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Submission from the Australian Press Council to the Senate Environment, Communications, Information Technology and the Arts Legislation Committee on its inquiry into the Broadcasting Services Amendment (Media Ownership) Bill 2002 16 April 2002 The Submission Executive Summary The Australian Press Council does not object in principle to changes in cross-media ownership legislation but it foresees considerable and continuing problems if the proposed Broadcasting Services Amendment (Media Ownership) Bill becomes law. It submits that the proper ownership regulator should be the Australian Competition and Consumer Commission (ACCC) using existing legislation supplemented by a media-specific public interest test, developed in consultation with relevant stakeholders, and by changes that ensure the media is regarded as a single market for the purposes of mergers and acquisitions. Thus, it is the Council's view that judgments on substantial lessening of competition should be made on the basis of impact, circulation and penetration, considering the media as a single market. If the ACCC is not required to do this, the application of its competition test will not restrict cross media acquisitions. Foreign takeovers and acquisitions in the media should be subject to the Foreign Acquisitions and Takeovers Act as all other such acquisitions are, with the proviso that those administering the Act have regard for Australian content in the media as an issue of key importance in any such takeover or acquisition. The Submission 1. Public right to information through a free press The Press Council's interest stems from its first Object: To maintain the character of the Australian Press in accordance with the highest journalistic standards and to preserve its established freedom. The Australian press has long been characterised by freedom from government regulation and by the provision of full, fair and diverse information to the public about matters of public interest and concern. As in comparable democracies, there are multiple points of view and interest groups to be kept informed. No single newspaper or news agency can report all perspectives or tell the whole story. For the effective functioning of Australian democracy, there must be sufficient and sufficiently diverse sources of news and comment to ensure that members of the public are always promptly and well enough informed to make their own judgments about governance, regulation, sport, entertainment or other matters. No law or amendment to a law should restrict these fundamental citizenship rights. Access by all Australians to full, truthful, unbiased information about world and domestic events and to a pluralist range of opinions and commentary about those matters from an Australian perspective is the key issue to be considered in determining government policy on media ownership. Freedom of the press simply means its capacity (and its duty) to inform the public on matters of public interest and concern. The Press Council preserves established press freedoms by ensuring that the print media remain capable of serving the public free of any form of government regulation or licensing. The Press Council helps maintain high journalistic standards by, among other things, resolving, mediating and adjudicating complaints made by readers about material published in newspapers and magazines. It is against the background of its responsibilities that the Press Council raises the following objections to the proposed Broadcasting Services Amendment (Media Ownership) Bill 2002. 2. Newspapers are the public's primary source of news. Newspapers have special responsibilities. They break the stories and they provide the background information, and analysis of that information, on matters of public interest and concern. In addition to doing this for newspaper readers, newspapers set the agenda for radio talk shows and for television news and current affairs shows. A recent PriceWaterhouseCoopers survey (released on 25 March 2002) reported that 68 per cent of Australians use the newspapers as their primary source of information. It is especially important therefore that no actions of government have the effect of impeding, limiting, distorting or lessening the diversity and freedom of print media news sources. 3. Basis of inadequacy of proposals In the Council's view the inadequacy of the proposals derives from three key factors:
4. The Trade Practices Act is the appropriate framework for competition regulation The Broadcasting Services Act (BSA) is not the appropriate legislation for governance of competition. The Press Council rejects the arguments in paragraphs 102-104 of the Explanatory Memorandum to the Bill for reasons set out in this submission. Cross-media mergers once done will not be able to be easily undone. The Government should amend the TPA to enable the Australian Competition and Consumer Commission (ACCC) to take up the role of regulator of competition for the media as it does for other industries. The Productivity Commission, in its report on Broadcasting, recommended that the cross-media rules, currently in the BSA, be removed and replaced by the implementation of a media-specific public interest test on proposed media mergers and acquisitions to be administered by the ACCC under the TPA. The government has argued that suitable amendments to the TPA are not possible, yet is prepared to make amendments to the BSA which do not remove the cross-media ownership restrictions but impose a bureaucratic regime to be administered by the electronic media regulator. The Press Council believes that suitable amendments for any considerations relating to such matters as fostering media diversity can more easily be inserted into the TPA than through messy amendments to the BSA. The Productivity Commission pointed to the media-specific public interest test used in the UK. The Press Council believes that the ACCC should be able to develop a workable test to apply to media mergers and acquisitions. It is prepared to assist the ACCC in the development of such a test in the same way that it has helped the Treasury and ASIC to develop appropriate regulations under the Financial Services Reform legislation. 