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Conroy’s Sad and Confused Mess

Those much talked about media reforms – the ones we have been concerned about since the Convergence Review and Finkelstein inquiry have finally surfaced from cabinet. Well you cannot really say they have surfaced, but rather we have some detail and a bunch of cryptic clues, some fill-in-the-blanks as to what the exact policy of the Gillard Government, and Communications Minister Stephen Conroy might actually look like. We even have a very ambitious and quite frankly ridiculous timeline for the passage of the required legislation. What we can ascertain is that the proposals look pretty ugly. It’s really a mess, the whole thing.

The reforms announced by Stephen Conroy include previously outlined local content requirement changes and the related permanent reduction in licensing fees for commercial television stations. Among the more controversial proposals is the inception of a so-called “Public Interest Media Advocate”, which would oversee the operation of the Press Council and have a say in mergers involving media corporations.

The whole thing is a complete and utter joke. After years of struggling in the polls, someone has to be blamed for the woes of the Labor Party and God forbid it be them taking a good hard look at themselves. No, instead Senator Conroy thinks that messing with the media is the one true answer to all the government’s problems.

For a start,  beefing up local content rules, despite how nice most broadcasters are being about them, is a stupid idea. Essentially it is outsourcing a chunk of the production decisions of each television broadcaster to the government. There is good local content out there, but if we continue to up the minimum amount of airtime given to local content, then viewer numbers will automatically drop away. Not all production companies are capable of a major success such as MasterChef or Underbelly and even the former was not an Australian concept in the first place. Decreasing program competition, any competition, never leads to a sound outcome.

TV stations will, for the most part, wear the new local content rules. Why wouldn’t they? They are, after all, set to receive a 50% discount on their licensing fees and permanently too. Of course companies would want to reduce costs as much as possible and that inevitably goes for those bringing us news and entertainment on the tube.

By far the most troubling concept is that of the Public Interest Media Advocate. The name alone should be warning enough that there is, at the very least, a subtle attempt to control media coverage on the way. People have been asking: what exactly is the public interest? Nobody can actually say. Even the minister with ‘communication’ in his title cannot actually explain that one, let alone why such a body is necessary.

And what about this idea about the advocate policing mergers? Hasn’t the Labor Government discovered we already have a regulator? They’ve blocked contentious merger attempts before. Why a new bureaucracy to achieve the same purpose? Only Labor would contemplate that.

The thing with companies though, is that they either respond to or think they can create markets. Media businesses are no different. They are doing one or the other, so the media landscape will only ever be as diverse as the public wants it to be. And if people are concerned, then they, like all proprietors in all fields – can take an entrepreneurial risk.

Stephen Conroy is kidding himself on the deadline for passage of the legislation too. It simply beggars belief that a package with so little detail will be given so little consideration. Then again, maybe this is an attempt to look tough on the media, leaving it up to the minority parliament to possibly vote down the legislation. But if this is true, the minister now has enough egg on his face in simply announcing intentions to pursue media reform.

A child could not have made so much of a mess if they tried their hardest to do so. Governments simply need to learn that their interference in our lives is often not welcome. Most people are rational and can make up their own minds about, well everything.

Early Convergence Commitments and More On the Way

On Friday Communications Minister Stephen Conroy released the first elements of the Gillard Government’s response to the Convergence Review. The review was set up by the Labor Government in order to respond to the changing media environment which has seen the introduction, within the last two decades, of digital media sources.

Initial policy responses include a decision not to allow a fourth free-to-air commercial television network and the extension of the broadcasting licence fee rebate which will eventually lead to a permanent reduction in fees levied. Further, Senator Conroy also announced that the ‘75% rule’ would face the parliament. And finally, the minister announced a change to local content rules.

The Gillard Government has decided that a fourth free-to-air commercial television broadcaster will not be sought by the government, at least in the short-term. However, the possibility of a sixth broadcaster has not been ruled out completely.

In the meantime, community television will be allowed to broadcast on the spectrum not made available for a fourth network until at least the end of 2014. This means two more years of without the prospect of another television station.

In terms of certainty for existing networks, this decision is positive. It means market share will not be as hard to maintain as it would be in the event of another competitor in the field.  But at the same time it is a loss for competition.

Existing television stations have been granted another reprieve by the Minister for Communications. Their broadcast licence rebate will be extended for one more year. After that 12 month period has passed, licence fees will drop to just 4.5% of revenue, a 50% decrease.

