Outdated Media Laws strangling business | radioinfo

Outdated Media Laws strangling business

Tuesday 05 May, 2015
Current Laws go back to when Paul Keating was PM. Photo: Keating.org.au

Comment from Peter Saxon

Media assets have never been cheaper according to Channel Nine chief, David  Gyngell which gives him added impetus to acquire  Southern Cross Austereo. He’s been trying for the past two years but has, so far, been stymied by Australia’s antiquated media cross ownership rules.

Speaking to The Australian, Mr Gyngell stated that he liked radio’s defensive characteristics, noting it had escaped the downdraft in the media sector brought on by a weak advertising market and the internet’s fragmentation of audiences.

“Everyone has been calling the death of that, but it continues to find growth,” he said.

High praise, indeed, from one of the nation’s top media barons. Yet, make no mistake, Mr Gyngell’s eyes are firmly on SCA’s television assets. If Nine were able to get hold of those and supplant their programming for the underperforming Ten’s, everyone would make out like bandits - except for Ten, of course.

So, what’s stopping this marriage from going ahead? Laws, dating back to last century, that prevent a television owner from reaching more than 75% of the potential national audience - which Nine would breach if the marriage were consummated.

Another offshoot of that law, enacted under the Keating government in 1992, prevents any one entity from owning more than two radio stations in any one market. This rule is impacting on the orderly divorce of 2CH from the newly merged Macquarie Radio Network. With the new entity now owning 2GB, 2UE and 2CH in Sydney, one of them must be sold to comply.

Compelled to put CH on the market, happily for MRN, the ACMA have granted them an extra year to find a suitable buyer thus staving off a potential fire sale.

That extra year also gives MRN the hope that media ownership laws might change in the interim which, in turn, would give them the choice to keep 2CH for themselves if they can’t get the price they want. After all, 2CH with it’s low cost base returns a modest but steady profit each year. Enhanced by the wholly owned Magic branded stations in Melbourne and Brisbane, 2CH completes a tidy eastern seaboard network which could be a nice little earner for its owners if they could keep it.

Clearly the Media Ownership Rules, enacted a quarter of a century ago, are past their use by date. But the current government is showing little urgency to reform and reaching consensus between all major media groups is as far away as ever.

What brought about the rules in the first place?

In a speech to the Sydney Institute - a conservative think tank - in June 2000, four years after he’d left office, the former PM, Paul Keating spoke of the need for the rules his government introduced: “The last Labor Government’s policy approach to the need to prevent concentration and encourage diversity was the cross-media rules. These limit owners broadly to either print or radio or television. Princes of Print or Queens of the Screen.”

His intentions were noble enough, but he had profoundly underestimated how online would impact the media landscape in 15 years time: “The question now is whether digital technology, which enables all forms of content to be delivered in similar ways, makes these rules out of date. I think this argument is greatly over-stated by the (Howard) government and the existing media owners.”

Tell that to Fairfax today.

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