5. Government regulation of the press is incompatible with a free society The proposal incorporated into the Bill that cross-media ownership will become possible, subject to the Australian Broadcasting Authority (ABA) issuing an exemption certificate if three editorial conditions are met, is to introduce the first insidious steps of government control over the print media in its journalism role. As any government authority over print media editorial processes must be resisted, it is unacceptable for the ABA or any other arm of government to have this power. Giving a government-appointed authority the proposed power over the press, even though limited, will nevertheless be an historic departure, the first ominous step toward government press control in this country. It will be an historic breach of democratic rights. Once print media independence from government is compromised, however innocently that first step is portrayed, there will exist the strong possibility of additional amendments, further limiting and managing the press. The Press Council objects in principle to the imposition of a government-appointed and controlled authority over any aspect of print media editorial processes. The Council's objection is not based on the current composition of the ABA or any evident partisanship within that body, but on the principle of independence of the print media from government regulation and control. 6. Vagueness of requirements is dangerous The Bill envisages '... separate editorial decision-making responsibilities must be maintained in relation to each of the media operations.' There are to be three mandatory tests covering: These vague requirements provide both too little and too much detail. Both difficulties lead to danger for the Australian public. On the 'too little' side, there is a strong possibility that the three requirements will be unenforceable and meaningless. As a primary objective of any cross-media acquisition will be to reap the benefits of 'synergies', efforts to curtail cost cutting would be futile. There are so many ways around the vague requirements of the Bill that in practice it will be inoperable. What would a separate editorial policy amount to? Would a single paragraph cross-media application, saying that the newspaper will be a serious broadsheet analysing developments, while the television station will be devoted primarily to reporting news, be sufficient? And how would anyone be able to judge whether the organisation was carrying out the editorial policies as intended? Second, what would be an appropriate organisation chart? Could it be simply a chart that over time contained fewer and fewer positions? What of the third requirement for separate news management, compilation, gathering and interpretation? Could this be as few as two people in the newsroom, devoted solely to organising wire services? The Bill certainly does not make the requirements clear. How will those for or against a particular application know how to proceed? Most of all, if it turns out that a cross-media owner, after gaining an exemption certificate, pursues 'rationalisation' and is thought to be paying only lip service to the editorial independence rules, how will the ABA, in the inevitable litigation that would follow suspension or withdrawal of a certificate, prove that the withdrawal was justified? The outcome would probably be the inaction and impotence demonstrated by the ABA over the cash-for-comment allegations involving radio 2UE and its announcers Alan Jones and John Laws. The 'too much' difficulty may be that it is actually envisaged that the ABA will have sweeping control of the press. The intention might be that the ABA will be strengthened sufficiently to be in a position to tell the media organisation what its editorial coverage and sources have to be, how many editorial and journalistic staff, in what capacities, have to be hired, and how many and what kind of journalistic staff have to be sent to cover a story. The obvious outcome of the 'too much' difficulty would be draconian control of what the press has to cover (or not cover) and what can be published (or forbidden). What an authoritarian intrusion in a free society. What a damning erosion of the press's obligation to inform the public. Either way the proposals are unworkable. Whether overly vague or draconian, they hold intolerable current and future dangers for Australian citizens. 7. International examples The proposals in the Bill bear a remarkable resemblance to the provisions already in force in Canada. There, the Canadian Radio-television and Telecommunications Commission (CRTC) a year ago ruled to allow common ownership of newspapers and television stations as long as separate management and presentation remain in place. It has not proven a successful ploy: in the words of a headline in the newsletter of the Canadian Journalists for Free Expression: 'Canadian media convergence grows despite regulatory efforts'. According to the Globe and Mail, Canada now faces one of the largest media monopolies in the developed world. In 2001 CRTC approved media giant CanWest Global Communications' bid to buy out the large Southam chain. The February 2002 edition of the Commonwealth Press Union News reports that the Federation Professionalle des Journalistes du Quebec wrote in a statement of concern. 