Media essays

Muting The Voice: How Cross-Media Ownership Will Limit Diversity

By Perrin Brown (essay, 2005)

When the Australian voting public heard last October that the Howard Liberal Coalition had won a fourth term in office, with a clear majority in the Senate, the prospect of major changes to Australian society became more of a reality. Along with the possible full sale of the Government’s $31 billion stake in the telecommunications giant Telstra, the proposed bill to change cross-media ownership also resurfaced. Change is often a good thing, it breaths new life into an aspect of society that is looking dry and old. But as of July 1st  this year, if Howard’s planned changes to cross-media ownership come to fruition, Australia’s media landscape, especially within the production of news and opinions, will change dramatically and not for the best. Instead these proposed new laws will more than likely limit the diversity of Australia’s already complex media industry.

American media commentator Ted Turner made the following observation of the Australian-turned-American Rupert Murdoch’s media empire News Corporation: “I worry about how much control this man is getting…. Like the former Fuhrer, Murdoch controls the media for his own personal benefit – for money and power…. He thinks that his media should be used by him to further his own political goals.” This quote goes to show that there are possible ramifications of too much control of the media by one particular person or company. Margo Kingston, a Sydney Morning Herald journalist, pointed this out in 2003, when the cross-media ownership package was also presented to the Senate. Here she alluded to three main points on what may happen under deregulation of cross-media ownership. The first point detailed the fact that the Australian media would be dominated by Kerry Packer and Rupert Murdoch and that the ABC would be the only viable news media outlet that could – “if it dared” – subject either man to independent scrutiny. The second dealt with the building of these media empires. It is a publicly known fact that Packer’s PBL wishes to acquire Fairfax. Kingston believes that this would see the destruction of Australia’s sole remaining independent commercial media operator, thus signaling the loss of balance in our news and media industries. The final point dealt with internet news services being owned by the already existing media outlets.

However it is something worth mentioning, that when looking at cross-media ownership, we must remember that it is a proposed bill to change media ownership laws. Howard has stated in an interview with The Bulletin magazine that he will not perish politically just for changes to cross-media ownership laws. He believes there are other “top priority” policies on this terms agenda, such as “further industrial relations reforms.” Whilst this maybe the case it is still important to recognise the possible consequences changes to the cross-media laws may bring to Australia’s already complex media industry, as under any new laws, the voice of diversity in our media will be muted.

The Story so Far: A Cross-Media History.

In the 1920s when the American auto manufacturer Henry Ford dominated the auto industry, he claimed that “you can have any color you want as long as it is black.” Ford’s car company soon started to lose it’s strangle hold on the industry after this. Although an unrelated point to the cross-media debate, it highlights a known fact that in any modern society there is a general rule about the goods and services that are offered for our consumption, the fewer there are the blander they get. This is advice that The Age newspaper journalist V.J. Carroll has given to those in parliament in relation to changes to cross-media ownership. And it is this that the current rules are based upon, the idea that the more owners there are of Australian media the more diverse the media will be.  The passing of the laws we are now living under saw the beginning of a tumultuous seven year period of time for Australia’s media industry. This began in August 1985, when the then Labor Minister for Communications the Honorable Michael Duffy directed the Forward Department of Transport and Communication to undertake a study of the ownership and control rules for commercial television. One year later, in the August of 1986, the report Ownership and Control of Commercial Television: Future Policy Directions was released. This report made proposals for various options in order to limit the cross-media ownership of the nation’s media proprietors. On November 27th of that year, the Hon. Duffy issued a Press Release detailing the federal governments proposed changes to the ownership and control provisions of Australia’s commercial television licenses. In addition, cross-media restrictions were to be imposed which were designed to prevent a single person or company from controlling both a television license and a newspaper published more than four times a week and having more than 50% of it’s circulation in the same area served by the television licence. Up until this point in time, media proprietors could own television, newspaper and radio licenses in the same market. For example the Herald and Weekly Times (the then owners and publishers of Melbourne’s afternoon daily The Herald, and Melbourne’s morning daily The Sun News – Pictorial) owned Channel 7 (HSV7) in Melbourne.

