Excellent freelance journalist Stuart Mackenzie has analysed the various submissions and transcripts from the Senate committee hearing on the media ownership bill and produced this enlightening piece.

In his evidence to this week’s Senate committee hearing on the media ownership bill, Kimber advised Australia to stick to the current cross-media ownership regulations and not make the same mistakes as Canada, which has no such restrictions.

The big end of town has other ideas, however.

Their positions on the federal government’s proposed changes to the media ownership rules are widely known and have been dutifully reported in their own news outlets.

News, Fairfax, Publishing and Broadcasting, Network Ten, the Seven Network all believe the current regulations are not needed to ensure diversity of opinion and are restricting their ability to compete in the global media market.

As public companies, with a primary duty to shareholders and at the mercy of the analysts’ spreadsheets, their arguments assume that what’s financially good for a corporate media owner is best for the Australian public.

PBL’s written submission contends, “Quality, quantity and diversity of the media are guaranteed by the need for for-profit media companies to maximise returns to their shareholders.”

But there was some interesting evidence given to this week’s committee hearing about the cross-media proposals that has gone largely unreported in the mainstream media evidence about public interest, diversity of opinion and the dependence of regional communities on local news content.

Network Ten executive chairman, the Canwest appointed Nick Falloon, does not see that diversity of opinion would be reduced by changes to the ownership rules.

“If the rules were changed and the Ten Network owned a newspaper group or a radio group, would I think that the opinion that we were putting out from those two avenues would change because they were commonly owned? I do not,” he said.

Falloon said he had not been following “to any great degree” the controversy surrounding his controlling shareholder, CanWest’s editorial policies, which he understood to be “some minor editorial issues” raised by some journalists.

This was despite Stephen Kimber outlining the extent of CanWest’s media dominance to the committee earlier in the day.

CanWest owns 14 daily newspapers in every major Canadian city except Toronto and Winnipeg. In nine of those cities, it also owns a local television station.

It owns the National Post one of two national newspapers four other television stations, 126 smaller daily and weekly newspapers, six digital cable television stations, a television and film production company and Canada.com the third most popular Internet site in Canada. The television network reaches 94 per cent of Canadian households.

Kimber explained that CanWest requires all of its metro daily newspapers to publish regular national editorials prepared by the company’s head office. The local papers are not allowed to criticise or take positions different from the national editorials, regardless of regional conditions or interests.

This has resulted in the Asper family’s well-known support for the Canadian federal Liberal party, for military spending and for Israel in the Israeli-Palestinian conflict being presented consistently across the country.

Asked by Liberal Senator Tsebin Tchen why this was any different from the days when famous journalist-proprietors pushed a viewpoint, Kimber replied, “There were lots of other voices out there for them to compete against. In the case of the Aspers, what I think makes a big difference is that they own the game.”

“The fewer the owners, the less likely it is that readers will have access to a wide variety of viewpoints,” he said.

While the federal government’s bill removes the barriers to investment by foreign entities in Australian media that are contained in the Broadcasting Services Act, the cross media rules would remain.

However, owners of two or more media entities that would otherwise breach the cross-media rules would be able to apply to the Australian Broadcasting Authority for an exemption certificate, providing they meet three mandatory tests of editorial separation.

These are the existence of: separate editorial policies; appropriate organisational charts; and separate editorial news management, news compilation processes and newsgathering and interpretation capabilities.

Questioned by senators, ABA chairman Professor David Flint believes he could objectively administer the exemption provisions despite his view that there is no point to cross-media ownership restrictions.

The bill also proposes to rely on competition law, including the Trade Practices Act 1974 to maintain competition, choice and diversity.

However, Professor Allan Fels, chairman of the Australian Competition and Consumer Commission said in his evidence that public interest issues, such as diversity of opinion and ideas are outside its scope.

“I have to be quite clear and frank about this. Whether even I like it or not, the fact is that, under competition law under the Trade Practices Actunder competition law everywhereyou would only look at the narrow economic question.”

This view was supported by evidence from Dr Derek Wilding, director of the Communications Law Centre.

He said the UK government, when releasing its recent bill on media ownership had warned, “For the time being legislation must address the present situation, where most people engage with the media in their traditional forms, and media ownership rules remain the best way of doing this. Competition law alone is not sufficient. It can address issues of concentration, efficiency and choice, but it cannot guarantee that a significant number of different media voices will continue to be heard, and it cannot address concerns over editorial freedom or community voice.”

Wilding added, “The approach that is taken in the United Kingdom still rests on the requirement to regulate ownership. That is fundamentally different from the approach that is taken in our media ownership bill which rests on an approach based on content.”

Wilding dismissed claims attributed to Peter Yates of PBL that the media is just another market like that for beer or toothpaste.

“The nature of media products is conceptually different to other productsand that is not something that is simply recognised in Australia but is something that is recognised around the world,” he said.

“The capacity of media owners and media organisations to structure debate or to influence opinion simply does not apply to products like beer or toothpaste.”

Wilding also doubted the effectiveness of the proposed rules for editorial independence.

“We have seen Kerry Packer, Rupert Murdoch and Robert Holmes a Court all dismiss charters of editorial independence as either being unworkable or not being relevant to the activities of their business.”

“If that is the case, there is a real question over them. I really question whether there would be any commitment to the scheme that is proposed within this bill.”