'For the second week in a row, fourteen newspapers in Canada's major cities, including the Montreal Gazette, will be obliged to publish the same national editorial. It asked the Finance Minister to ease the burden on Canada's private charities.' The Asper family, which owns CanWest (also the predominant shareholder in Channel 10 in Australia), runs a private charity. The changes advocated would be tax effective for them. The CPU News reports that journalists from the Montreal Gazette are contesting this editorial interference which they claim will undermine the independence and diversity of each newspaper's editorial board, greatly reducing the variety of opinion, debate and editorial discussion. The CPU News also contains an article by Stephen Kimber who was, until the article was written, a columnist for the Halifax Daily News. The piece intended to be his regular column was not published. The unpublished column contrasted an earlier tolerant response to a criticism he made of the actions of the publisher of the time (when staff cuts were in the offing) with the current imposition of its will by CanWest. The most recent result has been nationally-written corporate editorials running where local papers used to run local ones. Theoretically, there is still space for dissent on the op-ed pages but the reality is different. The owners, through their national editorial managers, want to control everything from newspaper editorial cartoonists to freelance columnists like me. No prizes for guessing why the column was not published and why the columnist no longer works for that newspaper in the Canadian world of cross-media ownership. 8. The owner's role As the Canadian example demonstrates, ownership and editorial control are not likely to be kept separate, especially by the artificial and unworkable tests proposed in the Bill. The Press Council's position is that an editor-in-chief, whether at the direction of, or with the support of, the ABA, has never been, and never will be, able completely to resist an owner's direction on the composition of staff or a particular re-organisation, even in good, but especially in bad, times. The economics of newspapers govern newsgathering and the organisation of newspapers. They always will. Any Bill that presumes, as this one does, that owners and their editors might be insulated from each other is based on a false premise. 9. The think global-respond locally argument. Another common argument is that newspaper content has to stay local and diverse to win readers so any failure to do this will put newspapers out of business. A variant is that going down-market in quality would have the same self-defeating effect. Owners have to respond to local cultural needs, goes the argument, so that it matters little who ultimately owns media organisations. The recent spate of closures of regional television newsrooms in Australia gives the direct lie to that point. Local content is diminishing. Newspaper chains, eg News Limited, APN News and Media7 etc, routinely make up pages for intestate and local use. The Hong Kong-based head of Ogilvy PR's Asia Pacific Group, Matthew Anderson (The Australian Media section, 28 March 2002), confirms these trends for newspapers in general: The consolidation of media ownership and widespread editorial downsizing has almost by default pushed the media's reliance on the PR sector up a couple of levels, and will continue to do so. ... So much for the possibilities for retention of diverse, local, culturally relevant content in an ABA supervised cross-media ownership world. In any case, the provisions in the Bill, derived from an inquiry in Broadcasting, seek to protect the local content of regional electronic media. There is no provision for any protection of local content in regional daily and provincial newspapers. Since these publications are usually more local than regional broadcasters, the potential for loss of local identity is greater and, arguably, needs more protection. It is another indication of the genesis of, and lack of proper attention to the media as a whole in, the proposals that there is no protection envisaged for regional print media content. 10. Conclusion The Press Council's position is that the proper ownership regulator is the ACCC using existing legislation, supplemented by a media-specific public interest test and by changes that ensure that the media is regarded as a single market for the purposes of mergers and acquisitions. It is concerned that, otherwise, the proportion of syndicated material will increase and the diminution of locally written material will be exacerbated. Diverse and national will give away to impersonal and international. Will those trends be detrimental to Australian life? Certainly. Does it matter that monopoly owners will inevitably impose their views and threaten normal democratic debate and decision-making? Certainly. Even if the time were ripe to introduce changes in cross-media ownership laws, and the Australian Press Council does not oppose in principle such changes, the proposals in the present Bill are not the right ones. Instead of repealing cross-media restrictions, they add another level of bureaucracy and entrench government regulation into the editorial processes of the print media, a development which is to be deplored. see also Return to Documents with the |
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