The Idiot’s Guide To The New Media Ownership Laws

The Idiot’s Guide To The New Media Ownership Laws
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Did you hear all the talk of the new media ownership laws over the weekend but, quite frankly, still not have the foggiest clue what anyone was talking about?

Well, fear not! Here, B&T answers all your totally obvious questions about the changes announced by the communications minister, Mitch Fifield, on Saturday morning.

You can read Fifield’s full statement here too.

What was the big news over the weekend?

Arguably the biggest news to come from Fifield’s announcement was the abolition of the licence fees for the free-to-air networks. That means Seven, Nine and Ten will no longer have to pay around $130 million a year in fees to the federal government, to, basically, run their networks.

Why’s that good news?

Two reasons. One: the networks claim their new overseas disruptive competitors – the likes of Netflix, HBO or Google – don’t have to pay licence fees in Australia, so why should they? Rightly or wrongly, Seven, Nine and Ten argue they can re-invest those monies back into homegrown TV and drama which is good news for actors, screenwriters, producers and the likes.

So the free-to-airs get a $130 million kicker at the taxpayers’ expense?

No, in lieu of the existing licensing laws, the new rules state they must pay a “new annual spectrum fee of $40 million”.

Why are network bosses whinging about Facebook and Google?

Multiple reasons. One (they argue) they don’t think they pay their fair share of tax in Australia and, two, they pinch content from Australian publishers and don’t have to pay for it.

Do these reforms fix that?

Not really. There’s still a long way to go and expect more from Scott Morrison’s Budget this week.

Was that all?

No. The new rules also aim to repeal the “two out of three law”. In the past, a media company could only own a TV station, a newspaper business BUT NOT a radio station in the same territory. IE, Fairfax could own The Sydney Morning Herald and Macquarie Radio stations in Sydney, but the laws meant it was illegal for it to also have ownership in, say, Channel Nine or a third media outlet.

Why’s this a good thing?

Well, it’s a bit of a double-edge sword, really. One: it will make media companies far more attractive to investors – particularly to cashed-up overseas ones. Sure, that means more money for media companies; however, there’s sure to be a lot of mergers and acquisitions, too. Expect a lot of new mergers, a lot of content sharing between the two, and, very probably, staff redundancies to boot as competition shrinks.

What was the “75 per cent reach rule” and why’s that been scrapped?

In its simplest form, the rule (harking back to the early 80s) said broadcasters and publishers could not reach more than 75 per cent of Australia’s population with their content. However, with the advent of the internet and downloadable video the law was pretty much redundant some time ago.

Any other winners?

Well, there’s a $30 million carrot for broadcasters – namely Pay TV – to broadcast more women’s sport. And, although details are sketchy, the anti-siphoning laws are to set to be relaxed, too. That means pay TV providers – namely Foxtel – could bid for the rights to things like an Ashes series or the Melbourne Cup (events deemed “culturally significant”) and typically given to the free-to-air networks first. Result – pay TV providers will be able to bid for more sport and charge you, the viewer, accordingly.

Are the new laws set in stone?

No! Any reforms will need to be passed by the Senate. Both Labor and the Greens have said they won’t vote for the changes, meaning the federal government will need to rely on Nick Xenophon and One Nation to get them through. However, it now looks like – with the support of the three Xenophon senators – the bill would, most likely, be passed.

What got Xenophon over the line?

The South Australian senator is a staunch anti-gambling crusader and, to secure his senate vote, the new media ownership laws mean there’ll be no gambling advertising during sporting events before 8.30pm (until after the kiddies go to bed).

But that will cost the free to airs $130 million a year in ad revenues?

You’re right. But even they’re worried about the proliferation of gambling ads and the negative feedback from audiences. Plus, the relaxation of the ($130 million) licensing fees should ease some of the network’s pain.

These changes all sound pretty obvious. Why’s it taken so long to implement?

It’s (A) not been a huge priority for the government and (B) the new changes are fundamentally (and remain so) opposed by Labor and the Greens.

Why are Labor and the Greens so pissed off?

Well, it’s their job in opposition to oppose most things. That said, there are parts of the Coalition’s package that Labor are on board with; the “reach rule” as an example. Ultimately, Labor argue the new rules will create big, behemoth media companies, creating a lack of diversity. Also, regional newsrooms could be devoured by their city cousins, leading to job losses and the loss of a local “voice”. The Greens are also fundamentally opposed to the abolition of the “reach rule”.

Will the changes get passed by the Senate?

Probably. The government has worked very hard on shoring up “the numbers” before announcing the final details over the weekend.

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