SPEECH - BROADCASTING LEGISLATION AMENDMENT (BROADCASTING REFORM) BILL 2017 AND THE COMMERCIAL BROADCASTING (TAX) BILL 2017 - 21 JUNE 2017

I rise to speak on the Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017 and the Commercial Broadcasting (Tax) Bill 2017, which is the Turnbull government's second attempt at media reform in the now almost four years that the coalition government has been in office. 

I want to make it clear that, as Labor has publicly stated, Labor supports the majority of items that are in these bills. Labor supports both bills as long as the provisions relating to the repeal of the two-out-of-three rule are omitted.

Labor's position on these issues has been crystal clear for some time now. Labor is committed to supporting the Australian media industry as well as the jobs and content it produces as the sector continues to adapt to the new media environment. At the same time, Labor is committed to safeguarding the public interest and our democracy and does not regard the existence of the internet in and of itself as a reasonable justification for the junking of fundamental public interest safeguards embodied in these provisions.

Labor acknowledges the competitive pressures the broadcasting industry now faces. Australia needs a thriving media industry to promote a diversity of voices, jobs and quality news, information and entertainment. It is imperative that the sector remains viable and competitive in the modern media environment. That is why Labor supports the measures that industry needs most; indeed, the provisions that the sector has been telling us, for a long time, they need most: first of all, licence fee relief; also, repeal of the 75 per cent reach rule, which, as I have said in the past, Labor views as a fundamental piece of deregulation; and then relaxation of the anti-siphoning scheme and list. Labor also acknowledges the facts around media ownership diversity in this country and understands the proper role of government in promoting diversity through competition. It is for this reason that Labor opposes the repeal of the two-out-of-three rule.

To state a few facts, Australia's level of media ownership concentration is already one of the highest in the world. Traditional media—newspapers, commercial television and commercial radio—continues to be the main source of news and current affairs for Australians, particularly in regional areas. The majority of the top 10 news websites accessed by Australians are either directly or jointly owned by traditional media platforms—meaning that they are the same voices on different platforms. And the digital divide means that access to new media still remains out of reach for many Australians, giving the substantive levels of broadband connectivity particularly in rural and regional areas.

While Labor acknowledges the increasing influence of new media in Australia, we do not mistake the entry of new voices online or the abundance of online content for diversity in terms of diversity of ownership of Australian media. It is a mistake to confuse the proliferation of content for diversity of ownership or opinion. As Professor Lesley Hitchins, an expert on broadcasting pluralism, cautions in her article, ' Media regulatory frameworks in the age of broadband: securing diversity':

It is the case that the media ecosystem seems to be characterized by abundance – there are multiple ways in which news, information and opinion, and entertainment content can be accessed. Of course, very often one is simply receiving much the same content via these new platforms, as would be received via the traditional platforms. And so there is a need for caution to ensure that one is not misled by an illusion of diversity. Scarcity may be present despite the appearance of abundance.

Similarly, as Paul Keating noted quite prophetically, the cross-media rules 'do not prevent any proprietor getting into new media' and dominant media owners do, in fact, control the most visited internet sites in Australia. Speaking of the cross-media rules, he said:

The question now is whether digital technology, which enables all forms of content to be delivered in similar ways, makes these rules out of date. I think this argument is greatly over-stated by the government and the existing media owners.

…   …   …

…the rationale given by those who argue for the ditching of the cross-media rules – that convergence is turning all forms of media into one – is the most powerful reason for not making it easier to concentrate ownership.

Again, to quote from Paul Keating in speech delivered in 2000:

Public policy should be directed towards promoting diversity and preventing any further concentration of media power.

The result might be some arguable economic inefficiencies around the edges, but the Australian polity will be healthier. The principal objective has to be diversity. And the only way to get it is competition. That alone.

…   …   …

The cross-media rules have never been an end in themselves, however. They were intended not to preserve a static media environment but to promote diversification; to facilitate dynamic change.

Labor recognises that, in the absence of a coherent vision from this government for the Australian media industry or the policy and regulatory framework that governs it, the pragmatic course of action at this time is to support the majority of the measures in these bills. Even though Labor regards this government's second attempt at media reform to be inadequate and piecemeal, we will take what little sensible process we can.

