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Oct 14, 2014

ABC’s flagships could be sacrificed to fund online future, warns Scott

Efficiency savings might be achieved without program cuts, but if the ABC can't use them to fund innovation, it'll have to cut into programming anyway, Mark Scott said in Melbourne last night.

To remain relevant for the future in an age of diminishing funding, the ABC had no choice but to cut into its programming, the ABC’s managing director Mark Scott told an audience of academics and media insiders in Melbourne last night.

In a fiery speech, Scott blasted the government for cutting funding in the middle of the ABC’s triennial funding agreement, despite a promise not to do so delivered before the election. He said the ABC had no choice but to invest in mobile and digital technologies, but that a crucial source of funding for this was drying up:

“In the past, efficiency savings have allowed us to meet emerging audience content demands. In future, that source of innovation funding will not be available to us — we’ll have to return those efficiency savings to Canberra. And that’s a very real opportunity cost for a media organisation which is Charter bound to be innovative.

“What options do we have, therefore, to meet this reinvestment challenge? The funds must come from elsewhere within the organisation, particularly content.”

That comment has been widely seen as a rebuttal to Communications Minister Malcolm Turnbull’s arguments on programming and ABC funding. Two weeks ago, Turnbull wrote a blog post where he said the ABC’s claims that budget cuts were forcing it to cut programming were “not credible”:

“It is wrong to attempt to draw a link between budget cuts, back office savings and decisions made by management about programming. Suggestions that popular programmes or services are at risk because of Budget savings are not credible. The savings sought from the ABC are not of a scale that will require reductions in programme expenditure. The ABC may choose to cut programming rather than tackle back office and administrative costs — but that’s the ABC’s call.”

Scott said he’d hoped by this time he would know how much the ABC was being cut by. “Being unable to finalise our plans is frustrating for the board and executive, and particularly frustrating for our staff,” he said. “I believe we’ve been very patient and I’m sure you can forgive us, five months down the track, for wanting some certainty.”

“The one option we will not be considering is to shut down investment in online or mobile,” he said.

With diminishing funding, Scott said the ABC could either “step back in time” by scaling back its online and mobile presence — as advocated by critics such as the Institute of Public Affairs and Senator Cory Bernardi — or it could continue its transformation for a digital age, giving up some of the mainstays of the past to fund the future. “The ABC management team are passionately committed to securing a compelling future for the public broadcaster, not just a glorious past,” he said. “The tradeoffs and choices are never easy.”

“The one option we will not be considering is to shut down investment in online or mobile,” he said.

Proponents of a smaller, analogue ABC believe this would solve the problems of commercial media, Scott said. It wouldn’t, he argued. “There may be a number of reasons for the woes of News Limited and Fairfax, but the existence of the ABC is not one of them. The problem isn’t that they don’t have enough readers, but that they don’t have enough revenue.”

The speech was the most heated given by the managing director on the issue of ABC funding since his media appearances on the morning after the budget. It comes as the government’s expenditure review committee decides on the quantum of cuts to the public broadcaster, believed to be in the range of 10% of the broadcaster’s funding.

During questions following the speech, Scott was asked whether he saw a future where the ABC didn’t broadcast terrestrially (i.e. using television and radio signals) as currently required by its charter. Such broadcasting currently sees 20% of the ABC’s budget sent to private supplier Broadcast Australia. Scott said as audiences migrated to the internet, there was certainly a growing demand for online content. But he hosed down any imminent change to the ABC charter to allow this potentially cheaper method of distribution to replace the current signal. “It’s really a long way away to say that as a consequence of [that demand] we’ll be able to turn off television,” he said.

Scott also defended recent appointments to the ABC board, saying in his experience the independent appointment process was working well. He welcomed the appointment of former Seven CFO Peter Lewis to the board, saying be brought a wealth of experience. Scott’s comments come despite ABC stakeholders like the CPSU and the Friends of the ABC saying Lewis’ extensive commercial television experience constituted a conflict of interest. Most of the ABC’s current board members have no direct experience in media or journalism.

