When the Broadcasting Services Amendment (Media Ownership) Bill 2002 had its Second Reading in Parliament this week, various Senators spoke on the bill, which has now been held over until a session later in the year (see earlier story). This item surveys some of the debate, including comments from independents, government Senators and opposition Labor Senators.

INDEPENDENTS

One Nation Senator HARRIS from Queensland outlined his views on the bill, specifically quoting from a submission by Regional Radio broadcasters and also detailing his understanding of the UK media bill:

… The issues relating to cross-media ownership and the laws
that govern it have in the past led to heated public
and political debate…

If we look at Telstra’s influence in our
media industry—and this is one entity that, to a large
degree, tends to be overlooked in respect of the importance
of their place in the market—Telstra owns
50 per cent of Foxtel. Telstra also owns 100 per cent
of BigPond, and there is an alliance between BigPond
and ninemsn. So there is this interactivity between
the players in the marketplace.

Apart from those entities, we have the two government
run TV and radio outlets—that is, the Australian
Broadcasting Corporation and the Special
Broadcasting Service, SBS. The only significant media
company not in the grip of PBL or Murdoch is
Fairfax Holdings…

So why did we need to maintain restrictions on
media ownership in the past? They were necessary to
ensure that Australians had access to a choice of
voices and opinions. It was critical that there was
diversity in what was available for us to read, hear or
see in the media.

Many Australians share the view
that the present concentration of media ownership is
already too high and some propose that it should be
further restricted. I believe that there is another aspect
that is more important than the diversity of ownership,
and that is the diversity of content… Are we really interested in the
ownership of these entities, or are we to focus on
what I believe is the real issue, and that is the content
in our newspapers and on our radios and pay TV?

The concern is for plurality: we need to focus on the
diversity of the content that comes out of these media
entities.

Australia introduced cross-media rules in 1987.
Rules restricting cross-media ownership also exist in
other countries. However, in 1986 both the UK and
the United States made substantive changes to their
cross-media laws which resulted in less diversity and
a greater concentration of ownership. It would appear
that the government is also looking at similar proposals.

Rapid advances in communications technology in
recent years have seen technical conversion of separate
forms of the media. This conversion also makes
it desirable for major players in the media industry to
implement a strategy that ensures they have relative
interests across the various forms of the media. There
is an increasing trend for players in the media industry
to develop and invest in multimedia integration.

In addition, the globalisation of telecommunications
has seen a move towards the establishment of global
media empires… While there are no media specific regulations of foreign
investment in radio and newspapers, television
ownership is far more restricted.

I believe centralisation of services would ultimately
lead to loss of employment—and we are not
talking just about rural or regional areas; this would
happen in the major city areas as well. The other
danger is the loss of local content that would come as
a result of that centralising of services.

There is an interesting way in which the United States radio broadcasting industry has addressed this issue and
that is as a licence condition. The licensee is required
to provide to the broadcasting commission evidence
of how it has raised funds for local entities within the
footprint of its broadcasting area. Requiring that as a
licence condition means that that radio station needs
to maintain direct contact within the area that it
broadcasts through. I believe that if the industry does
require centralising of services for economic benefit
then that would be one way within Australia that we
could guarantee that we would retain local content
and local contact with those entities.

Other issues have been raised by other players in
the media industry. The Australian Association of
Independent Regional Radio Broadcasters in a letter
to me and, I would assume, all other senators state:
The members of this association, comprising 53 regional
commercial radio services spread over States, the ACT and
the Northern Territory, are strongly opposed to any relaxation
of the cross-media ownership restrictions which currently
apply in regional areas.

They go on to say:

While it might be argued that the government’s new proposals
for cross-media ownership in regional areas are an
improvement on its earlier proposals, they still fail to offer
any improvement over the existing regime. Instead, they
pose a threat to the public interest and to private interests
of small, independent media such as are represented by our
members.

The procedures set out in the Bill with a view to preserving
editorial separation and independence are a tacit admission
of the risks which are inherent in any relaxation of the
cross-media ownership restrictions, and the complexity of
those procedures raises serious questions about their efficacy.

So there has been a diverse number of entities
throughout the industry who have raised issues in
relation to the legislation. When looking at the controls
and regulations, particularly if they are to remain
with the ACCC, they need to look at the actual
impacts of mergers not just in one sector but in relation
to the ability to influence or compound decentralisation
in other sectors of the media.

