The Australian

was just rubbing it in this morning when it headlined a story on the
federal government’s media reform package with “Extra channels in media
shakeup”. The reference is to new channels to be run by existing
networks: as the article makes clear, there will be no new TV licences

This is interesting, because if you talk to people who
work on media policy from a broadly liberal or free-market point of
view – the sort of people who are usually in the government’s corner –
that is the one thing they all agree on: the need for more competition
in free-to-air TV. It’s an absolute policy no-brainer.

existing networks run a cosy little cartel that ensures a narrow range
of programming catering to the lowest common denominator. But their
perceived political power makes the government reluctant to do anything
to offend them. It is hardly coincidental that the phrase “a licence to
print money” was actually coined (by Lord Thomson of Fleet) in relation
to the issuing of commercial TV licences.

Contrary to popular
belief, monopolies are not all alike. What matters is not so much
actual competition, but potential competition. Where there is only one
supplier in a market (such as newspapers in Adelaide), quality will
suffer, but the threat of a possible competitor coming in still
provides a valuable check. With commercial TV there is no such threat,
and so nothing to stop the networks treating their consumers with

A government that was even half serious about its
“reforming” or “neoliberal” credentials would never allow this. If
nothing else, by keeping the current cartel in place it seriously
undermines its own case against the ABC: the strongest argument for
continuing a government-funded network is the need for some alternative
to the junk that the commercial channels put out.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey