Media essays

Government Granting Content Control to Media Proprietors
By Erin Cassar (2003)
The Australian commercial media is one of the most influential sources on the views and opinions of the Australian public. Legislation governing media ownership in Australia has been under public scrutiny for almost a decade. Even the government has labeled the laws ‘anachronistic’ and is encouraging a reform to relax them. But does the answer to the future credibility of Australian media lie in placing more power in fewer hands?
Visit the Australian government website and you will read that the purpose of Australia’s media ownership laws "is to encourage diversity in the ownership of the most influential forms of the commercial media." Ironically, according to australianpolitics.com web site "ownership of the Australian media is one the most highly concentrated in the world," with plans to make it increasingly worse.
CURRENT LEGISLATION
Laws pertaining to ownership of Australian media aim to restrain any single media proprietor or company from investing and controlling too much of Australia’s commercial media, which consists of the daily press, free-to-air television and radio. They also restrict foreign investment and ownership of our media entities.
Cross media ownership laws are controlled by two parliamentary acts. There is the Broadcasting Services Act 1992, which governs electronic media and the Foreign Acquisitions and the Takeovers Act 1975 combined with the Trade Practices Act 1974 which together control print media ownership.
The overall agenda of the existing regime is to prevent the common ownership of major newspapers, television stations and radio broadcasting licenses that serve the same city. The laws exist to encourage diversity in the ownership of Australia’s three most influential forms of the commercial media: the daily press and free-to-air television and radio. The legislation also strives to maintain this diversity of ownership to ensure public life is reported objectively thus assisting our democratic society in functioning effectively.
Present applicable law prohibits any person or group of affiliated people with a commercial television or radio broadcasting license from owning more than 15 per cent of a print publication released four days a week. However if the majority of the publications readership is external to the commercial television or radio licensees broadcast area, then ownership of greater then 15 per cent is permitted. Likewise a newspaper proprietor is restricted to a five per cent investment in a television license within the same area. The Act also prevents foreign investors from owning more then 30 per cent of national and metropolitan newspapers.

WHO OWNS WHAT
Currently in the Australian commercial media industry there are three major monopolies which dominate the media field.
News Ltd is an Australian subsidiary of News Corporation and in addition to its mass ownership of global publications, it boasts an elaborate portfolio of investments. News Ltd owns:
- Close to 70 per cent of the major daily newspaper market in Australia
- Almost 50 per cent of Australia’s suburban market
- 23 per cent of regional papers
- A 25 per cent stake in Foxtel (pay TV)
- Investments in AAP Information Services, a newsagency that feeds news and information to press
- Investments in News Interactive (online)
Fairfax is another major media player in Australia whose Chairman is Mr Brian Powers. This Australian publishing group has a collection of media assets that reads as:
- 21 per cent of major daily newspaper market in Australia
- 18 per cent of Australia’s suburban market
- 15 per cent of regional papers
- Investments in AAP Information Services, a newsagency that feeds news and information to press. (jointly controlled with News Ltd)
- Three magazines
- Fairfax Interactive Network (online)
The final media entity to complete the ‘big three’ of Australian media monopolies is Publishing and Broadcasting Ltd (PBL), an Australian media and entertainment company. The Chairman of PBL is Mr James Packer and the largest shareholder is Consolidated Press Holdings (Mr Kerry Packer). Its range of holdings include:
- The Nine Network
- The magazine publisher Australian Consolidated Press
- Controls 3 metropolitan television license and one regional television license, providing it with a 51.5 per cent reach of the potential audience.
- Has a 25 per cent stake in Foxtel (pay TV)
- Has a 33 per cent share in Sky News
- Publishes over 65 magazines thus reaching a 41.5 per cent share of the circulation from the top 30 Australian magazines.