I would like to briefly speak about the communication
bill that is now before the United Kingdom’s
upper house. The bill itself has 399 sections plus 19
schedules. It comprises 559 pages of legislation that
will bring together the legislation that at present is
contained in about eight different acts. If it is passed
in this form, the legislation will bring into existence a
new government department called the office of
communications. I believe that is where the improvement
lies in the proposed English model—not
the model that is there now but what they are proposing.
They are proposing to bring the entire media,
telecommunications and their gambling industry under
one entity, one piece of legislation, administered
and overseen by that department. I believe that would
be an improvement.

Independent Senator MURPHY from Tasmania highlighted the role of radio and pay tv in his view of the media bill changes, saying:

The purpose of the bill is to amend the Broad-casting
Services Act to remove controls on foreign
ownership of television—both for free-to-air and pay
TV—and newspapers, to provide for exemptions to
the cross-media rules in certain circumstances, and,
with some of the suggested changes, try and maintain
media services, particularly newspapers and radio in
rural or regional areas, by applying a two-out-of-three
ownership requirement…

I have serious concerns that the bill, if allowed to
pass in its current form, along with some amendments
that the government has proposed, would not
in any respect seek to achieve the objects as set out in
the Broadcasting Services Act. We have to very seriously
consider what we are proposing to do with regard
to this piece of legislation.

The potential for a
further significant concentration of media ownership
in this country worries me deeply. I am not going to
entertain that proposition…

One of the issues that I have concerns about is
that, if we see a further concentration of ownership,
we stand to lose diversity, services, jobs and plurality
of ownership, which really goes without saying. I
have had some discussions with the government,
which I am grateful for, about some of the concerns I
have had. We are continuing to discuss those, but I
make it very clear that they are very serious concerns…

If we look at what
has happened elsewhere in the world with the growth
in pay television and its capacity to have influence
within the media market, we see that in the UK it is
around 41 per cent. It is estimated that it will be
about 42½ per cent by the end of this year and that it
will grow to 55 per cent during the course of the next
10 years. There is regulation of pay TV in the UK
and it falls under the Office of Fair Trading.
But I believe that here, because of the circumstances
particularly as to the players involved, we
have to look at how we can manage a program where
we will just not see one of the two major players now
in the media game in this country…

I believe there is a public interest
in looking at the current media laws with a view
to changing them to actually seek out the objectives
of the Broadcasting Services Act. We have had some
discussion about how that might occur. I have the
view that pay TV should be included in the mix. I
also have a view as to the minimum number of commercial
voices…

If you take account of including pay
TV in the mix and if you then have a regulation that
says no single media owner could own more than two
of four mediums, there would be six minimum commercial
voices in the marketplace. That would exclude
a newspaper that would fall outside the Broadcasting
Services Act definition of a newspaper.

Radio and smaller newspapers are of particular
importance to regional areas of this country. We have
the concentration rules that remain in place essentially
as they are, even if you pass the bill as it currently
stands—that is, there will continue to be a requirement
for there to be three separately owned TV
networks. But that does not mean that you will continue
to have three TV networks, because in the
world of competition, as has been the UK experience,
if some TV networks get significantly stronger than
others, the others wither and die; the question of
ownership becomes irrelevant. So it is important, as I
said at the outset, that whatever we do here is right…

What is the public interest if we allow News, Murdoch
or Packer to consolidate significant assets in
Australia? Where is the public interest in that? It is
difficult for me to see it.

But I think there is a public
interest in the changing nature of media delivery, in
the technology associated with media, in the laws that
govern it and in the new laws that will enable the
delivery of better services, more services and more
diverse services. That is important from the point of
view of the public and I think this is a very important
piece of public policy legislation. I will continue to
try and work through the issues. I believe that it may
be possible to get to a point where agreement can be
reached in regard to legislation that will work towards
the objectives of the Broadcasting Services
Act…

Independent Senator HARRADINE from Tasmania reserved his opinion on how he would vote, saying:

The… Bill would change the regulation of
a particularly complex area of legislation. It would
change the boundaries we place on Australian media,
and specifically television, radio and newspapers. I
have found the questions involved in thinking
through this legislation particularly challenging.