However the ‘new’ cross-media laws were introduced, according to the Australian Broadcasting Authority (ABA) website, to prevent “common ownership of commercial radio, television or newspaper outlets within a particular market place.” Then Treasurer Paul Keating was quoted at the time saying that with the new media laws, current media owners could either be “Princes of Print or Queens of the Screen.” This basically meant that media owners had to choose whether to own newspapers or television stations, but that they could not own both. These changes were introduced in the 1987 Broadcasting (Ownership and Control) Act which was an amendment to the Broadcasting Act of 1942. There were then further changes to this Act in 1988. This saw the extension of limits on cross-media ownership to include radio licenses. Between the introduction of cross-media ownership regulations and the new complete rewriting of the legislation in 1992, the Act was amended on several occasions, and many media entities changed hands at least once during this time. One of the most noted changes was Packer losing the Nine Network, only to regain it shortly afterwards. Media companies across all sectors though, felt the financial pinch, this included the almost bankruptcy of Network Ten and the Triple M radio network (now owned by Austereo).

With that said, the 1986 carve up of Australia’s media pie ultimately had the primary aim of encouraging diversity in the ownership of Australia’s most influential forms of the commercial media. This was shown in 2001 when Mr. Kim Jackson, a researcher in the federal parliamentary library said that “[t]he justification for the rules is that the effective functioning of a democracy requires a diverse ownership of the daily mass media to ensure that public life be reported in a fair and open manner.” Why then does the Howard Government wish to change the current media ownership laws?

Reasons for Change.

Well, since the Liberal Coalition government regained power in federal politics in 1996 – after an absence stretching back to the early 1980s – John Howard and his cohorts have indicated that the current media ownership rules are “anachronistic.” In an interview with The Bulletin magazine in February, Prime Minister John Howard said that the existing restrictions on media ownership were “an act of hostility towards the Melbourne Herald [and] Weekly Times group and the then Fairfax group,” by the Hawke/ Keating Government. Howard also stated that he would like to “just get rid of the existing restrictions,” although he won’t perish politically just for changes. The Liberal Coalition governments, who have a strong history of believing in private ownership of public commodities and the private market place over the public market place, have argued since 1996 that the media industry should be treated in the same way as other areas of the economy. In other words they should be subject to competition regulation through the Australian Competition and Consumer Commission (ACCC). This means that Australia’s media industry would be run in an even more competitive market place, such as that which is seen in the Banking sector, for example with people looking for competitive Home Loan Interest Rates. Or even like the US media. Down To Earth magazine editor, Sunita Narain, commented on the American media in April this year as a media “business model,” whereby its owners “owe their allegiance to the profits of their shareholders.” She claims that since deregulation of the American media industry in 1983, the rules of the market place have prevailed in the US media. “In 1983, 50 corporations comprised the US media; by 2004, five” corporations owned the American media.

Whilst the opening up of the media market to more competition is one argument for change, the Prime Minister has also put it down to technological change. This argument, which is often used by the major media groups, tries to show that technological convergence and changes in the information technology field, have rendered the regulation of Australia’s media unnecessary and obsolete. The major difficulty with this and the competition law approach, according to Jackson is that the merger provision of the Section 50 of the Trade Practices Act, while maintaining competition within markets, there would not necessarily be plurality and diversity maintained across the different markets. A further problem with this approach to cross-media laws is the web. Although it’s argued that the emergence of the web will be the future breeding place of diversity, this may not be the case. In figures released in 1999, and commented on by David Howell, it was found that “some 30 of the top 100 most popular internet sites are controlled by one of the two big newspaper groups, one of the three main commercial [TV] networks or the ABC.” When The Australian newspaper media commentator Mark Day, was asked in an email interview, why he believed there will be greater diversity in news services and opinions on the web, even with Jackson’s figures from 1999, he answered that “because there are very low barriers to entry on the web, and anyone (viz bloggers and podcasters) can publish their views or news. If their product is attractive enough (Crikey, perhaps?) people will return and maybe subscribe.” Day also believes that the major reason for Jackson’s findings in 1999 is due to the fact that “it is logical for news organizations to have web sites, because it leverages what they do for their other platforms. We tend to go to them because we know and trust their brands.” As of February this year, we have already begun to see the effects of cross-media ownership, although there has been no deregulation of its laws. This has been seen by the sale of the Australian independent journalism website, www.crikey.com.au. A website that was once considered to be an exception to the rule of most Australian news sites as it was not owned by an already established media outlet.