Turning to the media reform bill of 2016, the government's first attempt at media reform was their flawed Broadcasting Legislation Amendment (Media Reform) Bill 2016 which stalled in the Senate last November because the government seriously did not know the difference between regulatory housekeeping and genuine holistic reform. When the Turnbull government announced the media reform bill over a year ago in Marsh 2016, they boasted that it was the most significant reforms to our media laws in a generation. This was a gross over-statement for several reasons. Firstly, that bill contained only three key measures, two of which were in the nature of regulatory tinkering and one of which was completely ill-conceived. Secondly, the repeal of the 75 per cent reach rule was just a pedestrian section of regulatory housekeeping that could have been dealt with in any omnibus deregulation bill, given the usefulness of the rule had expired and it was largely redundant.

Labor had indicated its support for the repeal of the 75 per cent reach rule for some time. More than seven years ago in a Sydney Morning Herald article in April 2010, Senator Stephen Conroy was quoted as saying he thought the rule was outdated. He said:

As we move into high-speed broadband and TV stations start streaming their content live, I just don't think that that 75 per cent reach rule can survive. The technological change is going to wash over the top.

Conroy went on to announce the convergence review, which made sweeping recommendations for reform across the policy and regulatory framework. I know that I am repeating myself for the umpteenth time when I say that Labor has repeatedly indicated its support for the removal of the 75 per cent reach rule. Labor wishes to express its disappointment that the government has dithered and delayed this important measure.

Secondly, the amendments to local programming requirements for regional commercial television broadcasting licensees, obligations that follow a trigger event, were an extension of an existing scheme. Labor indicated its support for these measures last year.

Thirdly, the proposed repeal of the two-out-of-three cross-media rule was completely ill-conceived, given the very clear evidence that the rule should be retained, and given that simply removing safeguards does nothing to adapt our media regulation or our public interest safeguards to the 21st century.

Turning to the Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017: now, on their second attempt with this bill, the government is in disarray in this policy area. The broadcasting reform bill rehashes the provisions of the flawed media reform bill, and throws in a few additional bits and pieces designed to scrape together support for the repeal of the two-out-of-three rule. Despite having had almost four years to prepare the bills before the House today, and over six months since their last attempt at media reform, this government still has not worked through the detail of a number of very important measures to support the broadcasting industry which it announced on 6 May this year. Less than a week ago, as we understood it, the government had not, on the issue of additional restrictions for gambling advertising, worked out how they were going to legislate to introduce gambling advertising restrictions for live sport on online platforms. On the $30 million of funding to subscription television to support the broadcasting of women's and niche sports, they still have not worked out what outcomes or benefits they seek to achieve, saying that they had just started working on guidelines and principles, and they were still not clear on which sports might get the benefit of funding. Further, recent press reports of the long list of deals being considered to support passage of these bills are a testament to how problematic the proposed repeal of the two-out-of-three rule is.

I will turn now to the arguments made by the government on this point. The main arguments proffered in support of its bills can be summarised in four parts. Firstly, the government's media reform package has the historic and unprecedented support of the entire Australian media industry, they argue. Secondly, they argue that Australia's broadcasters are facing an increasingly competitive commercial environment, with intense competition for audiences and advertising revenue from other media companies as well as global online and on-demand operators. Their third argument is that it is necessary to repeal the two-out-of-three rule in order that media companies can achieve the scale needed to compete in the global market. Fourthly, they argue that the regulatory framework is outdated and in need of reform. I will take each of these arguments in turn.

Firstly, on the support of the Australian media industry: the bills before the parliament today give effect to a number of the measures the government announced in May to support the broadcasting sector. The bills are, overwhelmingly, pro-industry. It is not surprising, therefore, that the measures have the support of industry. Indeed, for a specifically convened media summit last month, chief executives from Australia's major commercial and subscription TV, newspaper and radio companies travelled to Parliament House to demonstrate their support for the measures announced by the government. There, industry support was lauded as an achievement of 'rare consensus' that is 'fragile', given the trade-offs made between fierce industry rivals. There is truth in this characterisation, particularly around highly contested sports rights. However, it is also true that a range of industry impacts are offset within the set of measures announced by the government. In addition to a number of deregulatory measures around ownership and control rules and antisiphoning, the bills save commercial broadcast licensees around $90 million per annum, with the abolition of license fees and the introduction of a new spectrum tax. The fact that the government's measures are unanimously supported by industry is notable but is not in itself a reason for parliament to support these bills without question. Media businesses answer to shareholders, not the Australian public. It is the role of the parliament to stand up for the public interest.

Secondly, on the issue of the competition being faced by Australian broadcasters: one of the main arguments proffered by this government in support of its bills is that, because of the internet, because of global competition, we need to kill diversity to save diversity. To quote the minister's 6 May announcement:

… Australia's broadcasters are facing an increasingly competitive commercial environment, with intense competition for audiences and advertising revenue from other media companies, including global online and on-demand operators.