I acknowledge that I have been assisted by the Senate
processes, submissions made to the committee and
the committee’s report. I also want to place on record
my thanks to the delegations that have made representations
to me both for and against the bill…

Other senators in this place have similar views to
mine on the general outcomes we want from this
legislation. I think it would be fair to say that many
of us would like to have a simpler and clearer system
of regulation which would prevent further media
concentration but allow the media industry to expand
for the benefit of the general community. Achieving
legislation which meets those objectives is the difficult
part.

When considering this bill there is a very important
question to be asked. It is one that was posed by
the Communications Law Centre: what does this bill
do to benefit the Australian public?

I recognise that it
is generally in the commercial interest of media companies
to expand, but is it generally in the public interest?

I come to this debate with a particular aim in
mind and that is to ensure that we have an equitable
system of media regulation which enhances the diversity
of news services by both protecting against a
concentration of resources in fewer hands and ensuring
that the market is more open so that new providers
can enter and provide other voices. My particular
focus is on news because I see the provision of news
services as the most important function of media organisations.

I am particularly concerned about how this legislation
will impact on my own state—Tasmania. Media
organisations are central components of local
communities around Australia…

Because of the important role media organisations
play in public debate and in our daily lives, owning a
media company is a significant privilege which
comes with significant obligations to the community… Those who own or run media organisations are
in a position of privilege and influence. They are
members of an unelected elite which is not effectively
accountable to the Australian people. It is our
job as elected legislators to ensure not only that there
are reasonable parameters set for the running of successful
media businesses but, much more importantly,
that these parameters serve the Australian people.

I have a number of concerns with the bill as it
stands. These include the likelihood of a further concentration
of media ownership resulting from the
legislation, particularly mergers of large media
groups; the delegation of decisions on cross-media
ownership to a regulatory body… and the
lack of cross-media ownership restrictions for other
media such as pay TV and Internet based media.

It seems to me that under this bill a number of the
largest media organisations in Australia would be
able to merge and establish substantial cross-media
companies. I cannot see how such mergers would be
in the public interest when the largest media organisations
already have a very large reach in Australia…

To protect the public interest we need to ensure
there is a diversity of media views in local and national
markets, and to protect that diversity we need a
diversity of owners. I take my thoughts on this point
from the Productivity Commission. That commission
is best known for its free-market views, so some may
be surprised that in its broadcasting inquiry report it
takes a bit of a different tack on media ownership.

The Productivity Commission found that ‘the likelihood
that a proprietor’s business and editorial interests
will influence the content and opinion of their
media outlets is of major significance’ and there is ‘a
strong preference for more media proprietors rather
than fewer’. The report concluded that ownership
does matter…

This is not to say that the current legislative
framework is without problem. Under the current
arrangements, newspaper groups are increasingly
sharing resources between their masthead papers. I
saw the other day that the wrong masthead was in a
particular newspaper—we know what paper it was; it
has a number of papers throughout the country. It had
the masthead of the originator paper and not of the
receiver of the general information.

Under the current arrangements, newspaper groups
are increasingly sharing resources between their
masthead papers while radio stations in some regions
are taking syndicated programming. Media organisations
may be restricted in owning too big a slice of
media operations in particular markets or licence areas,
but in some cases they have a very big reach
across Australia as a whole.

I would like to be able to
support an equitable new approach to regulating the
Australian media to fix up some of the problems that
have emerged under the current system. I would like
to support a system that would allow the Australian
media to expand their businesses, without reducing
what I consider to be the vital factor of diversity of
ownership.

One part of this bill which has not had as much
attention as the regulatory mechanisms for media
ownership is the foreign ownership issue. I must say
that I am not very comfortable with reducing foreign
ownership restrictions.

Australian media is a very
important cultural commodity and I would be concerned
to see further foreign ownership of organisations
which are so central to the depiction, support
and development of Australian culture. However, my
decision on this issue depends very much on how I
respond to the cross-media ownership aspect of the
bill.

These two aspects of the bill could have very
different effects if they are accepted by themselves or
as a package. I would like to consider further the
question of the foreign ownership aspect of the legislation
when I have come closer to a final position
on the cross-media laws.

