Table Of ContentContent,
Consolidation
And Clout
How will regional Australia
be affected by media
ownership changes?
Tim Dwyer
Derek Wilding
Helen Wilson
Simon Curtis
A report by the Communications Law Centre 2006
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,
, ,
•
Content, Consolidation
And Clout
How will regional Australia be affected by
media ownership changes?
A report by the Communications Law Centre 2006
Funded by a Faculty Grant from the
University of New South Wales, 2005
Acknowledgements
The authors would like to thank all those in Wollongong, Launceston, Townsville and Toowoomba
who participated in the focus groups for this study, and the academics, commentators and journalists
who gave us their time and insights.
Special thanks go to: Elizabeth Beal, Philip Bell, Ginger Briggs, Lesley Hitchens, Jock Given, Julie
Hillocks, Geoff Lealand, Julie Miller, Nick Moustakas and Julian Thomas.
Analysis of media companies and a draft of some sections of Chapter Four were provided by Danny
Yap as part of a placement for the University of New South Wales Law School social justice internship
program.
The Faculty Research Grants Committees of the Faculty of Law and the Faculty of Arts and Social
Sciences at UNSW provided funding for the initial part of this project including the field work in
regional centres. The project was completed by the authors following the closure of the
Communications Law Centre at UNSW in June 2005. The CLC continues its policy, research and
advocacy work through its centre at Victoria University.
About the authors
Tim Dwyer is Lecturer in Media Policy and Research at the School of Communication Arts,
University of Western Sydney.
Derek Wilding was Director of the Communications Law Centre from 2000 to 2005. Before that he
worked for the Media, Entertainment and Arts Alliance and at Queensland University of Technology.
He is currently a Principal Policy Officer with the Office of Film and Literature Classification.
Helen Wilson is Adjunct Research Fellow with the Communications Law Centre. She was Associate
Professor in the School of Humanities, Media and Cultural Studies at Southern Cross University, and is
currently editor of Media International Australia incorporating Culture and Policy.
Simon Curtis was Clayton Utz Senior Research Officer at the Communications Law Centre from April
2004 to July 2005. He is currently a researcher at the Faculty of Law, UNSW, on a project examining
self-regulation in the communications sector.
Any views expressed in this report are those of the authors and not of the organisations for which they
work.
Communications Law Centre
The Communications Law Centre is an independent, non-profit, public interest organisation
specialising in media, communications and online law and policy. In Victoria, the Communications
Law Centre is a research unit of Victoria University.
Director: Elizabeth Beal
Level 1, 283 Queen Street Phone +61 (0)3 9600 3841
Melbourne VIC 3000 Fax +61 (0)3 9670 7902
PO Box 14428 Email [email protected]
Melbourne VIC 8001 Web www.comslaw.org.au
© Communications Law Centre Limited 2006
ABN 89 003 623 630
ISBN 1-875538-35-6
All rights reserved. Without limiting the rights under copyright preserved above, no part of this publication may be reproduced,
stored or introduced into a retrieval system, or transmitted, in any form or by any means (electronic, mechanical, photocopying,
recording or otherwise), without the prior written permission of the Communications Law Centre.
The cartoon on the front cover is by Reg Lynch
CONTENT, CONSOLIDATION AND CLOUT i
Contents
Acronyms & abbreviations iii
List of tables and figures iii
Executive summary v
Key findings xxiv
1 Introduction 1
1.1 Media ownership and regional Australia 3
1.2 Current media ownership 4
1.3 Outline of the report 9
2 Rationales and realities of Australian media ownership regulation 11
2.1 The rationales of media ownership regulation 12
2.1.1 Media influence 13
2.1.2 Content choice: the new diversity? 15
2.2 Continuity and change in Australian media ownership regulation 22
2.2.1 Media ownership regulation 1923-1986 22
2.2.2 Regulatory changes 1987-1988 25
2.3 Current media ownership laws 26
2.3.1 Cross-media and media concentration 26
2.3.2 Limits on foreign ownership 28
2.4 Convergence, competition and regulatory change 29
2.4.1 Revisiting the Productivity Commission’s Broadcasting Report 30
2.4.2 The Broadcasting Services (Media Ownership) Bill 2002 34
2.4.3 Increasing role of competition regulation 36
2.4.4 Proposals for deregulation 39
3 Media ownership, networking and local content provision 44
3.1 Equalisation and local content 45
3.2 ABA Investigations: Localism policies in regional TV 48
3.2.1 First ABA Report, August 2002 48
3.2.2 Second ABA Report, June 2004 53
3.3 Existing content sharing practices 54
3.4 Anticipated legislative reform and preserving local content 56
4 Media mergers and regional consequences 58
4.1 Introduction 58
4.1.1 Review of regional media ownership – methodology 59
4.2 Potential changes in ownership 63
4.2.1 Macquarie Bank 63
4.2.2 APN News and Media 63
4.2.3 Rural Press 64
4.2.4 Southern Cross Broadcasting 64