Wilding’s concerns were supported by Stephen Kimber’s evidence that the Canadian Radio Television Commission, which is similar to the Australian Broadcasting Authority, has already tried and failed with similar measures.

“Quebecor a publisher of 15 daily newspapers was required to keep its newspaper newsrooms separate from a newly acquired TV network. Less than a year later, its web site boasts that the ‘synergies between the internet, cable television, broadcasting, newspapers, telephony and publishing media are now a reality.'”

“In Halifax, the editor of the Daily News and the news director of the local [CanWest] TV station now regularly discuss which local stories each will cover and how they will be covered. [The TV station] uses Daily News reporters on its newscasts to provide coverage of events its own reporters no longer attend, meaning the variety of perspectives its readers and viewers gets is reduced, ” said Kimber.

A number of regional media operators argued in their evidence that the ownership debate was being driven by metropolitan considerations that did not necessarily apply to country areas. However, there are opposing views on the need for cross ownership regulation.

Giving evidence jointly, RG Capital Radio, WIN Television and Rural Press claimed that existing regulations were preventing them from growing and that maintaining local content was becoming “incredibly difficult”.

RG Capital managing director, Rhys Holleran, said rural media organisations were at the “crossroads” in terms of local content and staffing and decisions were being made about dumping local programs from rural markets.

Holleran claimed that thousands of rural media jobs would be at risk if the cross media rules were not abolished.

John Rushton, chief executive of WIN Television, said cross-media ownership restrictions should not apply to regional media and cross-media expansion in regional markets should not be conditional on minimum levels of localism.

And he wants a government handout.

“The government should encourage the provision of local news programming through rebates against licence fees and taxes for companies who employ local people to gather and present news and information in regional and rural areas,’ he said.

Holleran claimed that they would be in a far better place to produce local content if they could develop “synergies” with other companies.

Challenged on whether these synergies meant job losses, Brian McCarthy, managing director of Rural Press, said that he wanted to increase revenue opportunities while maintaining the costs they already had.

Labor Senator Sue Mackay had some difficulty understanding this argument and why amalgamations of regional media companies would not result in the same job losses that had been seen in rural bank branches.

Chris Warren of the Media Entertainment and Arts Alliance echoed this concern.

All his experience, he said, showed that consolidation through change, including at APN and Rural Press, leads to a serious reduction in jobs in regional Australia.

In 1985, a Communications Law Centre survey showed that the number of radio journalists had dropped by something like half as a result of the consolidation into radio chains and the loss of local news production, he said.

Grant Broadcasters, a privately owned family company that has been in regional radio for over 60 years and owns 15 commercial stations, mainly in NSW and Victoria, has a strong view about the regional market.

Managing director Janet Cameron told the committee that her objection to the elimination of the cross-media rules “is based on the simple premise that I cannot see any benefit for the public in such a change. The only benefits, in my view, would be that those already very large media groups would grow even larger, and those who may wish to sell would have a greater number of buyers and therefore would gain a better selling price.”

Another Grant director, Alison O’Neill, added that she couldn’t understand RG Capital’s argument that job losses would result unless the rules changed.

“I think that everybody recognises that part of the reason for the relaxation of the rules is to allow for some acquisitions and mergers to allow for economies of scale,” she said.

“The reality is that there have to be job losses70 per cent of all costs in radio are staffing costs. The only way to save money is to reduce staff.”

Grant’s operate full-service radio stations with minimal networking of content and Janet Cameron believes this is the only way to fully participate in the community.

Kevin Blyton, president of the Australian Association of Independent Regional Radio Broadcasters (IRB), told the committee he could see no public interest benefit at all in the bill.

“I do not know what benefit someone living in Cooma gets from the radio station, the newspaper and the television stations all being owned by the same people,” he said.

“It seems to me that this bill benefits about 12 companies in Australia. It is about allowing them to grow.”

Advertising revenue in a regional market is only so big and the only way that they can grow is to either increase their revenue or reduce their costs, Blyton said.

“The only way to achieve the economies that they want is to cut costs, and that has to be cutting staff. There is no other way to do it.”

Asked about the potential of new media in regional areas, Stephen Everett of the IRB said it was largely irrelevant.

Pay TV and the internet do not offer any local news services. There are three sources of local news: the radio station, the newspaper and the television, and 99.9 per cent of people get their local community information from those three, he said.

“Perhaps in 10 years time it will change, but certainly not in the foreseeable future.”

After this week’s Senate hearings, all the players have now run up their colours.

The global media owners believe that their financial success on the world stage will deliver a diverse, quality media in Australia.

Local owners claim that growing their domestic business through takeover, economies of scale will save regional media jobs.

Some regional independents who want to stay that way take a more altruistic approach to their businesses and their community involvement.

And how does the public’s view on this get heard?

Isn’t there supposed to be an institution that keeps a check on the powerful and gives a voice to the voiceless?

What conflict of interest would that be then?

Stuart Mackenzie can be reached at [email protected]

Get more Crikey, for less

It’s more than a newsletter. It’s where readers expect more – fearless journalism from a truly independent perspective. We don’t pander to anyone’s party biases. We question everything, explore the uncomfortable and dig deeper.

Join us this week for 50% off a year of Crikey.

Peter Fray
Peter Fray
Editor-in-chief of Crikey
50% off