This move can only be seen as a positive, decreasing the costs associated with operating a television network.

Perhaps the greatest outcome, at least in theory, is Senator Conroy’s announcement that he would seek parliamentary approval for the removal of the ’75 percent rule’. This rule dictates that no one person can control broadcast interests which have an audience reach of more than 75% of the population of Australia.

The change will have to make it through parliament, but that would seem a fait accompli, with the Liberal and National Party coalition unlikely to block such a move by the Labor Party. The Greens will probably voice their opposition to the plain, but it will likely come to nothing.

Where the move on the 75 percent rule moves from great in theory, to very ordinary in practice is that it will be tied to local content provisions in regional areas. No business should have government effectively making major business decisions for them.

For this reason too, increasing local content obligations across the broader television media landscape is also a poor decision on the part of the ALP.

The primary channels of the TV networks will see their content obligations remain the same. They will be expected to broadcast 55% local content, a requirement imposed by the former Howard Government in 2005.

Under the new plans too, commercial television multi-channel broadcasters will have to show 730 hours of local content in 2013. In 2014 this will increase to 1095 hours. For 2015, the target will be 1460 hours of local content.

The new rules will provide what has been termed an incentive. If a network shows first-release drama on a digital multi-channel, then that hour of broadcast will actually count for two hours under the new obligations.

The so-called ‘incentive’ is silly and should not be used to sugarcoat what is a silly idea from government.

Television networks must be allowed full control of content and therefore their individual branding. All content should compete for transmission on a level playing field. Media companies will not always make good decisions, but to say that governments can make good business decisions for broadcast media companies, which they are actually doing through content requirements, is an exercise in fantasy.

There are more changes to the media landscape flagged for 2013. How much more control of the media will the government seek in 2013?

Another Example of Getting Things Done Wrong

The Prime Minister often remarks, particularly in the parliament that her Labor Government are “getting things done” and the number of bills passed obviously does bear out this argument, although this does equal more regulation and “red tape” for business and the individual. It can also, by implication mean that policies and programs are being rushed and established processes not being followed correctly as has been alleged on a number of times over the period of both the Rudd and Gillard Government’s.

This argument is also borne out in the case of the Australia Network tender process which was deeply flawed, rushed, changed and awarded to the ABC in perpetuity despite recommendations to the contrary.

Today the Auditor-General released a report into the botched tender process which does not make for good reading for a government that is trying to gain a foothold to climb the gap that exists in the polls just under 18 months out from the next federal election.

The tender for the Australia Network was for a $223 million contract to broadcast news content overseas, an important form of what is termed “soft diplomacy”- in short, displaying through various media the Australian culture, values and policies which we think will make our nation an attractive place to continue to visit and conduct business with.

Initially, the process was under the purview of the Department of Foreign Affairs and Trade and its minister at the time, Kevin Rudd, with departmental recommendations saying the government could extend the ABC contract or put the contract out to tender, with the department arguing to keep the contract with the Australian Broadcasting Corporation.

The Minister for Foreign Affairs subsequently decided that the contract should be put to tender, with the winner of the contract granted a long contract to provide the news service.

The audit found that before the tender was awarded, that both the Prime Minister’s office and that of the Communications Minister, Senator Stephen Conroy were aware of which party would win the tender.

Then the weirdness escalated- the government began seeking advice as to whether the final nod of approval could be transferred to the Communications Minister from the DFAT Secretary Dennis Richardson and it was.

The tender then underwent significant changes and the leaks began in earnest. These leaks revealed that twice the tender board recommended Sky News be awarded the contract. They were not.

The Government walked away from the tender process after the leaks were reported in the press and then proceeded to award the contract permanently to the ABC which had previously been the broadcaster of the Australia Network.

This flawed process could legitimately be seen as both a symptom of a government in trouble politically and electorally, floundering in the polls and trying to rush to “get things done” and also as a result of a toxic relationship between Prime Minister Julia Gillard and former Minister for Foreign Affairs, Kevin Rudd, whose department should have had the final say on the award of the sizeable contract.

As a result, the government have had to pay compensation for a failure in managing a process and even managing internal relationships between MPs who should be seeking to achieve the same ends regardless of conflicts in personality. Not only that, but the ALP Government have added another failed process to the list of mistakes only adding to the poor perceptions of Prime Minister Gillard and her MP’s.

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