The Implications: Loss of Diversity.

Stephen Mayne, founder of www.crikey.com.au, sold the Dot.com site for $1 million, to a company called Private Media Partners, which is ran by Diana Gribble and Eric Beecher. Two owners described by The Age journalist Margaret Simons, as “determinedly independent publishers.” However this company is a part of Text Media, a Murdoch affiliated company. Because of this, a site that was once an independent online journalism site is now owned by the king of the tabloid news media. If cross-media ownership laws are changed, other similar crikey sites that exist, will also be quite viable for large media organisations, such as News Ltd., to buy them up so as no stories that would go against the Murdoch’s and the Packer’s of this world, would be published. Thus the age old press media saying of ‘news is something, someone, somewhere, wants to suppress.’ Problem is that under cross-media deregulation, that news would be suppressed, especially if it affects that media owner. This would also bear witness to the gagging of journalists and independent, diversity of reporting – the muting of the voice. For a site such as www.crikey.com.au the types of stories that this gagging may include are stories that take swipes at the Australian commercial media’s practices in journalism. Such as stories on chequebook journalism on Australia’s two rival current affairs programs – Nine’s A Current Affair and Seven’s Today Tonight. It will be interesting to witness over the coming weeks and months how fast stories such as this, begin to disappear form the Crikey site, now that Murdoch and his merry men indirectly oversee its editorial content.

In short, changes to cross-media ownership seek to remove barriers between who owns what types of media. Currently under Sections 60 and 61 of the 1992 Act, the same media proprietor is not allowed to own a major metropolitan newspaper and a free-to-air television station in the same market. For example Kerry Packer can not own the Nine Network and Fairfax’s The Age newspaper here in Melbourne, but if the rules under Sections 60 and 61 are changed, Packer would be allowed to own both. This has created the fear in journalism ranks and in the public in general, that Australia’s media will become a duopoly of two distinct groups: The Packers Publishing and Broadcasting Limited (PBL) and the Murdoch’s News Corporation (News Ltd. in Australia), with an ever weakening, and currently under funded Australian Broadcasting Corporation (ABC) on the outer. This would mean that under the proposed changes PBL and News Ltd. would largely decide what news; views and opinions, etc. are released to the public.

According to the author of Megamedia: How Giant Corporations Dominate Mass Media, Distort Competition, and Endanger Democracy, Dean Alger – “…analyst of the democratic process” and American advocate for free-speech in the media – states that a number of social science studies have shown that the media are powerful agenda-setters for the public and have a significant impact on a countries political processes. These studies, although mostly American, have found that around election time “the media are doing a poor job of providing citizens with information and analysis on policy issues and candidates’ qualifications, largely because news operations are increasingly focused on the political game, conflict and scandal-chasing.” Clearly then, as Alger highlights, “who owns and controls these powerful means of mass communication and how the media are used to convey or to distort or fail to convey – information and images is of critical importance to society in general and the democratic process in specific; the dialogue of democracy is especially dependent on these pervasive means of mass communication.” Changed cross-media restrictions would give the media more political clout than political leaders themselves. Russ Baker discusses this within relation to Murdoch and his swaying of the Chinese Government for his Star satellite TV networks expansion into China.

Australian Media Players.

