I am delighted to be able to join you to deliver tonight the Annual Media Studies Lecture at La Trobe.

But I am not in a position to lecture anyone about what is happening in the media today. I don’t think anyone is. We are in such a state of transformation and turmoil. So much of what we assumed to be true about the media business has been turned on its head.

Every month brings a new twist on this revolutionary road — witness yesterday’s remarkable broadband decision by the Government. In one dramatic act, the Prime Minister’s announcement is set to reshape the future for media organisations, telecommunications firms — and most importantly — audiences across the nation. At the ABC we are still scrambling to the think it through — to contemplate what it all might mean.

So I don’t presume to lecture anyone. I have far more questions than answers.

Let me instead make some gentle observations — about the things we can now say to be true about this rapidly changing media sector — and then to use the famed Rumsfeldian line — talk about the “known unknowns” — the unresolved questions that may be keys to the media future in Australia.

The headlines written in the twelve months since the last annual media studies lecture would have been unimaginable just a few years ago: the Nine and Seven networks effectively worth nothing; Fairfax’s share price down from six dollar highs to seventy five cents; waves and waves of newsroom sackings; revolving doors for editors in Sydney and Melbourne, Canberra and Perth. And I have been regularly startled by terrible headlines about the ABC — only to be then relieved that the stories were around childcare.

But then, looking more globally, we have major American cities set to go without local newspapers. The New York Times threatens to shut down The Boston Globe. Governments investing in the press to prop up market failures in France. Daily, doomsayers beat the drums for newspapers, free‐to‐air television, regional media and investigative journalism.

If you love the media and the role it can play in society; if you believe robust journalism is vital for a vibrant democracy and an informed citizenry; then it may feel time for the media professional to exercise the Captain Oates option and say: “I am just going outside and may be some time.” This media revolution has no precedent. Not only is the age of the media barons disappearing; the age of the mass audience — with mass advertising that paid for much of our best journalism — is passing. Those of you studying journalism in 2009, the children of this particular revolution, must be wondering “Is the
age of great journalism now over as well? Is this the price that must be paid for all the other wonders of the digital age?”

I would argue there are some grounds for optimism, there are opportunities to hope. There are only some things we know for sure — much that will determine the future of the media in this country at least, remains undetermined. They are the known unknowns.

So what do we know?

You may ask why any of this matters to me? After all, I manage a public broadcaster — supposedly better protected from the cyclical and structural changes sweeping through the media sector. But the ABC is not an island. It can only remain relevant to its audiences by anticipating and reacting to technological advances and the societal and commercial trends that accompany them. And as a former newspaper executive, I retain a deep interest in all parts of the media sector. We need and welcome strong competition from our commercial rivals.

Unfortunately, the commercial media story at the moment is not a happy one. Companies endure bleeding bottom lines, ugly balance sheets and savage costcutting. And this devastation has its origins in three major factors.

The Cyclical Crunch

The first, obviously, is the economy. Anyone who has worked in media businesses knows that when the business cycle turns down, media organisations are hit fast and hard. Companies view advertising as a discretionary budget item to be cut. Those decisions are often arbitrary, across‐the‐board — and can be made at global headquarters halfway around the world.

Everyone feels the pain. In media businesses that rely on classified advertising, margins dry up as fewer homes are put on the market, cars remain unsold and job vacancies disappear. Commercial radio and television stations, heavily reliant on advertising, get hammered. Newspapers suffer — the bulk of their income comes from advertising revenue, not news stand sales.

Media costs are notoriously hard to adjust to match these revenue declines. You still need reporters and others to print and distribute the paper. The TV schedule needs to be filled. Radio announcers still need to tell the time, cue the music and play whatever ads are left. But traditionally, costs are cut. Expenses are tightened. People are let go. And the tough days are ridden out until things look better again. When that happened in the past, the staff came back, the travel plans were dusted off and the long lunch returned.