- Shares online enterprise ninemsn with Microsoft Corporation
Source: http://www.aph.gov.au/library/intguide/sp/media_regulations.htm
In addition to these there has also been much speculation on Telstra and its intention to spill its services into the media industry. The proposals would see the government owned company "become a major player in content ownership and creation," according to the submission by the Media, Entertainment and Arts Alliance. It has been suggested that Telstra would control the Fairfax group or the Nine Network, resulting in Fairfax being a government owned print company. This would not be in the public’s best interest as it would make Telstra both carrier and content owner. A stronger interest and financial focus on news is all it would need before this communications giant became another very prominent source used by Australians to obtain daily information.
THE GOVERNMENT’S PROPOSAL
The Australian Government recognises the way current regime restricts the growth and development of the ‘old’ commercial media, whilst leaving newer media forms like the web untouched by restrictive legislation. At the last election the Australian Government committed to a reform of the current laws, due to the global media developments we have experienced since the regime was introduced. The Government has since kept their word by releasing the Broadcasting Services Amendment (Media Ownership) Bill 2002. The proposed Bill seeks to repeal existing legislation on foreign ownership and allow exemptions from cross media rules in compliance with government suggested safeguards.
This means a media company could control a combination of print, radio or television provided they had separate editorial controls, newsrooms, news compilation management and reporting.
The current Broadcasting Services Act amended the Broadcasting Act 1942. According to the Minister for Communications at the time The Hon. Michael Duffy, the cross media rules aimed to "support competition policy, discourage concentration of media ownership in local markets and enhance public access to a diversity of viewpoints, sources of news, information and commentary". Sixty years on, Senator Richard Alston, the current Minister for Communications declared his disapproval of the current laws in a speech to the Australian Broadcasting Authority (ABA). "We have an ownership regime designed for an age when our media choices consisted largely of newspapers, radio and television," thus suggesting a much needed reform.
Another reason the Government may consider a reform is for the content the existing regime fails to cover. Currently in Australia 50 per cent of households are connected to the Internet, while pay TV reaches one quarter of the population. This is a major concern for the current legislation as it fails to focus on these alternative sources of information, which the Australian public frequently use and some even depend on. It is interesting to note that the most trusted news sources are all affiliated with the big three media entities. Ninemsn, which is associated with PBL, F2 Fairfax’s Internet resource and News Interactive, which News Limited has investments in. This highlights the need for legislation governing Internet ownership.
Current laws also ignore any governing acts to protect the ownership of digital television, a medium that is predicted to have great influential power once widely accepted by Australian households. Whether this prediction is accurate or whether it follows the trend of the Internet where there are many voices but most of which are not listened to, remains to be seen. Perhaps, again like the Internet, these well established media moguls will dominate this area also should legislation pertaining to digital TV fail to be introduced.

WHAT THE EXPERTS SAY
The concern of the influential power of Media is an old one and was raised, not for the first time, in a report of the 1962 British Royal Commission on the press. The report stated "The obvious danger of concentration of ownership lies in the possibility that variety of opinion may be stifled if one proprietor comes to control a number of newspapers which formerly presented varied and independent views. The greater the number of newspapers which are governed by same editorial policy the greater is the danger." Allan Brown, co-author of Do We Have Too Few Media Proprietors in Australia? states this argument proposes that "in a pluralist, democratic society the structure of media industries will be improved by a greater number of independent owners. This is because they will probably represent a wider range of opinions, values and attitudes."
This importance of diversity of both opinions and news to the Australian public can not be underestimated. In order to attain a variety in news and commentary in Australia there must be stronger legislation then that proposed in the 2002 Bill. Peter van Vliet, Advisor to the Shadow Minister for Communications, Lindsay Tanner agrees suggesting that repeal on cross media ownership laws "will reduce the level of media diversity in Australia as there will be too few voices getting through to the Australian public."
However, Senator Alston strongly believes a reform is essential. He states "current cross media rules confine traditional media in Australia to their own little boxes, preventing them from pursuing business strategies that reflect new media realities." Alston has suggested that a revision of current legalisation will be the key to the future of Australian media companies. He says "If Australia does not modernise its media ownership regime, these companies will stagnate and be forced to resort to the only option available to them in an increasingly competitive marketplace namely cutting costs."