The competition for audiences and advertising dollars that comes with digitisation and fragmentation has been anticipated, discussed and now experienced for many years. These pressures did not arise overnight, but I understand that companies generally do not like competition. Even way back in the 1930s, Australian newspaper proprietors pressured the federal government to change the legislation that created the ABC2, in effect, to restrict the public broadcaster from collecting its own news. This history was outlined in a recent ABC piece by Stan Correy, entitled 'How the newspapers tried to kill an independent ABC news before it even began'.

Today, our media companies complain about competition from the so-called global giants, including Google, Facebook and Netflix. It is simplistic to argue that it is us against them. In the contemporary media environment, Google and Facebook, search and social media, are part of the fabric now. I believe it was surprising to hear even the Prime Minister join the chorus of anti-Google sentiment at the media summit in Canberra recently. As Google MD, Jason Pellegrino, has observed—and I know that this has been a bone of contention between Google and some of the traditional proprietors—many Australian media companies are now in partnership with or in a symbiotic relationship with Google or YouTube or rely on search engines and social media for internet traffic to their own websites. I note that News Corp Australia's Michael Miller has argued in response to Pellegrino's claims, but what is clear is that the world has changed. The internet is not going away and companies that do not accept and adapt to that reality will not succeed. Consider the example of commercial radio in Australia. It is a medium that has done well to adapt in the new environment.

Thirdly, I go to the notion that it is necessary to repeal the two-out-of-three rule in order that media companies can achieve the scale necessary to compete in the global market. To take a leaf out of Bernard Keane's book, this argument is that you have to kill diversity in Australia in order to save diversity. What getting rid of the two-out-of-three rule means is that there will be greater consolidation of Australian media companies. With that, it is almost inevitable that media companies will consolidate and cut costs by merging and that there will be fewer journalists, fewer views, less information and more power for media proprietors. Abandoning the cross-media rules carries the danger of intensifying vertical integration and concentration without doing anything corresponding to benefit horizontal diversification, and then what? After a few mergers, what then? No-one has scripted the next scene. The government's package is a bandaid for industry. It offers almost nothing for consumers and citizens and undermines diversity. It does not address the real problems, the real policy problems within the current framework, or offer options for a new framework. Ultimately, industry, citizens and consumers will suffer for this government's ineptitude in this regard.

On the fact that the regulatory framework is out of date and in need of reform, Labor repeatedly called on the government from the outset to undertake a holistic, evidence based set of reforms, but what did the government do by way of response? Six months after the report of the Senate inquiry into the media reform bill was published last November, the Minister for Communications announced a series of reactive and surface-level deals cobbled together—a package of political trade-offs that do little to secure public interest outcomes in the contemporary media environment. Did the minister address any of the issues noted by his own independent regulator, the ACMA, in its 'Broken concepts', 'Enduring concepts' and 'Connected citizens' papers? He did not. Did he pick up on any of the ideas in the speech from the acting chair of the ACMA where he outlined several ideas for promoting media diversity? He did not.

The acting chairman of the ACMA, Richard Bean, delivered a speech on media diversity in November last year, two days after the Senate inquiry reported on the media reform bill and a few weeks before the media reform bill passed this House. In summary, the acting chair articulated that the fundamental problem with the current regulatory framework goes deep. The current Broadcasting Services Act was constructed around notions of influence and licence areas. He noted that current trends need to be understood and that he thinks we have something to learn from our colleagues in the UK when it comes to regulatory approaches. The acting chair concluded by saying:

That the regulator should be empowered to, and resourced, to gather a sound evidence base on which to assess risks and detriment, and respond proportionately when required.

Any responses must have built-in flexibility and adaptability, rather than attempting to preemptively establish a revised media regulatory framework that appears to be, or even is, appropriate for today’s circumstances, but which cannot be expected to remain appropriate for 20 years.

Just as other jurisdictions are recognising, we need a more nuanced way of assessing media influence and diversity of views and content that takes account of the dynamic digital media environment and the real consumption patterns of and impacts on citizens.

The challenges of delivering the objectives of promoting diversity and managing influence provide an opportunity for a fundamental rethink of our whole media regulatory construct.

None of the ACMA chair's ideas have been taken up in the context of this package. Similarly, Labor has called from the outset for holistic, evidence based reform, and those calls have gone unheeded.