I fear this time the “rebound” may not occur. Even in its own right, a downturn of this swiftness and severity would have had profound impacts on the operations of media organisations. But now the industry is also being carved up by structural change. Executives, particularly those in the newspaper business, wonder whether the good times will ever come back.

The Shattering Structure

There is a vibrant mythology around media barons. In Australia, there are great colourful stories about the Packers and the Murdochs, the Fairfaxes and the Symes. These media proprietors achieved enormous wealth and influence by thetraditional business model through which they effectively could control communication with mass audiences. When it came to commercial TV or major metropolitan newspapers — only a handful of business operators held the broadcasting licences, or had the ability to transmit or publish in a way to reach such big audiences. They were remarkably lucrative oligopolies — quite literally licences to print money. Advertisers would pay premiums to reach the audiences and these traditional media outlets were the only way to do so. It was a business model that laid the foundations for Kerry Packer to be Australia’s richest man and Rupert Murdoch the world’s most influential media executive.

In fact, these owners made so much money — and often structured their companies for control in such a way — that they did not simply need to maximise profit. Being a media baron brought wealth and power — and at times, maximising wealth wastraded off against being able to maximise brand power and influence. So Kerry Packer would run a big news division — and stay with news programs like Sunday that were not profitable — because he wanted to. And because the Prime Minister would come calling to be interviewed by Laurie Oakes and because it furthered Packer’s already formidable punching power in Canberra. You can see the same in Rupert Murdoch — running lossmaking papers like The Times in London, The Post in New York — and for many years here The Australian — because he could afford to and for the commercial, political and cultural influence they brought him and his organisation.

But as we all know now, the structure underpinning that traditional business model is shattering. It is the second known truth about this media transformation. No longer is it the time of the Citizen Kanes. Let’s call it the Citizen Wayne era — a time when anyone with a computer can put on an eyeshade — if such things exist anymore — and become a multi‐media publisher. The content available to be read and seen here is no longer just what a few media managers in this city determine. The world’s content is available in an instant. Audiences have so much more choice — advertisers do too. Fragmentation erodes the dollars and the profits.

Audience behaviour is rapidly responding to new choices and opportunities. Nielsen’s 2009 Australian Internet and Technology report revealed that 49% of Australians online regard the internet as their preferred information source. That is well over double those choosing television and over three times those choosing newspapers.

And as to the question about which media form you would be lost without: the internet is at 39%, mobile phones 15%, TV 13%, radio 8% and newspapers 4%.

Not surprisingly, traditional media outlets are working hard to build online presences. But current indications suggest these branded sites cannot be as profitable as their legacy equivalents. Online, there are too many competitors in pursuit of the same audiences and advertisers.

When you consider that most Australians had never been online a decade ago; that great parts of the country currently do not have access to broadband; and that the capacity to use a mobile phone as an internet browser is in its infancy; then you can see how the tectonic plates are shifting.

For those newspapers that have subsidised their editorial operations on the staggering profitability of classified advertising, the reality is that someone has invented a better mousetrap for capturing consumers. The web is a faster, cheaper and better way of linking buyers and sellers of cars and homes than acreages of newsprint could ever be. The blunt reality is that those classified ads will never come back. The problem is not only with the disappearing black ink. The classifieds represented 40% of revenue, but revenue at profit margins that pushed 90%. Extra pages of classies that came from a busy Thursday in the call centre dropped pure profit to the bottom line. And that profit kept cover prices low, funded international and investigative journalists, cranky columnists, eccentric cartoonists — it funded all the things that made papers great.

For free‐to‐air television, the fragmentation is coming not just from online, but from what the networks will do to themselves with the digital spectrum. Talk about a dark Underbelly. In the multichannel world, broadcasters will take a finite audience and split it with new channels, increasing costs and fragmenting advertisers at the same time.