It is also Alston's view that as a result of this cost cutting Australian media will lose the attributes that its readers/viewers uphold most. He adds the demise of "quality programming, local news and information, diversity of opinion and an emphasis on innovation" will occur if cross media rules remain in place. But will the proposed legislation, which allows for the expansion of media empires, help Australia attain these very values? Local news will be threatened if foreign investors dictate our media content and diversity of opinion will be difficult to maintain if media corporations are encouraged to expand, thus ruling out competition and variety of news sources.
THE POWER OF ONE
In Australia it is commonly believed that the larger proprietors of media empires exercise their power over the editorial decisions that control their publications. If anything evidenced the dictatorship that media magnates have over the content of their entities, it was the strategic reporting campaign Rupert Murdoch led just prior to the first blasts of the Iraq war. By announcing to the Bulletin (a Packer owned Australian weekly publication) his pro-war stance he enslaved his entire media army and all its publications to reporting this war with a view much like his own. As chairman and chief executive of News Corporation, his puissant pro-war views would soon be shared internationally by his employees at least if not his readers eventually. With his words "we can’t back down now…I think Bush is acting very morally, very correctly and I think he is going to go on with it," came the prescribed opinion of all 175 Murdoch owned publications spread across the globe.
News Ltd publications dominate the print industries in Australia, Britain and New Zealand, so Murdochs signatory statement came as some what of a surprise with majority of both Australia and Britain’s population voting against military action without UN support. In February 2003, according to a survey conducted by The Australian, 76 per cent of Australians were against an Iraq war without a UN sanction. A poll in Britain also found that 58 per cent disapproved of Blair's Iraq policy.
However Professor of Journalism at Queensland University of Technology, Michael Bromley believes the decisions of what goes into a print publication is based on more then proprietors views. He states "what lies beneath the differing editorial positions of mastheads is not just a proprietor’s politics or an editor’s whimsy but a strategic targeting of different readership groups." He adds, "I suspect in some cases it is quite cynical. It’s what is going to sell us newspapers? What is going to get us attention?" Coincidentally Murdochs view on the Iraq war was in definite line with this notion as his seemingly parochial publications all reported with similar style. Murdoch publications wrote:
"Saddam Hussein deserves to fall…"(Melbourne Herald Sun)
"Snap missile strike to try to kill a dictator" and "We will stand up to evil invaders" (The Adelaide Advertiser)
"The tyranny of Saddam and the danger to innocent lives demand the world responds" (Sydney Daily Telegraph)
"The end of a tyrant" (The Australian)
van Vliet describes this pro-Bush style reporting as "a classic example of the way media proprietors influence news and opinions and influence their readers." By orchestrating his media ensemble to sing the same song, Murdoch provoked anti-war nations whilst stroking the patriotic ego of the US. He struck the perfect balance among his readership markets, selling papers both by interest in the military debate and by detestation of his stance. Provocation was the key to Murdochs reporting of the Iraq war as it stirred active and emotive responses, both of which sold his papers.
Murdoch had his reader’s attention and as we moved closer to the war, the Howard Government had gathered stronger Australian support. A Gallup International survey
revealed that the number of Australians opposed to an Iraq war had fallen to 59 per cent in February. It was also found that 64 per cent of Australians supported a war with UN approval. By the first stages of the battle a large majority of Australians were supporting our troops (pre-war figures found only 6 per cent initially supported sending our troops to war) and some even military action Iraq. Could the attention seeking campaign of Murdoch have influenced an entire nation? It is difficult to measure but definitely not worth overlooking.
WHAT THE FUTURE HOLDS
The risk of the Bill currently before Parliament is that it will increase the concentration and monopolisation of Australian media, which would then lower the diversity of news and opinion available to the public. Tom Nilsson, who made a submission to an inquiry into the Broadcast Services Amendment Bill 2002, claims "this legislation, if passed, will significantly weaken democracy in Australia. It is anti-democratic. He adds, "Having a diversity of media ownership is absolutely critical to democracy." His emphasis on the need for diversity in relation to the proper function of democracy makes sense particularly when we come to understand the influence of mainstream media. van Vliet explains "Australian commercial media to a large extent shapes the viewpoints of its readers and listeners. That is why it is necessary to have cross media ownership laws." This being the case, weakening our laws will ultimately pose a serious threat to the future of Australian democracy.
