually

listening to a lot of the

very thoughtful and considered comments that have

been offered by media

companies and also to the

very spirited injection of

fresh powers and finances into the Australian press

council, which is a body that

has been considerably

enhanced through this process

in terms of its a Jude

cattive powers over its members. Just coming to relations with the

Government, because certainly Government, because certainly

they had been tense between

News Limited and the

Government, Stephen Conroy,

Communications Minister, has

told it David Speers this

afternoon relations with News

Limited have im pod proved a

lot under your leadership.

Is that how you see it? Look,

I seek for our media company

to be a reliable presenter of news, information, opinion

and analysis about Australian

society, as it has always done done and as it will continue

to do. I think that we adopt

an approach which absolutely

accords with good

journalistic practice and

good editorial standards and

I will fiercely, ferociously

promote all of our work force

to do the right thing in

terms of being great journalists. We stand with

our people. Just finally on

Gina Rinehart, have you given any thought to what

any thought to what her

intentions might be for her

stake in Fairfax? I've been rather preoccupied with a

whole lot of transformation issues at News Limited and

with our great products, with

our people, with technology

issues and product issues and

even with some issues of takeover, which I think are

much more relevant to my day

job and night job. Just on

what you had to say today,

because it was very different

to the feeling that we got

from Fairfax Media at their

radical restructure announcement earlier this

week, you said print is not

dead, it has a strong future. Do you really believe that

when we're seeing these sharp

declines in print circulations? Well, I must

say I have some frustration

with the extravagance of

language that simply embrace

s something in the ether which has

which has no relationship to

life. Circulation on average

across the the current 12-month period for News Limited publications is down

by 2%. Now, would we prefer

it's not down by 2%? Of

course. But it's down by 2%.

Let's not make it out as if

it's down by 10% or 15%; it's

down by 2%. But the trend is declining. The trend has

declined, but the trend has

declined in what could be

regarded as a graceful way,

and I announced to our set of

leaders today a number of

initiatives that are actually

about managing and actually

responding to a number of the

circulation issues that have arisen through talking with

our retail agents in the news

agency networks to

significantly improve the way

in which we distribute

products. There are many

things that are within our

capability to address and

manage to ensure that print

has a secure and durable

life. Will print go on

forever? I don't think any

of us knows the answer to

that at the moment.

Certainly I see a comfortable

period over the next decade, which is about the longest

kind of planning period that any business person can look

at, where we will actually

have a good, secure and profitable life. We

certainly know the products

work, we know they work for

advertisers and we know that

we sell over 11 million

newspapers every week. 11

million sold products on a

weekly basis and a national

reach with audience of around

13 million readers each and

every week is hardly a

significant of a dying

business. And of course we

have 12 million have 12 million new every

week for our websites. It's

a much more complex issue

than that. I think there's

an awful lot of sloganuring

and quite silly commentary

about it. You still see there

being printed edition s of

the 'Australian' newspaper

and all other mastheads in the News Limited stable in 10

years time? Look, over the

foresybl future I see a very healthy healthy product outlook for a

range of platforms. Print,

online, mobile, smart devices

like tablets and phones, broadcasting, and social

media all have their role to

play, all have a very vibrant

and different personality,

have different uses, have different times of the day

when consumers use them.

We're moving into a very

complicated operating

framework and I think it is

really foolhardy to be

anything other than a very

acute and astute listener to

the audience. The audience

determines the outcome. The

consumer will determine the

outcome. If I am wrong about

print, we'll change course,

but I see a very, very

reliable and steady

consumption of our print

products. Even though we see

US newspaper publishers

cutting down to three day a

week edition s, Fairfax -- I

watch what happens in America

with interest, but that's not

the experience of news in

Australia, so what do you

want me to respond to, the

situation in America or the situation in

Australia? Fairfax Media CEO, though, did say on Monday

that they have the option there of

there of a digital-only

business if it comes to

that. Well, different

companies call shot in

different ways. I would note

that our company is somewhat

larger, has somewhat more

dedicated interest in print

and has somewhat more

dedicated interest in a

diversity of products than

many other media companies in this space sglchlt generating

the revenues from the digital

side of the business - how crucial is that at this

stage? Oh, I think generating

a very good, secure outlook

on digital products and on

digital product invention is

terribly important. I think

consumers expect it of

you. Looking at the the

'Australian', the premium

model that has been set up

for the 'Australian', how

many subscribers do you have,

paying subscribers? We've published the numbers on the published the numbers on the