Ironically, many of these media organisations are still highly profitable. But the structural change means they will not grow profits as they once did. It is a story of decline. And that is not a story to attract the pivotal institutional shareholders who need to outperform indexes and find compelling growth stories to back. Eventually, the investor money goes elsewhere. Confronted with sluggish share prices and under‐performance, boards look for those who can cut costs and pump profits quickly to resurrect confidence, the share price and some short‐term value.

Business Blunders

Some people saw this revolution coming years ago. I remember hearing the confident predictions during the tech boom that newspapers would be dead — by 1999.

A decade on, we can see that perhaps we were dealing with the phenomenon some describe as macromyopia or Amara’s law — the tendency to overestimate the impact of technological change in the short term and underestimate its impact in the long run.

Now we are seeing those long‐term impacts. There is an Australian context that has made them worse. Part of our current bleakness is driven not just by the downturn and structural change. The third “known” is poor decisionmaking. Judgments made at the height of the boom when cheap finance abounded now look pretty sick in hindsight.

The reason the market is valuing Channels Nine and Seven at zero is not because they are trading unprofitably — but because of the massive debt incurred when controlling purchases were made by private equity firms. At Nine we can see the consequences of significant cost cutting to help service that debt. The ability for Nine to patiently grow audiences as they did with Sixty Minutes in its early years, or to sustain programs that are not instant hits is practically non‐existent.

It is interesting to me that many of those who made the greatest wealth from the Australian media have not been stung in this way. The Packers sold out at a massively high price. Kerry Stokes cashed in handsomely but stayed at the table. In KKR, he may have found his own Alan Bond. And the great acquirer,  Rupert Murdoch, stayed on the sidelines when the laws were finally changed allowing him to own free‐to‐air television in the same markets as he controlled newspapers.

Fairfax is a fascinating case study. The company was worried about being caught half way — much smaller than PBL and News Limited — but significantly bigger than APN and Rural Press and West Australian newspapers. There was continuing concern at the earnings dependence on The Sydney Morning Herald and The Age and there had long been a strategy to dilute that dependence. Years of potential deals with Australian partners delivered little. The laws allowing cross‐media ownership changed. A frenzy of deals was expected to break out and Fairfax worried about being swallowed up by a larger player or a consortium of smaller ones. So Fairfax did the big company defining deal — the merger with Rural Press.

Rural Press had been on the Fairfax shopping list for years. Ostensibly, bringing the reach and impact of Rural’s regional newspaper network to Fairfax’s metropolitan mastheads seemed very complementary. At the right price, a decade ago, that was undoubtedly true. For Fairfax, Rural helped fill in gaps in the newsprint marketplace, brought efficiencies in printing, a track record in growing shareholder earnings — and it bulked Fairfax up — for a while at least, putting it out of any acquirer’s reach.

I think Fairfax‐Rural Press merger will provide rich grounds for evaluation by management schools in the years ahead. Most argue that with the departure of David Kirk as CEO, the filling of nearly all management positions by Rural Press executives and the appointment of pivotal new editors by that new management, mean it has proven to be not a merger but a reverse takeover.

Of greater significance, though, is whether the strategy was right. In hindsight, it may prove to have been precisely the wrong time to load up with debt. However, some would argue that without the rural papers, Fairfax would have been more devastated by the economic downturn and the pace of structural change.

But the longer term question lingers: Was it smart to spend so much money to own so many newspapers, just as newspapers are being hit hardest by the waves of structural change? Given yesterday’s broadband announcement, was it smart to bet the company’s future on newsprint as fast internet speeds become a reality in every home in rural Australia, undermining the ability of country papers to extract monopoly rents from advertisers?

Globally, you can also see numerous examples of disastrous media deals. Real estate billionaire, Sam Zell, purchased The Tribune group only to see his massive debt triggering savage cost‐cutting at iconic American papers like The LA Times.