A range of amendments and alternative proposals
have been circulated in the Senate over the past
month. Though many of these have very good and
attractive aspects, I am yet to be fully convinced by
any of the various regulatory schemes that have been
floated. I am also not aware of the government’s position
on some of the proposals that have been put
forward. I imagine that the communications minister,
Senator Alston, will use his second reading speech to
put forward the government’s position on these and
to detail any proposal that the government may have
for amendments. I will consider this new information
before deciding how I vote.

OPPOSITION

Labor Senator LUNDY from the Australian Capital Territory spoke against the Bill saying:

Labor [is] opposing the … Bill which the coalition
has brought forward to vary the media ownership
laws of this country. We do so knowing that this bill
would only further concentrate media ownership in
this country, thereby bringing about less diversity and
a far lower quality of media content available to
Australians.

There are a couple of points I would like to take
the opportunity to make today. The first is the issue
of localism and its impact on urban or regional areas.

There is a growing clamour around the world as regions
really yearn to see themselves reflected in both
creative content and current affairs content in their
news bulletins and their comedy shows. People need
to see themselves reflected: it helps our culture develop
and it helps us take a healthy attitude towards
how people not only see themselves but relate to
other cultures. More than anything else what we are
observing is a growing demand for local content produced
and seen by the audiences in those regions…

This issue was the focus of many of the
submissions to the Senate inquiry on this bill. Many
of those making submissions—in fact, all of the
smaller independent broadcasters, radio stations, suppliers
of local content—argued vehemently that they
felt they would become far more vulnerable to takeover
or consolidation or, in fact, going broke if this
bill passed, thereby reducing that diversity in their
particular community. These issues played a significant
role in forming our view, but there were many
other issues…

This issue is I think coming to haunt the Minister
for Communications, Information Technology and
the Arts and the coalition on a consistent basis. We
have a legacy of cross-media ownership and media
policy that has gone from bad to worse under the
coalition. Clearly the coalition has been unable to
grasp the implications of convergence and learn the
lessons in the international market of pay TV, digitisation
and terrestrial television as well as the opportunities
that exist with datacasting and interactive
content as a means by which we increase diversity.

Every step of the way the government has effectively
locked down behind incumbent media companies in
this country and created a regime that preserves their
interests in the existing market… Labor’s analysis shows that this bill
will create an environment for further consolidation
of content and media ownership in this country. In
drawing that analysis, we have been informed by
many organisations and individuals who made submissions
to this inquiry—indeed, the first-hand testimony
of some of the smaller independent producers
of content, the media organisations—who feel that
this bill would make them extremely vulnerable.

I would like to conclude by saying that I understand
we are now in a situation where this debate will
be adjourned following the second reading. I presume
that will give Senator Alston the opportunity to try
and woo the votes necessary to salvage something
from this bill. But we will conclude on the note that
Labor think this bill does not have a future, and we
will certainly be expressing that view by voting
against the second reading. We will be very interested
to watch how the government tries to salvage something
of it.

Labor Senator McLUCAS from Queensland said:

In speaking to the… Bill, I want to confine my
comments to the potential impact of the legislation on
regional media markets and the resultant effect on
those regional communities.

But in doing so, I need
to outline the reasons that Labor has for not supporting
this legislation. In my view, this legislation is not
about regulating cross-media ownership; it is about
abandoning government involvement in media regulation.

Professor Fels, Chairman of the Australian Competition and
Consumer Commission, has said repeatedly that, for
the purposes of the Trade Practices Act, newspapers, television and radio are separate markets. According to Professor Fels, the ACCC would not be alarmed at
the notion of a television owner, for example, taking
over a local newspaper. If this bill were to be carried,
we would see our media environment, which currently
consists of six or seven major commercial
players, contract to three. Most commentators suggest
that these operators would be based around the
current three commercial television licences, and media
diversity would effectively be halved.

The bill repeals cross-media ownership restrictions
in major metropolitan markets. It allows an individual
to control a major newspaper, television station
and radio station in that same metropolitan market,
provided they obtain cross-media ownership exemption
certificates from the ABA. These certificates will
be granted if the holder of the certificate can demonstrate
separate editorial policies, appropriate organisational
charts and separate editorial news management,
news compilation processes, and news gathering
and interpretation capabilities. These so-called
editorial separation provisions, I believe, are simply a
bureaucratic construct that provides no comfort for
the community that true editorial separation could or
would occur.