'Australian', some page

subscription numbers, for

some months now and at the

moment we're a little over

40,000 paying subscribers for

the digital product of the 'Australian'. How soon will

you be rolling out that model

to the other mastheads? We'll

make announcements in due course about other paid

content initiatives. We're

currently running a very

reactive period of trial reactive period of trial with

hrld Sun. As I indicated

before, we spend a lot of

time listening to consumers,

talking with consumers and examining consumer data in

order to have the relevant

insights that can guide our

thinking as to future product

plans. Do you have a timeline

in your head or a pace at

which you believe consumers

will accept that they do have

to pay for quality news content

content online? Look, I think

the reality of paying for

content is something that

consumers readily accept.

It's just that the news

provisioning industry elected for a very long period of

time to give it away for

nothing. I note that our

colleagues at Fairfax

elected, at their own behes,

to give away the applications that they have for that they have for the 'Sydney Morning Herald' and

the 'Age'. Now, that's their decision and their call and

they're indicating that they

might be changing course in

relation to that. We made a

decision some time ago that we would move progressively

to a paid con tentz model and

that we would have an active

test, listen and learn

approach to that, because consumers are your guide. We

know consumers pay for

content, we know that in

terms of books, we know that

in terms of newspapers, we

know that in terms of magazines, we know that in

terms of a whole range of

journals, we know that in terms of subscription television, we know that in

terms of DVDs, we know that

in terms of games. The issue of paying is not an issue.

The issue is about what the

content is, what the package

is, what the price is, what

the model is. These are complex questions and the

guide will always be the

consumer. The fact that

Fairfax has now moved to set

up premium pay walls around

the 'Sydney Morning Herald'

and the 'Age' -- No, they

haven't, Fairfax has made a

series of statements. What

we do is actually take

actions. Will that, once they

do implement those pay walls,

make it easier for consumers

to accept that, look, that is

the way that they have to pay

for content? I think paying

for content makes a lot of

sense. I find the notion of

giving it all away for free

highly resistible. Just

finally I wanted to ask you

about the takeover for consolidated media holdings.

James Packer has said he

thinks the price is fair.

What about Kerry Stokes, have

you heard from him at all,

have you been in talks with

him? No, I delivered the

offer to the Consolidated

offer to the Consolidated

Media Holdings board last

night. They had a board

meeting today. I've had a

very busy day, I haven't had

an opportunity to speak with

Mr Stokes. I speak with Mr

Stokes from time to time. He

is a person for whom I have a

very well-developed respect.

I would hope he'd see our

offer as being a full and

fair one. Why does it make

such sense for News Limited

to purchase Consolidated

Media? Well, we obviously Media? Well, we obviously

already have share holdings

in Foxtel and in Fox Sports. It increases our economic

interest in Fox Sports from

50% to 100%; it increases our economic interest in Foxtel

from 25% to 50%. We are

increasing our stakes in

those businesses because it

makes sense for us to

rebalance our revenues in

Australia, to concentrate in

terms of being an excellent provisioner

provisioner of news and other

content products inside the

general platform space of

mobile, and so on, and makes

sense for us to develop our

broadcasting assets. News

Corp is a great broadcaster

all around the world. Kim

Williams, thank you so much

for speaking with us today.

Pleasure. Kim Williams, CEO

of News Limited, also the chairman of Sky News Australia, talking there Australia, talking there to

our business correspondent,

bridy Barry. We're going to

take a very quick break and

then come back for reaction

to that and the rest of the

day's politics with our panel. Stay with us.

You're watching PM Agenda.

We're rejoined by our

We're rejoined by our panel,

Tony Wright from the 'Age',

Michael Farr from News We've heard Kim Williams defending the announcement today about the

future of News Limited, there

will be redundancies, he was adamant not putting a number

on it, saying they don't know

and it would be reckless to

put a number on it. Beyond

that, Tony, he had a crack at

Fairfax, contrasting today's

announcement to the

announcement we saw from

Fairfax on Monday at

Fairfax on Monday at 1900 job

losses and the other changes

that were announced as well.

What did you think about that? You'd be surprised if

he didn't have a crack at

Fairfax, even though he

called it "that other

organisation". Essentially

what he was saying was very

similar to what Fairfax said

the other day, that is, that

the landscape has changed,

changes have to be made,

digital comes pretty much

digital comes pretty much first, print will continue

for the foreseeable

future. It ain't dead yet.