There is something about media acquisitions that can attract strange bedfellows and distort what is normally the soundest judgement. Two decades ago, when Australia’s media organisations were last in great turmoil, new owners emerged for each of Australia’s three to air commercial networks ‐ Christopher Skase, Alan Bond and Frank Lowy, who made the worst deal of his 50‐year career in purchasing the Ten Network. There has been something about the prospect of owning a media asset, becoming a media baron — thinking that it all will be easy to execute — that has resulted in terrible outcomes for the organisation, for its staff, for its audiences, for its shareholders and for the industry.

What we can see in Australia now is the consequence of this triple whammy ‐ the cyclical crunch, the shattering structure and the business blunders. I suspect if you are studying media with a sense of wanting to work in the profession, there have never been more pressing issues than the ones you may need to face now. What media models will operate that allow companies to recruit and employ and offer meaningful careers? What roles will there be for media professionals?

The answers to those questions lie in the myriad of ‘known unknowns’ that occupy the media space at the moment. We should be comforted by one fact — there has never been more active debate and engagement around the future of media organisations, the path ahead for journalism, and the search for sustainable and profitable models.

The NYU academic, Jay Rosen, recently published on his blog PressThink, what he described as his Flying Seminar in the Future of News: links to a dozen major thoughtful pieces written in the month of March on the decline of the newspaper model. They are a widely varied, passionate and challenging collection — and an example of the vibrancy and engagement around these kinds of issues. We ran a Future of Quality Journalism seminar at the ABC in Sydney last week for broadcast on Radio National next Saturday. It attracted hundreds to our studios on a bleak and miserable afternoon. There is active concern and engagement around these issues happening here and around the world.

So what are some of these ‘known unknowns’?

Is there a viable future for newspapers?

When a newspaper in Seattle closed last month, I was astounded to read that its weekend edition sold 400,000. In doing their sums, the owners evidently decided that an on‐line version delivered by 20 journalists, with no need for printing presses, delivery trucks or distribution networks, was preferable to a print edition put out by 200 journalists. The reason 400,000 stood out for me is because that has long been the golden number for the Fairfax’s main weekend broadsheets — the edition that made all the money. I was struck that you could sell that many papers and still not be viable.

So is there a viable future for newspapers — our first ‘known unknown’.

As I have said — the advertising erosion has meant that the underlying subsidy for quality journalism is disappearing. But for decades, readers have happily and obliviously taken advantage of this subsidy to pay far, far less for the paper than they would have to pay if the subsidy wasn’t there. I suspect there isn’t much appetite in the marketplace for the $10 Saturday Age.

Some, like Eric Beecher, are fatalistic about the future of papers, arguing that new models need to be found, including public investment in newspapers as a public good — as is now developing in France. Let me assure you that the ABC has had no phone calls from government asking us to scope out printing presses. I can’t see it happening here.

But it is so hard to see what is happening. What we haven’t seen yet is the bold, imaginative play that we may have anticipated in a crisis such as this — an attempt to recognise that a newspaper that simply is delivering yesterday’s news that has already been commoditised online is in terminal decline. There have been no bold new models developed — such as the tight, well‐written, highly analytical Herald‐Tribune style newspaper suggested by the former Age editor, Michael Gawenda in recent months. In part, it is because the newspaper companies still have too much to lose. They are still making money; just not as much as they once did. There is no evidence the new models would return the big profits of the past. But structural change has unleashed revolutionary forces on newspapers, and I am not convinced a viable solution will be found in incremental adjustments.

It does strike me that much of the bold and creative thinking about the future of print seems to be happening outside the major publishers — probably because the talented people within are too busy simply attending to the fire in the building. That is understandable. What is disconcerting though, is that with all the world’s great newspaper companies focused on this issue — with everyone scrambling to come up with a viable and sustainable growth story for newspapers in the internet era — no one has done so yet.

What is far more likely in an Australian context is continued significant rationalisation of the sector.

A world of smaller newsrooms, outsourced subbing, centralised commissioning and editing. A world where newspapers editors have their clout and roles downgraded, simply deciding on the local contribution to a nationally conceived and directed paper.