4.2.5 Prime Television 65
4.2.6 WIN Corporation 65
4.2.7 West Australian Newspapers 66
4.3 Impact on services in selected regional areas 66
4.3.1 Possible mergers 66
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ii CONTENT, CONSOLIDATION AND CLOUT
4.3.2 Effects on diversity 71
4.4 Impact on services in other regional markets in Australia 75
4.5 Conclusion 79
5 Case studies of regional media issues 82
5.1 Wollongong 83
5.1.1 Power and the city 83
5.1.2 Major media 86
5.1.3 Advertising and competition 96
5.1.4 Media ownership 97
5.1.5 Summary 98
5.2 Townsville 99
5.2.1 The Townsville Bulletin 100
5.2.2 Television 102
5.2.3 Radio 104
5.2.4 Summary 105
5.3 Launceston 105
5.3.1 The Examiner 107
5.3.2 Advertising 112
5.3.3 Television 113
5.3.4 Radio 114
5.3.5 Media ownership 115
5.3.6 Summary 115
5.4 Toowoomba 115
5.4.1 The Toowoomba Chronicle 117
5.4.2 Television 122
5.4.3 Radio 123
5.4.4 Media ownership 124
5.4.5 Summary 124
5.5 Observations and comments 125
6 International developments in ownership and content regulation: 128
New Zealand, the United Kingdom, Canada and the United States
6.1 New Zealand 129
6.2 United Kingdom 132
6.2.1 Broadcasting Act 1996 132
6.2.2 Communications Act of 2003 135
6.2.3 The Public Service Broadcasting Review 140
6.3 Canada 144
6.3.1 Legislative and regulatory framework 145
6.3.2 Media ownership consolidation 150
6.3.3 Canada’s approach to maintaining media diversity 151
6.4 United States 157
6.4.1 Legislative and regulatory framework 159
6.4.2 FCC order and Appeals Court response 160
6.5 Australia compared 162
7 Conclusion: content, consolidation and clout 165
References 172
Communications Law Centre 2006
CONTENT, CONSOLIDATION AND CLOUT iii
Acronyms and abbreviations
ABA Australian Broadcasting Authority
ABT Australian Broadcasting Tribunal
ACCC Australian Competition and Consumer Commission
ACMA Australian Communications and Media Authority
BDU Broadcasting Distribution Undertaking (Can)
BSA Broadcasting Services Act 1992 (Cth)
CBSC Canadian Broadcasting Standards Council
CROC Crown-Owned Company (NZ)
CRTC Canadian Radio-television and Telecommunications Commission
DCITA Department of Communications, Information Technology and the Arts
FATA Foreign Acquisitions and Takeovers Act 1975 (Cth)
FCC Federal Communications Commission (US)
FDU Forward Development Unit
(part of the former Department of Communications)
MCH Ministry for Culture and Heritage (NZ)
NZOA New Zealand On-Air
Ofcom Office of Communications (UK)
PC Productivity Commission
PSB Public Service Broadcasting (UK)
List of tables and figures
Tables
1. Percentage of national daily press circulation 5
2. Percentage of national television audience reach 5
3. Percentage of national radio audience reach 6
4. Regional media companies examined in this report 62
5. Impact of forecast mergers on markets in regional Australia 77
Figures
1. Companies with significant investments in metropolitan television and newspapers 7
2. Companies with significant investments in regional media 8
3. Current ownership and potential mergers in four regional markets (Wollongong, 68
Townsville, Launceston and Toowoomba)
Communications Law Centre 2006
iv CONTENT, CONSOLIDATION AND CLOUT
Communications Law Centre 2006
Executive summary
Media ownership and local content
The current context for media ownership reform – and in particular, the bundling of
‘Regional Service Protections’ with the dismantling of the cross-media rules – needs
to be seen in the context of far-reaching decisions in media policy made in the 1980s
and the short-term gains of media policy in the 1990s.
The most significant regional media policy decisions of the 1980s were ‘equalisation’
of television markets (so that most regions were supplied with three commercial
services) and ‘aggregation’ of a large number of small regional markets in
Queensland, New South Wales and Victoria into a small number of large geographical
zones. These were accompanied by the replacement of the two-licence cap with the
75% national reach rule for television and the introduction of rules preventing cross-
media holdings of commercial television, commercial radio and major newspapers in
the same market.
These decisions have, in most cases, resulted in extra television services provided by
three regional television networks. However, a by-product has been the national
syndication of programs and a loss of local television content in some areas that
mirrors the loss of local content on regional radio.
Networking and local content provision
The report of the House of Representatives Standing Committee on Communications,
Transport and the Arts, Local Voices: An inquiry into regional radio (September
2001), drew attention to the decline of local radio programming. The committee made
a number of relevant recommendations in relation to access and diversity, local radio
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vi CONTENT, CONSOLIDATION AND CLOUT
and commercial viability, the role of radio in emergency situations, and digital
broadcasting services. Shortly after this report, community concern over the closure of
regional television news services triggered two ABA
investigations.
