Communications Minister Mitch Fifield has announced a shake-up of Australia’s media ownership laws. So, what rules are being scrapped? And how might their axing affect Australia’s media sector?

The rules

On the chopping block are the “75% reach” and “two out of three” rules.

The 75% audience reach rule began life in 1987 – before the internet – as a 60% audience reach rule. It meant that the population of the licence areas controlled by one person or company could not exceed 60% of the total Australian population.

Subsequent adjustments made in 1992 extended the rule to 75% of the national audience. This rule’s practical outcome was to create commercial metropolitan (Seven, Nine and Ten) and regional (Prime, WIN, Southern Cross Austereo) television networks.

The two-out-of-three rule was introduced in 2006. Its purpose is to prevent a single person or company from controlling more than two out of three media platforms – commercial radio, commercial television and newspaper – in the same radio licence area.

These rules – together with the “one to a market” rule for TV, the “two to a market” rule for radio, and the minimum independently controlled media voices of five in a metro area or four in a regional area (the “5/4” rule) – have the effect of providing a safety net for voice diversity.

There is abundant evidence that online streaming has made the 75% reach rule redundant. However, the two-out-of-three rule – and the other existing rules limiting market dominance – do still effectively maintain voice diversity, even if digital convergence allows these traditional media platforms to undertake cross-media production activities.

What might change mean?

Anticipating the changes, APN News and Media have already put their regional print division, Australian Regional Media, on the market. News Corp, which already owns 14.99% of APN News and Media, may be interested in acquiring a slew of daily and community newspapers in regional Queensland and NSW, and 30 online news sites.

fifield400pxNews Corp thus could stand to subsume titles such as the The Queensland Times, Warwick Daily News, The Northern Star (Lismore), The Daily Examiner (Grafton) and The Chronicle (Toowoomba). Each has its own particular local perspectives.

Mergers between regional and metropolitan television networks are certain. Cross-media marriages, such as between Fairfax Media and Nine Entertainment, are also a strong possibility.

Media owners, who are facing increasing pressures from the shift to online advertising and desperately want to expand across audience platforms, are likely to be the main beneficiaries of Fifield’s changes. The Coalition government, which in an election year can’t afford to have to deal with disaffected news media, also stands to gain.

The public, and in particular people in rural and regional Australia, do not even get a look-in. Even those living in smaller cities such as Adelaide, Darwin or Hobart, who already only have just a News Corporation daily to read, are facing the prospect of fewer alternative voices if News Corp were to merge with, for example, Network Ten.

Australian media ownership, and print media in particular, is among the most concentrated in the world. A steady trend to fewer owners over the last century is the well-documented pattern. But print media and their online successors are fundamental to news and information diversity and pluralism in democratic societies.

Responsible policymaking in the public interest needs to assume that media concentration will continue to be a problem in the online digital world. Research indicates there are clear economic and audience usage reasons for this, despite the rise of online streaming and multi-screening. Counter-arguments put forward based on the conventional wisdom of “internet abundance” are misguided and self-serving.

A new set of diversity rules

These rules, with the exception of the 75% audience reach rule, maintain limits on any one person or company from dominating with their “ownership voice” in a licence area or market. The government should consider what rules would maintain news voice diversity and be fit for the 21st-century media landscape.

The business model for regional media is a major concern for news audiences in those areas. Ideas for policy transfer from overseas jurisdictions are sorely needed. These may include a news content industry fund or levy, or other forms of tax breaks or public service subsidies, in addition to the existing local content scheme.

The proposed changes to the existing points scheme – which would require more local content in the wake of a “trigger event”, including more news content – is closing the gate well after the horse has bolted.

There is a pressing need to rethink policy and regulation in light of the ongoing transformations surrounding digital convergence. Traditional sector-based approaches to media policy are being challenged. But diversity and pluralism remain policies of high consequence because they are directed at maintaining an informed population.

It remains to be seen whether these amendments will survive a Senate committee, let alone be passed some time before the coming election.image-20160301-4063-1lzv1m3

The government wants to push the biggest overhaul of Australia’s media laws in a generation through parliament before the election, Communications Minister Mitch Fifield says.

Fifield on Tuesday unveiled the much-anticipated plan to substantially deregulate the media market – which the government is selling as a “microeconomic reform”.

The changes would scrap the present ban on a person controlling more than two out of three of commercial radio, TV and newspapers in one market. They would also repeal the “reach rule” – which prohibits a person controlling commercial TV licences that collectively reach more than 75% of the Australian population.

Prime Minister Malcolm Turnbull said the current laws had been out of date for years.

“The media ownership regulations in our law were written before pay television. They were certainly before the internet. They are a relic of a past media economy and they have been out of date for years,” he told Parliament.

Turnbull said governments had “kicked the reform of these media ownership rules into the long grass for so long that they have formed part of the rich subsoil of Australian political inertia. We are taking them out.

“We are tackling this important microeconomic reform and we are bringing the media ownership regulations laws into the 21st century.”

Assuming the changes are passed, they will set off a rush of commercial activity. There has been speculation of Fairfax merging with Nine and News Corp taking over Channel Ten.

The changes are not touching the anti-siphoning list – the sporting events kept for free-to-air television. Fifield indicated the government did not want to go down this path without agreement, which was not there.

While the government rejects the argument the planned changes will lessen diversity, Fifield admitted some organisations and people had concerns on this front.

He said the government could direct them to its retaining the “5/4” rule – which requires a minimum of five voices in metro areas and a minimum four voices in regional areas.

Also being kept were the rules stopping anyone controlling more than one TV licence in a market, and the two-in-a-market rule for radio. As well, there was the role of the competition watchdog, the Australian Competition and Consumer Commission.

With the abolition of the reach rule, Fifield said the government would establish stronger local content obligations for regional commercial TV.

These would apply to the majority of regional free-to-air commercial TV broadcasters that, as a result of a change in control known as a “trigger event”, become part of a group of commercial broadcasting licences whose combined licence area populations collectively exceed 75% of the Australian population.

“This ensures there is local content in nearly all regional areas following a trigger event, including those where there is none currently,” Fifield said. There would also be an incentive for local news to be filmed in the local area.

The legislation will be introduced into the House of Representatives on Wednesday and sent to an immediate Senate inquiry, which would take several weeks. While Fifield said he wants the package through before the election, this seems to presume the parliament runs full term – there would hardly be time to complete the inquiry and parliamentary debate before a double dissolution.

Fifield flagged he hoped to get Labor’s support for the changes. Labor supports the lifting of the reach rule but it is not clear where it will land on scrapping the two-out-of-three rule. Labor spokesman Jason Clare was noncommittal on Tuesday

Originally published The Conversation March1, 2016