I suspect we also face the prospect of Sydney and Melbourne becoming onepaper towns like their small state counterparts and much of the US market. We will see closures and mergers. And if the Fairfax share price cannot escape the doldrums, the very real chance of a carve‐up pursuing buyers willing to pay premium prices to own iconic assets, no matter the business model challenges. Would leading citizens of Melbourne love to own The Age and pay a price for doing so? I would think so. Or Kerry Stokes for the SMH? Maybe.

And how about a marriage between the Fin and the Oz — creating — serendipitously — The Australian Financial Review? It would combine The
, with its coverage of Canberra, the nation and the world, arts and sport; and the Fin, with its coverage of business and markets. The prize would be a lovely 80‐page tabloid, selling 160,000 copies a day, and a real force in markets with only one local paper. In a sense, this is the most obvious deal in print to me. And whilst it may seem a bit far‐fetched, few predicted success when Murdoch put down cash to buy out the Bancroft family at the Journal. In the media, more so than most places, everyone and everything has a price.

Murdoch Senior/Murdoch Junior

What News Limited still thrives on is the benevolence of a proprietor, who, aided by his ownership structure, can still seem to call the shots at the company as if he owned the lot. It has allowed Rupert Murdoch to expand and protect those newspaper assets he loves. But when profits and share prices are hammered as they have been in recent times, even Murdoch needs to cut hard — as his editors and executives are seeing now.

While Murdoch still plays the proprietor with verve and energy — a real known unknown in Australian media is News Limited without Rupert. His mother’s recent centenary birthday is testimony to the strength of the gene pool and his own drive seems almost unstoppable. But assuming at some time, the sad, common experience of humanity intervenes, or perhaps as surprising, his irongrip on the company is loosened, what would it mean for Murdoch’s Australian operations?

We don’t know much about the performance of Murdoch’s domestic papers. There is no doubt that The Australian has been largely protected by its proprietor from a need to deliver a sustainable return on capital. It would also appear that his other papers have not had to work as hard to deliver the normal commercial returns required by a more conventional owner, or if those papers formed a major part, not a fraction, of a company’s media portfolio.

Whilst the continued dramas at Fairfax and the uncoupling of the Packer media business from the Packer family generate all the attention, the big story in years to come may be News Limited after Murdoch. What is Lachlan up to? What are his ambitions? Having cut his teeth on the Australian newspaper business, will he return, as a benevolent proprietor — willing to trade off big profits for influence and his own passion and engagement in producing a winning product. Another known unknown.

What are some others? Here are a number I don’t know the answer to — but am watching with interest.

Broadband Australia

After years of procrastination and political squabbling, the national broadband network is coming. At the moment, the fascination is with the Government’s “rabbit out of the hat” announcement — the decision to junk the bidding process, to set up its own “super fast network” that will put optic fibre direct to the home. And the Regulatory Discussion Paper which, very pointedly, adds to Telstra’s woes by looking at further ways of crimping its powers.

The more important question is what this development — correctly described as an historic nation‐building investment on a par with the Snowy Hydro — will ultimately mean for the industry and for consumers. Firstly, as can be gleaned from my earlier comments, I suspect it is bad news for rural newspapers who will join their metro cousins in experiencing the pain of fragmenting audiences and advertisers. Commercial radio in the country will also feel the blowtorch.

At the ABC, we are investing in the capacity to turn our local radio stations into media hubs. They will be a centre that not only allows us to distribute text, audio and video through broadband, but to host contributions made by our audiences in these forms. The online world — be it through Facebook, Twitter or World of Warcraft — creates vibrant communities of interest. It also opens the hyperlocal door, allowing the creation of local video news bulletins to be distributed to interested audiences in a way you have never been able to do before. Part of the ABC’s funding proposal in this budget is to seed money into communities to allow them to develop local content for audiences — for the ABC to train, facilitate and host — but allow new audiences to create content themselves.