The ABA’s first investigation (in 2001-2002) covered the aggregated markets in
Queensland, New South Wales and Victoria. The ABA found that not all licensees in
these markets were providing an appropriate coverage of matters of local significance,
and therefore were failing to fully meet their obligation under the Broadcasting
Services Act 1992. The curious absence of any specific individual responsibility on
the part of licensees for local content needs to be understood in the context of
deregulation, via the Broadcasting Services Act, of a number of policy settings in
relation to programming and licensing of Australian broadcasting. In particular, the
Act deregulated the existing localism requirement by introducing a statutory licence
condition applying to all licensees. The previous broadcasting legislation
(Broadcasting Act 1942) obliged each licensee to be responsible for this standard of
provision in relation to its own service.
Accordingly, the ABA proposed an additional condition on all 13 regional licensees in
the four aggregated markets. This condition would require them to broadcast a
minimum amount of programs about matters of local significance to each sub-market.
The scheme has had some success. While broadcasters in some local areas in regional
Queensland and Victoria have only barely met the minimum weekly requirement,
others in local sub-markets within some licence areas in Northern New South Wales
and regional Victoria have almost trebled the 120 point average requirement.
The ABA’s second report (in 2003-2004) focused on the remaining non-aggregated
regional and rural television broadcasting market. While the geographic reach of these
markets is much wider, their population and population densities are generally much
smaller. The ABA found that at least one commercial television broadcasting service
provided local news and information programs and concluded that it would be
inappropriate to require licensees to provide additional material of local significance,
at least at that time.
Against this background, the proposals for regulatory change released by the Minister
for Communications, Information Technology and the Arts in March 2006 would
remove the cross-media rules and replace them with a ‘safety-net’ test that permits
mergers in regional markets only in circumstances where at least four commercial
media players would remain. This initiative is tied to a package of ‘Regional Service
Protections’ which includes:
(cid:131) legislation confirming the operation of the local content licence conditions
imposed by ACMA on regional broadcasters;
(cid:131) continued monitoring by ACMA of local news and programming output by
regional commercial broadcasters and possible allocation of new licences if
diversity is reduced through format changes; and
(cid:131) monitoring of local content in areas not covered by the current licences and on
commercial radio.
In presenting these regional ‘protections’, the discussion paper expressly recognises
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CONTENT, CONSOLIDATION AND CLOUT vii
the difficulties of providing adequate television services to residents of regional
Australia. But it gives little consideration to the impact in those markets of mergers of
the existing media companies.
Rationales and realities of Australian media ownership regulation
Regional media in Australia is already highly concentrated. In mid-2005, four
companies (News Corporation, John Fairfax Holdings, Rural Press and APN News
and Media) controlled all but seven of the 36 regional daily newspapers in Australia.
Three regional television networks (WIN Corporation, Southern Cross Broadcasting
and Prime Television) held all but four of the 39 non-metropolitan commercial
television licences in Australia. There was more competition in regional radio,
although in mid-2005 three networks (Macquarie Regional Radioworks, Broadcast
Operations, and Grant Broadcasters) accounted for 132 (61%) of the 215 regional
commercial radio licenses.
Nonetheless, and despite the ‘Regional Service Protections’ of the 2006 discussion
paper, the philosophy underpinning the latest policy developments relies on a theory
of proliferation of media sources in a digital age. While major media policy decisions
of the late 1990s (including the Australian models for digital television) have
themselves constrained the growth of new services, the advent of pay TV (also a
policy decision of the 90s) and the growth in Internet and broadband services are seen
as justifications for removal of the cross-media rules and the answer to a potential loss
of diversity.
It is in this environment that the concept of diversity has been refashioned to refer to a
multitude of pieces of information – a proliferation of data – much of which is
recycled and offered as a source in its own right, and much of which originates
overseas or is anecdotal in nature.
These arguments fit with a transition from structural regulation of media ownership –
via the cross-media rules – to content regulation. A principle underpinning efforts at
media reform since 1996 is that consolidation between the influential traditional
media companies poses no threat to diversity because news and information are freely
available elsewhere. The evidence for this claim appears to be found on the Internet
sites of existing media companies, overseas pay TV channels and soon-to-appear
datacasting services. The Productivity Commission’s recommendations in 2000 for a
phased approach to deregulation, structured around encouraging genuine competition
in new services and the removal of barriers to entry in traditional media, were largely
ignored in policy terms. Instead, an attempt to dismantle the current system was
attempted in 2002/2003, based on proposals for merged companies that would retain
separate editorial arrangements.
Since that time, the ACCC has hovered at the margins of media regulation. Recent
indications are that the ACCC will change its approach to the definition of media
markets to look across media platforms. However, nothing concrete has emerged from
the Commission.
Communications Law Centre 2006