In the committee’s report to the Senate, govern-ment
senators recommended that a version of cross-media
ownership be retained in regional areas. They
recommended that cross-media ownership in regional
areas be limited to no more than two of the three media
of television, radio and print. This recommendation
has been picked up by the government in respect
of regional media markets. The legislation allows
media companies to own two out of three of either
television, newspapers or radio stations in regional
licence areas.

By doing so, the government is recognising
that the principles of editorial separation will
not be an effective policy in regional areas…

I want to take the opportunity to advise the Senate
of what occurred in North Queensland when Southern
Cross Broadcasting ceased to broadcast its half-hour
weeknight news service in the subregions of
Townsville and Cairns, amongst other places in Australia… The loss of these two newsrooms resulted
in the immediate loss of 20 jobs in Townsville and 12
in Cairns; the loss of the only free-to-air locally produced
news service for the area previously serviced
by Seven Central, which sourced its news service
from Southern Cross Broadcasting; and the loss of
the only competitor to WIN news in the coastal region from the area from just south of Townsville to
the north of Cairns.

As a result of community pressure and
political pressure, the Australian Broadcasting
Authority established an inquiry into the impact of
the loss of Southern Cross Broadcasting in our region…
The Australian Broadcasting Authority responded
to the range of submissions … and has recommended
the introduction of an additional licence condition
that requires a minimum level of local content… These recommendations are not yet in effect,
but, given the changed behaviour of the current licensee
in the market in producing an increasingly amalgamated
news service, it will be interesting—and we
will monitor this—to see how the ABA intends to
monitor compliance with the new licence conditions…

My reason for raising this case study is to under-line
the need for competition to be maintained in any
market, but especially a regional market, to ensure
that diversity of views can be delivered to a community… This legislation is not good public
policy… I encourage all senators to defeat
this legislation …

GOVERNMENT

Liberal Senator EGGLESTON from Western Australia, who was Chair of the Committee that enquired into the bill, supported it, saying:

… In the light of all the evidence put before it, the government
members of the committee came to the view
that the actual impact of the changes proposed in the
bill to the regulation of cross-media ownership will
not be great given the likelihood that around 90 per
cent of Australians will continue to have access to
three commercial television channels plus the national
broadcasters. Also, there will continue to be a
diversity of press and radio…

The most important change will be to allow foreign
investment in the Australian media industry. The
government members of the committee were persuaded
of the benefits that would result from lifting
restrictions on foreign ownership for media companies,
advertisers and consumers, bearing in mind that
foreign investment in the media will still be regulated
under the Foreign Acquisitions and Takeovers Act
1975 and Australia’s general foreign investment policy.

The repeal of restrictions on foreign investment
will, in the view of the committee, provide opportunities
for access to global capital, resources and expertise
for Australian companies, as well as possibilities
for Australian expertise to be promoted and
advanced internationally.

As for fears that an increase in foreign ownership
will lead to less local content, it is important to bear
in mind that Australian audiences have been shown
consistently to have a marked preference for locally
produced programs. One could therefore say that
there is a commercial imperative for broadcasters to
include Australian content in their programming. In
relation to that, it is crucial to note that this bill will
in no way alter the existing Australian content rules…

Schedule 2 of the bill relates to the cross-media rules. The bill does not
abolish the cross-media rules but instead proposes the
granting of exemption certificates, subject to the application
of a public interest test administered by the
Australian Broadcasting Authority. The government
members of the committee came to the conclusion
that reforming cross-media ownership in this manner
will permit the generation of synergies, allowing for a
more efficient media industry with enhanced economies
of scale which will ensure better quality and
more diversity of content for consumers.

An issue raised in this debate, in particular by
Senator Lees, is the question of a broad based public
interest test… The government
members concluded that the public interest is protected
by the editorial separation requirements administered
by the Australian Broadcasting Authority,
the preservation of the concentration rules and the
retention of the rules regarding Australian content
and that a broad, media specific public interest test is
therefore not required.