And the capacity of this network will enable us to deliver high definition quality television services direct into homes, without using traditional transmission services. Over time, it would enable the ability to deliver many more suites of programs or channels showcasing what the ABC can best offer — but that is currently constrained by spectrum limitations or transmission costs. Traditional TV services will still be the main way to reach households — but other exciting options for the multi‐channel, multi‐platform world of the future are opened up by this Government decision. What this will finally mean for audiences and media organisations is still a ‘known unknown’ — but you know the country will be very different when linked up with broadband of this speed and capacity.

Watching Telstra

Speaking of Telstra, everyone is watching with keen interest their response to the National Broadband Network, not only as a Telco but as a major media content player.

Despite this week’s setback, Telstra has the capacity to become Australia’s largest commercial media organisation. They own half of Foxtel, they own cable to the door and they have the right to put their own set‐top box in people’s homes. They are the dominant ISP.

And increasingly they are the owner of online rights to major sporting events, that in due time will be able to be seen as a full‐screen television experience delivered by broadband. Rather than seeing themselves as simply a conduit through which audiences can access an array of content, they want to be a provider and steer audiences to the content they provide.

In a world where terrestrial television, subscription television and IPTV can all be delivered to a set‐top box for a seamless, integrated audience experience — it pays to watch the organisation that is set to dominate IPTV, owns half of subscription TV, and has the cash to buy a free‐to‐air channel at the drop of a hat.

But it is clear the Government is also mindful of the ability of the Telstra giant to dominant the new media landscape. The discussion paper released by Senator Conroy yesterday makes clear the view inside Canberra and in the wider industry that a new regulatory regime is needed to ensure proper competition. As if being squeezed out of the broadband network wasn’t enough, now the Government is openly canvassing options like structural separation, cross‐media restrictions and cable network divestment.

The future of Foxtel, 50 per cent owned by Telstra, is intriguing. It is now making money — and they say — holding audiences through the downturn through a mix of attractive technology and a valued family entertainment proposition. Does the company have a path to sustainable, continued growth? Or unlike the US, which has 90% subscription TV penetration, will Foxtel remain a niche player, unable to woo a clear majority of households as a value proposition?

We have also heard recently from subscription television a plea for access to Government funding for programming. The claim is to money the Government might make available for funding drama on the public broadcasters or a free-to‐air children’s channel. Our strong counter‐argument is that if the Government is to directly fund the development of programs that people should have access to see, then programming should be available free‐of-charge in every home; not just those willing to write a monthly cheque.

Inhibiting Foxtel’s growth have been the anti‐siphoning laws restricting its access to live major sporting events — a list that will be reviewed next year by the Federal Government. The free‐to‐air networks will argue for changes to allow them to show major events on their new multi‐channel services. Free‐toair television, acting under the banner of Freeview, will attempt to convince households that digital free‐to‐air TV will offer 15 channels without the monthly bill and provide a strong range of programming. You have to think that superfast broadband will deliver so much more content directly into homes in television‐like experiences, without the intermediary of a subscription television provider. It is going to be fascinating to watch.

The choices facing Free‐To‐Air

We can see a very clear pattern emerging on free‐to‐air television. The networks are financially strapped and with very short investment horizons. As I indicated earlier, programming demands and advertising fragmentation caused by digital multichannelling is adding to the pressure.

If you run commercial television, an hour of television is an hour of inventory. What do you do to maximise the return on that inventory? Create the highest rating program you can find and produce it at the lowest cost.

Reality TV, formats and quiz shows: in the main they are cheap to produce and may spike an audience. Just as importantly, they can be quick to drop if they don’t work.

If there is some breakout interest, like Nine with Gordon Ramsay last year, you milk it. Food lovers and swear‐word devotees could rejoice in three episodes of Gordon Ramsay in prime‐time for a number of weeks.