All of those things are precisely the same in

Fairfax. What he did was

leave the elephant sitting in

the corner, and that is the

great uncertainty of how many

job losses this is going to

involve. Of course he gave

many elegant reasons why he

couldn't say how many that

would be, but at

would be, but at Fairfax,

though we may hate it, loathe

it and fear it, 1900 jobs to

go over the next three years,

at least that is known, it's

known to us and it's known to

the market. I think this is

something that Kim Williams

has made very sure he hasn't

addressed for fear that he could upset his own

could upset his own troops,

but also so that he'd have a

point of difference with

Fairfax. Just before we leave

this topic, clearly from

Stephen Conroy and from Kim

Williams, patch-up in

relations between the

Government and News Limited,

is this significant? Well, I

guess so. We don't know the

extent of it. But certainly

Kim Williams is relatively

new to the job. He's

new to the job. He's made

contact with certain

Government members. He has a

completely different - not

completely different, but he

certainly has a distinctive

style which is not like John

Hartigan's, his predesaysor,

for many years CEO of News

Limited. One could expect

there will be a little hoony

moonish rapprochement between

the two. One can also expect

if something happens that

affects the commercialability

of News Limited, that ra

proechment will rapidly dis integrate. They also speak

the same lot sort of

language. Kim Williams is an

online, new-tech kind of guy,

just as Senator Conroy is,

and John Hartigan was a

newspaper guy and the

abrasiveness was pretty obvious over the years. I obvious over the years. I

want to get your thoughts on

another big story today, a

High Court decision which has

ruled to be constitutionally

invalid the Federal Government's school

chaplaincy program, set up by

the Howard Government back in 2007, continued by the Labor

Government. It funds,

partially at least, chaplains

in schools, but it hasn't

been knocked out on secular been knocked out on secular church-state issues, it's knocked out because - perhaps

you can explain this -

Federal Government, in this

case at least, shouldn't be directly funding State Government responsibilities.

Now, Nicola Roxon, the

Attorney-General, says it doesn't have wider implications, about but it might. Essentially the High

Court said that

constitutionally you can't fund outside organisations

and this chaplaincy that we're talking about we're talking about was

actually a sub contracted organisation, without

legislation. And some constitutional lawyers have

jumped in and said this is

the biggest decision ever all

of this year, or whatever,

and it could affect all the

other funding arrangement s

that the Commonwealth

Government has that don't have legislation covering

them. Well, I would have

thought it would be relatively sensible relatively sensible for the Government to just cover them

with legislation. I'm pretty

sure the Opposition would go

along with it -- Of course

they would? -- if they were

going to become a Government

down the track, they don't

want to be left in this

position either. I think it

came as a bit of a shock -- I

think so stoo. The Federal

Government for years has

steadily been encroaching on State Government turf in a

whole range of areas. Will

this make a difference to that? Certainly the Attorney-General didn't think

it would, whilst

acknowledging she said she

hadn't read the 200-page, and

also the fact there were quite significant large

variety of opinions among the

judges. But she said don't

worry, we'll fix this up, and

there was a brief moment for

atheists and rationalists,

they were head over heals,

they thought this was

wonderful, but they'll wonderful, but they'll be

disappointed, this funding is

going to return and the

chaplains will stay. Just

finally, Julian Assange

seeking asylum with Ecuador,

he's holed up in the embassy,

Ecuador embassy in London.

This is one of the more

peculiar things we've seen

for a very long time, isn't it? Particularly as I don't

think freedom of the press in

Ecuador and freedom of

information -- Yes, but it

was a WikiLeaks leak that was a WikiLeaks leak that got

the US Ambassador kicked out

of Ecuador some years ago and

perhaps WikiLeaks thinks it's

owed a favour by the

President. I don't think the

Ecuadoran gratitude would

extend to Julian Assange

releasing all the secret

documents of that country,

but it is weird. It's just

very strange. And the idea

that somehow or other the

Australian Government can

come in and somehow rescue at

this point just seems to be

totally over the top. The British courts have said that

it's perfectly fine for him

to go off and face these

charges in Sweden and he

doesn't want to, so he's gone

to the Ecuadoran Embassy. On

that note, we have to leave

it there, good to talk to you

both. Thanks for that.

After the break, we'll replay

some of the interview with

Stephen Conroy, Communications Minister, on

the big changes in the media landscape this week.