The A.T. Kearney study into media ownership restrictions
in Australia found that, even in the extreme
case of consolidation of ownership into a single company
of the dominant newspaper, television and radio
groups currently owned by News Limited, Publishing
and Broadcasting Limited—PBL—and Austereo, the
estimated relative influence of such a company, as
measured by the market share of national metropolitan
consumption of daily news would, when averaged,
be relatively unchanged.

Moreover, such a scenario
would see the maintenance of at least three
other major media groups, in addition to the national
broadcasters, and the percentage reach likely to be
achieved by the consolidated company would still be
less than the total of that achieved by all other companies.

From the Kearney study it is quite obvious
that these proposals are not going to result in a great
concentration and consolidation of Australian media
ownership.

However, the government members of the com-mittee
came to the view that it would further protect
the public interest if there were a requirement that a
commercial interest be disclosed in the context of any
article or editorial comment where co-ownership exists
under a cross-media exemption, when one co-owned
media outlet made editorial comment about
another in the same locality.

Senator McLucas has just raised the issue of the
regional media and its requirements. The government
members of the committee addressed the problems of
the regional media in their report and acknowledged
the special problems faced by regional media, in particular
their higher operating costs and lower revenue
base in comparison with their metropolitan counter-parts.

Regional media companies, for example, often
have to operate over large, sparsely populated areas.
On top of their higher operating costs, regional media
have to contend with lower advertising revenue than
metropolitan media.

In relation to cross-media holdings of regional
media and concerns that undue concentration of ownership
could occur in regional Australia, the government
members recommended that the bill be
amended so that cross-media exemptions in regional
markets could only be allowed in relation to proposals
that could result in a media company having
cross-ownership in only two of the three generic
categories of newspapers, radio and television in their
area…

Liberal Senator ALSTON, the Communications Minster from Victoria supported his bill, focussing on the economic rationale of allowing a freer media market and outlining existing companies approaches as he sees them:

I heard Senator Murphy’s contribution
on the … Bill and I thought he put his finger
on the critical issue that confronts the Senate—and
indeed anyone interested in debating these issues—
and that is to identify the public interest in these proposals.

In order to properly do that, you have to have
regard for the way in which the media has evolved in Australia in recent years and how it is evolving inter-nationally.

At the moment the media in Australia operates
within a legislative straitjacket. It was introduced in
1987 and, if anyone has followed the history of that
cross-media debate, they will know that it was conceived
in malice by the Prime Minister of the day,
who had very specific political objectives and it had
very little, if anything, to do with seeking to promote
diversity.

I thought Senator McLucas actually gave a
very good example of how the current straitjacket is
operating. She told us how Southern Cross had withdrawn
its television news services shortly after the
last election. Those who are following the game
would know that some six months earlier Prime Television
had done the same in a number of regional
markets.

You ask yourself: how is that happening? The first
thing to be said is that it is happening under the current
regime.

Why is it happening? It is happening
because the opportunities to expand are very constricted
by the current regime.

What we really want
in this country is a system that is sufficiently flexible
to encourage new investment, to attract new players
and to provide greater opportunities for the existing
players. It might be fashionable to think of two or
three major players, but in fact in this country you
have quite a significant number of different operators,
whether it is APN, Austereo, Village Roadshow, who
have significant interest in that company, or whether
it is Rural Press, Cumberland Press, News, PBL,
Channel 7, Channel 9, Channel 10, DMG, RG Capital—
the list goes on.

There are a very significant
number of media players in this country already.
If you compare it to a place like the UK, we have a
much healthier media regime.

In fact what they are
looking at in the UK at the moment, given that the
BBC has a bit under 50 per cent of the audience reach
in terms of terrestrial free-to-air, is a commercial
player, a single commercial operator, that is pretty
much on its knees and yet has the commercial sector
pretty much to itself. That is a very unhealthy out-come
of their approach.

Whereas in this country we have laws that of
course would remain in place that say you cannot
own more than one television station in a market, you
cannot own more than two radio stations in a market
and you cannot exceed the 75 per cent audience reach
limitation. That means by definition that you will
continue to have multiple players in all markets.

It
will vary from place to place. Obviously in some regional
areas you will have maybe only one commercial
radio station. Whereas in the larger capital cities
you will have maybe six or eight commercial players.

So it is hard to have a one-size-fits-all approach. But
you can have minimum guarantees put in place, and
that is what Senator Murphy was referring to when he
talked about the minimum number of voices, which is
the model the UK is in a process of adopting.