While there have been some very successful, big rating dramas on TV like Underbelly and Packed to the Rafters, there have been many, many other Australian drama series that have debuted and disappeared without a trace — much like a character from Underbelly! There is no time to find and grow an audience. There is only an appetite for overnight success.

This is particularly significant for drama as quality Australian drama is very expensive to do and doesn’t fit into any profit‐maximising model unless, like an Underbelly, it is achieving extraordinary ratings. If Gordon Ramsay is going to attract the same audience as a local drama, you can buy the abrasive‐tongued Brit for less than 10% of the drama cost. Score one for the accountants over the drama department.

There have been significant levels of Australian content on commercial television because of the regulatory framework that accompanied the free‐to air television licence. It was a framework created in an era where there was oligopolistic provision of content — and few alternatives for advertisers. It is a regulatory framework many anticipate will be unsustainable in the years ahead.

I have already commented on the declining investment in news and current affairs. Now, much of the commercial current affairs programming is anything but serious or substantive.

The state of Commercial TV underpins the ABC’s funding arguments. Australians have been well served by free-to-air television for 50 years, delivering a strong diet of drama, documentaries, light entertainment, news and current affairs. With fragmenting audiences and serious debt obligations, there is now clear evidence the best years are behind us. It is a reasonable question to ask: without the ABC, who will tell the Australian stories that for decades now have reached every home; that have been part of our national experience, our national conversation?

The ABC — another known unknown

It is appropriate that I make reference specifically to where the ABC fits in here. Our funding proposal is based on the government meeting its commitment to adequately fund the ABC and significantly increase levels of Australian drama, documentaries and children’s programming. We can deliver as the market fails ‐ it is one of the reasons we were established. And we have a track record of innovation, quality and audience engagement.

Last year we achieved our highest audience share for ABC Television since people meters were introduced. The reach of ABC radio is at an all‐time high. With iView — we have launched Australia’s first internet television service. And the ABC boasts one of the world’s most comprehensive suite of on‐line services. Our message to Government has been pretty straightforward. In this world of media transformation, the ABC has a spring in its step and is coming through — delivering what it traditionally has done, delivering where others no longer can, but also reaching new audiences in new ways. We are leading Australia into digital television with ABC2 and introduced hundreds of thousands of Australians to podcasting. No other media organisation is doing more with user‐generated content or using the web more to encourage robust local content. In the year ahead we will see the creation of the country’s first major information portals for the arts, religion and for rural Australia.

And with more money, we will be able to do much more. Despite the dismal economic times, I have been heartened by a perception in Canberra that this unique transformation taking place in the media means the ABC is at an inflection point. We will either continue to be connected to, and compelling in, the lives of millions of Australians or we will be a heritage media outlet with a glorious past and a future path set for decline. Everyone I meet in government speaks with optimism and enthusiasm about the ongoing importance of the ABC and stresses this in light of all that is happening to others in the media landscape. I hope the dollars follow the noble sentiments.

Our argument to Government is not dissimilar to the arguments the Government itself is using around the national broadband network. The media is undergoing a revolution. We need to ensure that all Australians, no matter where they live — have access to high quality drama and documentaries; arts, religious and science programs; serious news and current affairs; specialist content; local content; the world from an Australian perspective; the stories of local communities told in local voices. We need a virtual town square — where Australians can come to listen and learn from each other — to speak and to be heard — a place for all our voices. Like the broadband network, the market cannot provide this, but we need to invest to make sure it happens. We cannot afford not to have it. And the taxpayers are willing to fund it — they think it’s important. They back the Government backing the ABC.

History gives us cause for optimism. As our Chairman Maurice Newman noted at the ABC’s 75th birthday celebrations, the broadcaster was born at a time of epic change. 1932 was the year in which Phar Lap died, Jack Lang was sacked and the Sydney Harbour Bridge opened. The Great Depression was at its peak. Amid the turmoil and distraction, the ABC was created — a product of bold and innovative thinking. The same thinking is needed to propel the ABC into a new era.