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8 thoughts on “ABC’s flagships could be sacrificed to fund online future, warns Scott

  1. SusieQ

    So tired of commercial media whining about the ABC and glad to see some fightback from the CEO. Commercial media have sat back wallowing in old fashioned concepts while the ABC has moved ahead with fantastic digital content like iview- hence the whining and complaining.
    I believe the IPA receives funding from Murdoch, so you can where their reasoning comes from.
    How can a smaller, analogue ABC serve any purpose in the future?? Oh, wait…..

  2. CML

    The rAbbott and his motley crew seem determined to shut down any avenue that might criticise the government.In attacking the ABC, they may have bitten off more than they can chew.
    Many people just won’t accept the deep funding cuts to the ABC budget, which could change the face of the national broadcaster. Its ability to be the major source of information, news, entertainment etc., particularly for those in the bush, will be severely curtailed.
    Just more decisions by this government based on broken promises and straight out l+es.

  3. klewso

    All this because they’ve asked questions, raising the spectre of accountability from Limited News Party governments?

  4. Gavin Moodie

    Good to read of Scott’s robust position.

  5. Dan Erlberg

    LNP is confusing business with governance, value be damned it’s all about efficiency and revenue.

    So sick of this corporate governance everything-has-to-be slashed mentality.

  6. Simon Mansfield

    For those us that work in new media, there really is no need for the ABC to be in this space. There is no lack of diversity in new media, and all ABC Online does is set the stage for yet more advertising inventory to be come online – as has happened with the BOM and the millions of pages it has dumped in the Australian online advertising sector – using my taxes to compete against my privately funded business. iView is the one exception that the ABC should be able to do – as it is simply another medium to channel existing video/TV content through. But the Drum Online along with the whole ABC online print news service is highly questionable and should be closed down.

  7. Norman Hanscombe

    The ABC wasn’t established to mimic what could be obtained already in the commercial media, especially in low-brow culture which was more than well supplied already.
    Might those unable to see this might be best served were they to bask happily in the commercial media’s mists?

  8. GideonPolya

    The censoring, lying, Neocon American and Zionist Imperialist (NAZI)-perverted and subverted ABC could save a lot of money by stopping its practise of giving presstitutes from other Mainstream media huge additional exposure on programs such as The Drum, Q&A, Lateline, Breakfast, PM, AM etc.

    Sensible Australians have turned to the ABC as an alternative to these lying presstitutes (notable those of the Murdoch Empire) but the ABC has become just as bad as the rest for lying and censorship (for details and documentation see “Censorship by ABC Late Night Live”: , “Censorship by ABC Saturday Extra”: and “ABC fact-checking unit & incorrect reportage by the ABC (Australia’s BBC)”:

    For details of media-derived censorship by the global Murdoch media empire, Australian Fairfax media, the Australian ABC, the UK BBC, and the Australian universities-backed web magazine The Conversation in Neocon American- and Zionist Imperialist-perverted and subverted Murdochracy, Lobbyocracy and Corporatocracy Australia and elsewhere in the West see “Boycott Murdoch media”: ; “Censorship by the BBC”: ; “Censorship by The Conversation”: ; “Mainstream media censorship”: ; “Mainstream media lying”: ; “Censorship by The Age”: ; “Censorship by ABC Late Night Live”: , “Censorship by ABC Saturday Extra”: and “ABC fact-checking unit & incorrect reportage by the ABC (Australia’s BBC)”: , “Censorship by The Guardian UK”: and “Censorship by The Guardian Australia”: .

    Of particular offence to anti-racist Jewish Australians is how the censoring, lying, Neocon American and Zionist Imperialist (NAZI)-perverted and subverted, anti-Arab anti-Semitic and anti-Jewish anti-Semitic ABC applies sidelining, blocking, censorship and defamation to anti-racist Jewish opinion critical of the horrendous war crimes and human rights abuses of Apartheid Israel and of the US Alliance (deaths from violence or violently-imposed deprivation total 2 million for the Palestinian Genocide since 1936 and 12 million for the Zionist-promoted Muslim Genocide since 1990).

    2 great ideas for improving the the lying, censoring and PC racist (politically correct racist) ABC for LESS cost are (1) stop using Mainstream media presstitutes and (2) have a daily 15 minute segment on radio and TV that actually tells the Truth (if constrained by cowardice, libel laws or anti-terrorism laws the ABC could present the Awful Truth as text with the relevant Awful Truths blacked out).