They are adopting that because they have decided
to discard their former—what we might call—media
specific public interest test, which they found was
overwhelmingly subjective. It had any number of
criteria, which left it up to the regulator of the day to
come to whatever decision it chose and then to rely
on any one of those criterion to justify the outcome.

I think they quite rightly said that that is not a trans-parent
regime; you have no certainty in advance; it is
largely a matter of whim. You are much better to look
at what you are trying to achieve to ensure that you
have a minimum number of voices in a market.

That is a country that has three times our population, but it
regards three plus the BBC as being a sufficient
number of voices in the market.
I think we can do a lot better in this country.

For a start, we have two national broadcasters. We should
also remember that you cannot force commercial
players to invest or expand.

It is always said: ‘We
haven’t got enough media proprietors. We haven’t
got enough newspapers. We should have more; we’ve
got less.’ None of that is within the control or gift of
government. If newspapers are not prospering, they
go to the wall. There is no way you can force someone
to set up a media company. But if you relax the
foreign ownership rules on print, for example, there
is every prospect that you might get a significant degree
of interest from a number of players.

One media proprietor from Spain has been looking
at this market for some years but will not come in
under a rule that says you cannot own more than 25
per cent. That is perfectly understandable.

If you are
making, in some instances, multibillion dollar investments,
the last thing you want is not to have full
control over your asset.

There is every prospect that
you will get companies like Pearson, which owns the
Financial Times and the Economist. You may well
get a number of companies from the US that would
have a much renewed interest in media activities in
this country. That in itself provides competition and
the prospect of new players.

So it is important to remember that what we might
want on the one hand and what is commercially
achievable on the other are determined very much by
the regime you put in place. That is why I thought
Senator McLucas’s example was a classic—because
these people have been withdrawing services because
they have nowhere else to go.

They cannot expand
their businesses because of the constraints of cross-media
ownership rules, so what do they do? They
focus on cost cutting. Cost cutting is not a sign of an
industry that is prospering; it is a sign of an industry
in decline.

That is why public interest is critically
important in introducing flexibility into the system, in
enabling new players to enter and in enabling existing
players to expand their operations. That is all
within the context of the objects of the Broadcasting
Services Act. That remains the governing charter at
all times.

I think it is also fair to say that some people have
talked about pay television having an increasing influence
on the shape of the media landscape. But the
first point to make is that pay television is over-whelmingly
an entertainment medium. However, in
this country, where Foxtel is effectively providing
services as an operator to telecoms and other carriers,
there are some six news channels. That in itself is a

sign of great diversity.

We did not have any of that in
1987 when these rules were introduced. So ask your-self:
do we want to constrict that? Do we want to
somehow say that if you own a television station and
a stake in a pay TV channel you cannot go any further?
That would take out most of the major players
in this country. Take Channel 7, for example. It has a
one-third interest in Sky News, which is one of those
six I referred to. That is not a healthy outcome, because
you are treating pay TV as something that
ought to restrict expansion.

Cross media in its original form identified three
areas and said, ‘You can’t have cross holdings.’ The
idea of expanding it to include telecoms or magazines
or other things is clearly a retrograde step. However, I
think it is very important, as Senator Murphy put it,
to ensure that when public interest is addressed by the
regulators—and that includes the ACCC, because I
think there is a way of ensuring that the ACCC has
the jurisdiction to scrutinise any cross-media take-overs—
in the course of doing that they ought to have
regard for other media interests, be they magazines,
pay TV or, as Senator Harris said, the Internet.

The
Internet in all its manifestations is a moving game, as
we know. There are content providers, content carriers
and ISPs. All of those elements can and should be
taken into account by a competition regulator concerned
to ensure that there is not a significant reduction
in competition or a substantial lessening of competition.
That is why I think it is certainly feasible to
ensure that the ACCC has that jurisdiction—which at
the moment it does not really have.

If someone ap-proaches
it and asks it to make a judgment on a particular
activity then it gets involved, but it is pretty ad-hoc at the present time. I think there is certainly a
need for more certainty in that regard.
It is also important to remember that, when you are
trying to ensure that you have addressed these issues,
you focus on what is fundamentally important. It is
not the provision of more entertainment services. Senator Harris said it is diversity of content rather
than simply more ownership. I would be more specific
than that, although I agree with him as far as he
goes. It is all about news and current affairs, because
that is where the legitimate interest of the parliament
lies.