Until then, though, the fate of the broadcaster is a known unknown.

Grounds for Optimism?

All of which can sound a bit bleak. Trying to find grounds for optimism through all of that is a bit like saying “If it wasn’t for the hundred year war, it would have been a great century”.

But despite all the change and turmoil, let me conclude by paying due recognition to some of the wonderful things that are happening with this media revolution.

We all benefit from the opportunity Web 2.0 technology gives to audiences to contribute to the media experience, not just consume it. When I edited newspaper editions, I would start the day when it was dark, reviewing my own paper and checking the competition, listening to the radio, watching TV bulletins — and coming up with lists of story ideas. Mostly, they were lame and I knew that if they made the next day’s edition, it wasn’t a very good day at the office. Our reporters were much closer to what was going on.

And of course, the people who really know the news — the eye‐witnesses to the crime, those who attended the crucial meeting and those who read the supposedly secret document — were all in the audience.

This new “Citizen Wayne” media landscape makes it far easier for the expertise of the audience to be injected into the news process. We have seen it already. The first photos published on the London underground bombings were taken by commuters on the train. We read Twitter reports from Mumbai hotels and by someone on a boat on the Hudson River when a plane touched down on the water.

That is not to say that we don’t need teams of specialist investigative reporters — or that media organisations should publish first and check the facts later. At the ABC we have recently developed new guidelines to ensure we keep our standards high as we use increasing levels of user‐generated content. The access to the swirling mix of photos and video, expert opinion and commentary created by an audience that is no longer passive but wants to be a participant in the media process — it’s a challenging thing for media organisations to manage. But it can only be a great positive overall.

Also positive is the innovation in technology that makes it cheaper, easier and quicker to get to stories and relay them back to audiences. We can cover the world now — from wars from behind enemy lines to natural disasters, coups and revolutions. All delivered with technology that is small and portable and useable everywhere. Making what we can see on our screens, immediate, real and compelling. It is not just in news: this kind of technology leads to breakthroughs in the way programs are made from a natural history documentary to the latest escapades of The Chaser (currently in production).

It is not just bringing the world closer. We can see the prospect of more engaged and informed local communities, with local citizens creating and growing hyper‐local media outlets, giving creativity a place to flourish, allowing more voices to be heard and linking people together.

This revolution means you can exercise your media choices at a time you want, on a device you want, wherever you are. You are no longer held captive by the clock and the schedule. You are no longer camped in the living room or cursing the late train that made you miss The Gruen Transfer. You are now in control.

The good news for those who are currently studying all this is that you arrive equipped for the new revolutionary order. The skills that many of our young new recruits possess when they first join the ABC are impressive. By working with our seasoned journalists and taking advantage of all the opportunities the ABC has to offer they are destined for impressive careers.

In years to come, young people will be amazed when you tell them that it was virtually impossible to read a copy of The New York Times in Melbourne, or, that if you got home at ten past seven you had no hope of watching the news that night; that you couldn’t view catch‐up TV from your phone on a bus; that you would have to wait days to see footage of a major world event.

Moreover, that five television channels were seen as enough; that a TV programmer would decide what you could watch; that a newspaper editor would decide what you could read. And that unless you convinced a journalist to tell your story, you had no effective way of having that your story told; that if you wanted to check facts, you needed to leave home, go to the library and look up books that would often themselves be out of date.

That you couldn’t keep your entire music collection and favourite TV programs in your pocket.

That there was so much to know and see and watch and understand — and that you had so few opportunities to do any of it in those media dark ages where most of us have lived.

As media organisations struggle to adjust to this revolution, as we lament some things we value that may be lost, as we struggle to understand the things we don’t yet know; we shouldn’t lose sight of the fact that this media revolution will be profound and transforming and empowering. Chairman Mao commented that ‘revolution is not a dinner party’. Australia’s media is discovering that to its pain and often bewilderment. But it is a remarkable ride to an extraordinary place.