However Alston, a supporter of the Bill, argues that it responds to the global changes the world has seen since the introduction of the cross media rules and foreign ownership restrictions. He says "The Bill responds to these changes by putting in place a new regulatory framework for media ownership encouraging competition and innovation and at the same time ensuring consumers continue to have access to a diverse range of media services…." So this is what the Bill promises to do but there seems to be no mention of how it aims to do it. The Bill is loaded with solutions that simply do not match up with the problems they aim to ‘reform’. The clearest example of this is the threat to diversity which the government aims to amend by removing the cross media rule thus giving proprietors greater power across a wider range of media.
While the pros and cons of the Bill are widely debated, there is one change that must take place. No matter which way the government’s decision falls, one thing is certain – current and future legislation must be effective under all circumstances. In the past, current legislation has failed itself since its existence and if future laws follow in this direction, they too will face the public dissection that the current regime has. An example of ineffective legislation comes again from the media mogul Rupert Murdoch. He defied current regime by controlling approximately 70 per cent of the major daily newspaper market in Australia, despite him being a US Citizen. Therefore he is in breach of the law pertaining to foreign investors being limited to more than 30 per cent of a major daily publication. This highlights the lack of strength in current legislation and creates doubt about the effect of future proposals.
The second example challenges proposed legislation and involves the government funded Australian Broadcasting Association. The ABC has already merged their television and radio newsrooms in an attempt to cut operating costs, thus defying the safeguards suggested by government. This case sends a highly contradictory message to media companies as the government has defied a safeguard regime that it has now suggested be future ruling.
This example of the ABC merging resources is a concept known as ‘economies of scale,’ which is another issue of concern associated with the current Bill. Media proprietors claim that by pooling their resources into the one company, they can increase their profits and pass on these benefits to their audience by improving the quality of their output. However studies show that any such benefits from these financial savings are usually felt by the media corporations alone, while the quality of their output remains unchanged.
Guy Dunstan of financial institution ABN AMRO recognises the financial benefits for media corporations adopting the economies of scale concept. He states "There are advantages for newspaper and television stations being together in the same market. It makes sense to move assets together for critical mass and a better cost structure." However he paints a very real picture on the outcome this will have on the Australian public. Dunstan says the public will be ‘listening to your radio stations at breakfast, reading your newspapers throughout the morning, on your radio stations again at drive time and then your TV station in the evening." It seems this concept has a one-way theme. Give and give and give and to the media conglomerates and be brainwashed by their news, thoughts and opinions.
However van Vliet argues "there is nothing wrong with media companies becoming large as long as they don’t dominate one particular company or country." He adds "News Ltd is a great example of a successful media company. We just don’t want them dominating our media." The pro-Bush Murdoch led campaign combined with his 70 per cent reach of the Australian major daily-newspaper audience is evidence enough to recognise that our news is dominated by large media corporations, therefore current regime is not working. van Vliet says: "the legislation needs to be changed. There needs to be greater diversity in TV, print and radio but the emphasis should be on diversity of ownership not concentration of ownership."The future of Australia’s cross media ownership regime is indeed in question, and as always, the solution will satisfy some and overturn others. Whether media ownership laws are changed, repealed or abolished, the future effectiveness of legislation must be strengthened. If media empires expand even further, the credibility of our news will be threatened. But while the business focus has been on whom can own how much of what, the publics perspective and need for diversity of ownership has been overlooked. This is what future legislation must consider first and foremost when amending current regime. Diversity of news will derive from diversity of ownership, which is essential in an industry, which has one of the strongest influences on the views and opinions of its democratic public. We can not be sure which way the Government’s decision will go, however a solution to the existing problems will not be found in offering more media to fewer corporations.

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