Governments and regulators have a very important
role to play in community standards, but apart
from censorship, and assuming reasonably whole-some
material, whether there are five soaps or 25
soaps, whether there are any number of channels
available on pay television—and in a digital environment
you could get anything up to 500 channels—
or whether you have 60 now or 250 in 12 months
time is a matter for the market. It is a matter for consumers.
The more they demand, the more, presumably,
they will be accommodated.

I think the parliament has a legitimate concern relating
to the public interest to ensure that there is diversity
of opinion. That means ensuring that all
voices and all different points of view can be heard,
whatever the issue of the day might be.

We certainly
have one before us right now. I am sure every citizen
in this democratic society wants to know that there is
no single stone unturned nor a single view unexplored that might be brought to bear in the debate. In
order to ensure that you have that diversity of opinion,
you need to remove any obstacles.

At the same
time, you need to protect those arrangements so that
you have minimum standards in place or, in some
instances, editorial separation and diversity to ensure
that there is no improper interference in that decision
making process, whether it is news selection, news
prioritising or news collection.

But the fact remains that, if you look at what has
happened since 1987, there has been a veritable explosion
of new sources of news. Whether I like it or
not, there are a lot of kids these days who do not go
to the front page of the newspaper for their news.
They go straight online. When they go into the office
or even before they leave home they will be surfing
the Internet. They will get their news from wherever
they want to get it. They will decide what news they
get and then they will access it. They might update
themselves a number of times during the day.

For
those who were brought up in a good old newspaper
world, this is hardly recognisable. You did not have
pay television, you did not have the Internet, SBS
was hardly rolled out and you did not have anything
like the number of services that the ABC now provides
to all parts of Australia. The quality and quantity
of opinion and, therefore, content has exploded
dramatically.

This bill provides a unique opportunity to modernise
the media arrangements. Some reference was
made to the Productivity Commission, but it is worth
remembering that, when the Productivity Commission
talked about an approach that involved subjectivity,
they were talking about the UK model which
the UK is now in the process of discarding.

A view of
the Productivity Commission in 2000 may well not
be the view of the Productivity Commission in 2003;
nor is it the view of many others around the world.

The reason that the US and the UK are doing what
they are doing in terms of overhauling their media
laws is precisely the same. It is not because they want
to constrict.

I heard what Senator Harris said about
the US in 1996: they allowed people to own more
radio and television stations in a market at a time
when they had a huge telecommunications bill—the
first one since 1994—but they also recognised that
you cannot artificially constrain without paying the
consequences. As long as you protect those legitimate
public interests, you are able to achieve all that
the objectives of the act require.

In terms of local content, again it is critically important
that we ensure that matters of local significance
are available in regional areas. You do that
through the point system that the ABA has already
identified. They are ultimately the only ones in a position
to make these judgments, because you have to
strike a balance between insisting on minimum standards
in the provision of news, current affairs and
local information in prime time but not making it so
onerous that players vacate the market.

Clearly, that
is not a task for government or for those who might
be debating a bill. It is the responsibility, cloaked in
law, of a regulator to conform with those requirements.
It is also necessary to have the legislation require the ABA to do that, not just as a matter of grace
and favour—and hope that they will express a view
that others will adhere to—but to actually insist upon
it.

For the first time, this bill provides minimum requirements
for matters of local significance and local
news in regional areas that simply have not been
there until now.

It is building on all those existing
arrangements: one to a market for television, two to a
market for radio, audience reach limits and now
minimum levels of local content. At the same time,
with the two out of three provision which you could
extend to metropolitan areas as well, you are providing
an additional safety net. If you add to that a
minimum number of voices, you are not looking at
wholesale change.

The real revolution would be to
simply discard cross-media and foreign ownership,
and leave it to the market. We are light years away
from that. That is not what this is all about. It is quite
the opposite. It is about giving exemptions in certain
defined situations. By doing it that way, you are able
to ensure that you get a very healthy outcome whilst
protecting the legitimate concerns that have been expressed
by a number of senators this evening.