For more now on the changes we've seen in

we've seen in the media

landscape this week, the

Fairfax job cuts and today's

announcement from News

Limited chief Kim Williams, I

spoke a little earlier this

afternoon to Communications

Minister Stephen Conroy. I

think, again, as we've talked

about earlier this week, what

you're sighing here is that

the digital economy is becoming the real economy and

you're seeing the sorts of

changes that Kim Williams has

put in place today as recognising that past

business practices won't be sustainable into the future.

So I think the strategy that

has been put in place today

recognises that if there

isn't change, significant change, within News Limited, the future would have been

much bleaker. So I think the

sorts of structural changes,

the new investment, the

retraining announcements are

all very positive and it was

pleasing to see. I'm sure

there will be some job

losses, which will be, again,

a very difficult week for

some people inside News

Limited, as it has been a

difficult week for the

Fairfax employees. Just on

those job losses for

starters, News is collapsing

the number of news divisions.

There will be an unknown

number of redundancies. Kim

Williams didn't put a figure

on it today. This will mean

fewer journalists, though,

presumably and editorial

staff. Is that a good thing

or a bad thing as far as the Government is

concerned? Well, -- Even news

journalists, the Government

has been critical of. I've

had my differences in the past with News Limited and

still occasionally do have some differences. But to go

to the core of the issue,

losing journalists from this profession is a bad thing for

democracy. Diversity of

opinion, diversity of voice,

is the lifeblood of

democracy. So seeing such

pressure on journalists - you

yourself work in a 24/7 media

cycle. You turned up on

Saturday night at 11.30

# Midnight to do an

interview. It never stops,

it's a relentless industry.

The digital age has slammed

into it this week and

demonstrated the digital

stage is here to stay, not a

passing fad. Should Kim

Williams put a number on the

redundancies? There will be concern across the company

about job cuts. Should there

have been a number or rough

ballpark today? The strategy of the announcement is

entirely up to the company.

I know people will be

concerned. Large numbers

have been speculated about,

nothing like the size at

Fairfax, but numbers have been mentioned. It is ultimately the decision of

the company how they want to

handle this. They've said to

me that they're going to be

retraining many, many people.

This is a very positive sign.

To take people from the old

era, the print era, into the new digital age I think is a very positive thing. News

Limited should be

congratulated on that. Let's

go to the acquisition side of today's announcement. News Limited wants to buy

Consolidated Media, which

will give it 100% own irship

of Fox Sports and a #r50%

stake in Foxtel, up from the

current 25% stake in Foxtel.

Do you sp there will be regulatory issues with

this? I think there are two areas where regulatory

agencies will be involved,

the first FIRB rr, News Limited foreign company at

the end of the day, there is

an issue you with FIRB.

There is a competition issue,

tough ruler over the merger

between Foxtel and Austar,

but ultimately it passed.

Given the way that the

company works at the moment,

given that News Limited

effectively manage the

company, providing there are no massive changes being suggested in the governance

behind the scenes, I can't see there being effective

change in the way that Foxtel

will operate. So I've looked

at this and we're seeing that

there are FIRB and ACCC

issues, but it won't make any effective change at all, from what we've been told so far. It concentrates the

number of owners in the media

landscape a bit further,

though. If News has a 50%

stake in Foxtel, it means,

for example, James Packer no

longer has any media stake,

apart from his smaller

shareholding in Ten. Is that

an issue, the concentration

of media ownership? That's

why we were talking about

journalists before and

wanting to have diversity of

journalists and proper

mentoring and training. You

have been through a process I

don't know in today's 24/7

environment you'd be able to

give to new journalists

coming along when dragged in

from home at 11.30 on a

Saturday night. This sort of relentlessness is putting enormous pressure, having to post immediately. These are

the sorts of things that are

really concerning. We're

seeing new models being

tried, people are going

behind pay walls, there's

different versions of pay

walls. It will be

interesting to see which of

those is successful and those

not successful. In terms of

a change from James Packer to

News, personally, there's not

going to be any effective

change in the way the company

is run. Stephen Conroy, the

xhooun kaikss Minister,

talking to us a little

earlier and significantly

saying there that he has had

a look at News Limited

expanding its reach in terms

of buying up more of Foxtel

and doesn't seem to have a

concern about that. It still

will need approval from the

foreign investment review board, because News Limited

is ultimately owned by News Corporation, a foreign

company, and also the ACCC,

the competition watchdog, but

the Minister doesn't a seem

to have too many issues with

that. That's all we have

time for this afternoon.

Thanks for your company.

We'll be back right after the

break with the latest Sky

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