In Australia, our media industry, not unlike the USA, is mostly made up of companies who hold controlling interests in casino’s, holiday resorts, business’, cinema chains and even movie studios.  For example, PBL boasts on its website that it’s “market capitalization of more than AU$8 billion places it among the top 25 companies in Australia.” The PBL empire, which was started by Sir Frank Packer, has its core businesses in television production and broadcasting, as well as magazine publishing and distribution, gaming and entertainment. PBL owns and operates the Nine Network; Australian Consolidated Press, the Crown Entertainment Complex in Melbourne and the Burswood International Resort Casino in Perth. It also has a 25% stake in subscription TV network Foxtel, and owns 50% of the ninemsn internet portal. News Ltd. on the other hand controls over two-thirds of the nation’s newspaper titles including the nation’s only nation-wide daily broadsheet The Australian. World wide News Ltd.’s parent company News Corporation is the “leading publisher of English-language newspapers.” The company alone prints more than 40 million papers a week. But Murdoch’s News empire doesn’t just deal in print. It owns a 15% share of the Seven Network, leading book publishers, movie studios, radio networks and up until its collapse 50% of Ansett Airlines.  In his adopted homeland of America, Murdoch controls the tabloid news channel Fox News Network – known for its bias in reporting of the 2004 US Presidential Election. Therefore what does this mean for Australians? Well locally it means that our news will be given to us in either a diluted format or not at all. For example if under media deregulation, Packer’s PBL owned Melbourne’s number one free-to-air television station (Nine) and the city’s number two newspaper (The Age) as well as Crown Casino, there would be a limited amount of news sources that would comment on issues and stories that would happen at the Casino. And it is very unlikely that a journalist at either the Nine Network, or The Age newspaper (unless they had a death wish) would comment on these issues. This shows that when these corporations own other business interests, there would be a ‘conflict of interest’ in what can and will be published/ or broadcast.

Possible Effects of Change: The Industry.

One way to see this is by looking at the effects of the repeal on Australian media markets, especially in Australia’s two major capital cities of Melbourne and Sydney. In Jackson’s 2001 brief on the possible changes to media ownership laws, he found that in Melbourne there will be a 60.0% reduction in the ownership of the cities media outlets. In Sydney there will be a similar reduction of 55.5% in the owners of its media. The question then has to be asked, what will the effects be on journalists? Under new media laws, journalists will bear the burden, because they are at the frontline in terms of what news and views the public are exposed to. Ultimately this will be through how news and opinions are reported. In 2003, Margo Kingston’s opinion piece, ‘Closing the Door on Your Right to Know,’ gave a personal account on what a journalist at a metropolitan daily newspaper, which could be taken over under the new media laws, sees as the possible consequences of cross-media ownership. This is best shown in a Post Script to her article, which states that “[t]he Fairfax board supports the cross-media bill. Because of the Fairfax commitment to editorial independence, I am able to express these opinions. Would I be able to do so if Kerry Packer took over Fairfax?” This also highlights another problem with change, which is that under new cross-media ownership laws the owners of those cross-owned media organisations are going to have the final say on what is let out to the public, thus restricting what a journalist can report on. This was seen in the UK when News Corp. took control of London’s The Times and The Sunday Times newspapers. Murdoch guaranteed both editors that they would have independent control of their newsrooms. Within a year of Harold Evans being appointed editor of The Times, he resigned saying that it was because of constant editorial interference from Murdoch. Although actual direct interference by media owners in Australia is few and far between – one memorable moment being Doug Mulray’s show being personally pulled by Packer after he made a telephone call to his Nine Network saying to do so – under changes proprietor interference could become more common. In an email interview with 3AW talk back host and Herald Sun opinion writer, Neil Mitchell, I asked him whether or not he believed that under new laws the media proprietors would have more control over his pieces. He replied: “you misunderstand media. Who owns the Herald Sun or 3AW will not affect my views or published opinions. As a professional journalist I live off my reputation. To alter my opinion according to my employer would be dishonest.” Mitchell also claimed that his material is not edited, “and were it changed to suit the political views of a proprietor I would exercise the journalists (sic) ultimate power and resign.” This may well be the case, and Mitchell who has a high reputation in the media industry

could well hold more power than his employer under possible new media laws, but this is not the situation for all journalists.

Even though the government has planned a number of safeguards to protect diversity within cross-owned-media outlets. For instance, each media outlet having separate editorial policies. The belief is that journalists could lose their jobs under cross-media ownership deregulation, especially if a cross-owned media outlet wished to combine all their newsrooms. The Fairfax group wanted to do this with TheAge and Sydney Morning Herald Canberra bureaus. Their argument is that there is little point in merging media companies if savings cannot be made by merging newsrooms. The problem with the government’s ‘safeguards’ is that it would be next to impossible to control, as the media will become a private – or more private – company, not a public one. Hence government control is limited.

Possible Effects of Change: The Public.

The implications for the public are that there will be the loss of diversity and local content in their news services. This has been seen in the radio and television industry at a metropolitan level, with our early morning and late night television news services being broadcast from television news-desks in Sydney – such as Seven’s ‘Sunrise’ and Nine’s ‘Nightline.’ And our radio breakfast and drive time radio shows being broadcast from studios in Sydney. This was highlighted in 2004 when the ABC wanted to do Melbourne’s sport news from Sydney. Cross-media changes will also affect the opinions of newspaper readers that are published. Currently our letters to the editor, etc. are printed no matter what stance on an issue we take. Under changed laws this may not be the case, especially if our views go against the outlets agenda.

Under changed media laws, the public will technically only have one or two outlets to get there news from, either the big two media, entertainment and business conglomerates or an even weaker and smaller ABC. Therefore change will Mute the voice and limit Australia’s media diversity.

-References:

Newspaper/ Magazine Articles:

• Carroll, V.J. “Masters of the Universe.” The Age. (February 02, 2002). p. 2 (Newsextra).
• Catalano, Christian and Jason Koutsoukis. “Media Puzzle.” The Age. (April 09, 2005). p. 1 (Business).
• Chessell, James. “Media Reforms on the Drawing Board.” Sydney Morning Herald. (May 04, 2005). p. 26.
• Dodd, Andrew. “One Owner, Two News Outlets.” The Australian. (March 28, 2002). p. 3.
• Fels, Allan and Fred Brenchley. “Media Barons Call the Tune.” Australian Financial Review. (December 29, 2004 – January 03, 2005). p. 67.
• Gottliebsen, Robert. “ACCC, News Minds Meet on Media Future.” The Australian. (April 29, 2005). p. 18 (All-round Country).
• Kohler, Alan. “Why Media Must Diversify or Die.” The Australian Financial Review. (March 26, 2002). p. 63 (News; Opinions).
• Kingston, Margo. “Closing the Door on Your Right to Know.” Sydney Morning Herald. (June 22, 2003). http://www.smh.com.au/articles/2003/06/22/105.6330481832.html.(23 March, 2005).
• Kingston, Margo. “Faultlines in Howard’s Plan for Absolute Power.” Sydney Morning Herald. (July 08, 2003). http://www.smh.com.au/articles/2003/07/08/1057430193001.html.(23 March, 2005).
• Lague, David. “China Welcomes Murdoch in from the Cold.” The Age. (December 12, 1998). p. 19 (World).
• Murdoch, Rupert. “Diversity Abounds in the Brave New World of Media.” The Age. (April 09, 1998). p. 17.
• Narain, Sunita. “The Most Serious News.” Down to Earth. (April 30, 2005). p. 5.
• Riley, Mark. “Murdoch Casts Slur on Dalai Lama.” The Age. (September 09, 1999). p. 2.
• Simons, Margaret. “Crikey Sells Out.” The Age. (February 05, 2005). p. 3.
• “Cross-Media Rules Protect the Public Interest.” The Age. (March 23, 2002). p. 14.
• “Foreign Ownership of Media not Important, says Alston.” The Age. (April 01, 2002). p. 5.
• “Media Laws Cause Concern.” The Age. (March 23, 2002). p. 4.

Television:

• LATELINE: TV Program Transcript. Interview: Tony Jones, Professor David Flint AND David Salter. “Cross-media Laws Discussed.” (May 03, 2001). http://www.abc.net.au/lateline/s289292.htm.(Accessed March 22, 2005).

Websites:

• Alger, Dean. 2002. “Professional Record.” Dean Alger for Secretary of State.” http://www.deanalger.org./prof_record.aspx.(18 May, 2005).
• Baker, Russ. “Mean Machine: How Rupert uses his Vast Media Power to help Himself and Hammer his Foes.” Columbia Journalism Review. http://64.4.18.250/cgi-bin/getmsg/pasreadwk11b.html?curmbox=F0000000...(21 March, 2005).
• Brenchley, Fred. 02 October, 2002. “Media Manoeuvres.” The Bulletin. http://bulletin.ninemsn.com.au/bulletin/site/articleIDs/11D7A5B43B1A252E5CA256C4...(05 May, 2005).
• Brenchley, Fred. 19 February, 2003. “Communication Shakedown.” The Bulletin. http://bulletin.ninemsn.com.au/bulletin/site/article/IDs/433DF83C3BFBB384CA256CC...(05 May, 2005).
• Carey, Aaron. 2002. “Media Ownership in Australia.” Guidomedia.com: An Australian Publishing Resource: Media Essays. http://www.guidomedia.com/aaroncarey.html.(15 March, 2005).
• Loewenstein, Anthony. April 12, 2005. “Australian Media.” ZNet Australia. http://www.zmag.org/content/print_article.cfm?itemID=7628&sectionID=58. (05 May, 2005).
• 22 October 2004. “NATIONAL NEWS: PM Open to Foreign Ownership of Media.” http://news.ninemsn.com.au/article.aspx?id=20729&print=true. (22 March, 2005).
• 09 February 2005. “FEATURES: Prime Time: The Full Script.” The Bulletin. http://bulletin.ninemsn.com.au/bulletin/site/articleIDs/86A72A731FC055D2CA256FA00077AD0A.(06 April, 2005).
• “About Us.” Herald Sun. http://www.heraldsun.news.com.au/sectionindex2/0,5443,dhsaboutus%255ETEXT%255Eheraldsun,00.html.(22 March, 2005).
• Publishing and Broadcasting Limited website. http://www.pbl.com.au/article.aspx?id=3886&print=true.(05 April, 2005).
• PBL Businesses. Publishing and Broadcasting Limited. http://www.pbl.com.au/businesses/default.aspx.(05 April, 2005).
• News Corporation website. http://www.newscorp.com/operations/newspapers.html.(05 April, 2005).
• www.crikey.com.au.(23 March, 2005).

Books/ Chapters:

• Alger, Dean. Megamedia: How Giant Corporations Dominate Mass Media, Distort Competition, and Endanger Democracy. (Lanham: Rowan and Littlefield Publishers, 1998).
• Brown, Allan and W.R. McComas. “Do We Have too Few Media Proprietors in Australia?” in Giles, R. (ed). For and Against: An Anthology of Public Issues in Australia. (Melbourne: Brooks Waterloo, 1989), pp. 216 – 217.
• Lumby, Catharine. “The Future of Journalism,” in Cunningham, Stuart and Graeme Turner (eds.), The Media and Communications in Australia. (Sydney: Allen and Unwin, 2002), pp. 320 – 330.
• Schultz, Julianne. “The Press,” in Cunningham, Stuart and Graeme Turner (eds.), The Media and Communication in Australia. (Sydney: Allen and Unwin, 2002), pp. 101 – 116.
• Laventhol, David. “Profit Pressures: A Question of Margins.” Columbia Journalism Review, (May – June, 2001), pp. 18 – 19.

Government Publications:

• Howell, David. 12 May 1999. “Submission to the Inquiry into Australia’s Broadcasting Legislation.” Email to broadcasting@pc.gov.au. (23 March, 2005).
• Jackson, Kim. 16 June 2002. Media Ownership Regulation in Australia. http://www.aph.gov.au/library/intguide/sp/media_regulations.htm.(23 March, 2005).
• “Limitations On Control: Cross-Media Limitations (Sections 60 and 61 of the Act),” http://www.aba.gov.au/ownership/limitations/x_media.shtm.(23 March, 2005).

Interviews:

• Day, Mark. Email Interviews by Author. 04 – 09 May, 2005.
• Mitchell, Neil. Email Interview by Author. 27 – 29 April, 2005.
• Prior, Sian. Email Interviews by Author. 28 April, 2005 – 04 May, 2005.

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