In their four years in office, this government could have had a holistic review of the evidence four times over. This government's latest media reform package is surface-level and piecemeal when considered in the context of the true media reform that is actually needed. To bear out that fact, I note that from shortly after the election last year, when asked what Labor's approach to media reform would be, I suggested two things that this government would want to look at. Firstly, that Labor agrees with the need for deregulation where it is necessary, and that should be done swiftly. In the context of the outdated impact of the 75 per cent reach rule, the reality is that Labor would have been prepared to waive that repeal through. Indeed, this government had the opportunity in November last year. When we sat and divided on the media reform bill 2016, we provided the opportunity to this government to waive through repeal of the reach rule and to allow the addition of those local content obligations in the event of a trigger having occurred. Those went unheeded. The second point that was made from the outset was that we have not had in this country a detailed, holistic, independent review of the broadcasting landscape since the review of the Productivity Commission in the year 2000. What I put at that time was that we needed to have a sound evidence base on which to look at the whole puzzle and to not just take out bits and pieces, tinker with them and put them back, thinking that would have no impact on the ecosystem. That was not only a simplistic view but a flawed view. That went not only totally unheeded by this minister but absolutely dismissed. Some of the words he used at the time were: 'All the facts are already known.'

We saw even yesterday the release of the USO report undertaken by the Productivity Commission—a substantial piece of work which Labor has welcomed and which industry has said needed to be done. It has put forward a series of, in some ways, quite radical ideas. Also, it calls on policymakers to look at issues of transparency, where the rest of the telecommunications environment and the communications environment fit together, how rural and regional areas will benefit and what the best use of scarce resources is in order to achieve the universal service obligation. It was around July or August last year when I was calling for this. That inquiry could have been completed by now. We could have had a sound evidence base on which to conduct a real review and on which to have real reform coming before this parliament. That, unfortunately, now eludes us.

There are a couple of other issues that are particularly worth noting. The first is that this bill imposes restrictions on gambling advertising in live sporting events across all platforms. As I said, this will be implemented by codes of practice for broadcast platforms and by legislation for other platforms. I have noted, through the Senate estimates process that was conducted recently.

Earlier, I was talking about the additional gambling advertising restrictions that the Minister for Communications announced on 6 May and how it is notable that the minister was unable to explain at the Senate estimates process that was conducted recently exactly how they would be implemented by legislation when it comes to online platforms. The restrictions on broadcast platforms are expected to be implemented through codes of practice that will commence in 2018. Labor led the way in addressing community concerns around gambling advertising in 2013 by demanding that Australia's broadcasters amend their codes to ensure a reduction in the promotion and advertising of gambling during live sport.

Concerned that the rules were not working optimally, in March this year Labor moved a motion in this place calling on the government to work with the broadcasting industry and national sporting organisations on a transition plan to address the issue of gambling ads before and during live sports broadcasts. It is notable that government MPs voted against this motion, only to announce gambling advertising restrictions in live sporting events a few weeks later. Ultimately, Labor's leadership on this issue has compelled the government to act and we welcome the measures as a step in the right direction. That says that Labor does not consider that they go far enough to address community concerns.

We anticipate that our communities will continue to complain about the intrusion of gambling advertising in live sports, given the amount of gambling advertising this government's flawed proposal continues to allow and given the fact that gambling advertisers may simply shift their advertising to avoid the five-minute shoulder. It remains to be seen whether viewers will be bombarded with gambling advertisements at the 8.30 pm mark or whether the timing of live sports fixtures will be altered to minimise the impact of the new restrictions. Labor shares the concerns of people right across Australia who are worried about the impact of gambling advertising on our community. Adults and children should be able to enjoy watching live sport without the intrusion of betting odds and gambling ads, and it is in everyone's interest to ensure that children do not associate betting and gambling as a normal part of enjoying sport.

On the matter of sport, the government's announcement of $30 million in funding to support the broadcasting of women's and niche sports is yet another area where this government is picking up on Labor proposals. Labor announced funding to support broadcasting of women's sport on the ABC, a national free-to-air service, as part of its 2016 election platform. This government's main point of difference is that it will provide the funding to subscription TV rather than the ABC and it remains to be seen what the legacy of the government's approach will be, given subscription TV's current penetration is only around 30 per cent of Australian households.

On the issue of antisiphoning, Labor is committed to ensuring Australians enjoy coverage of premium sporting events on free-to-air TV. We regard the proposed changes to the antisiphoning scheme itself to be in the nature of regulatory housekeeping. On the changes to the list of events in the antisiphoning notice proposed in this bill, changes that are permitted under the current scheme, I note these are justified on practical reasons, where the history of rights' acquisition by broadcasters and audience viewing patterns no longer warrant their inclusion, for example.

As with so many issues in this portfolio, Labor is disappointed that the government has not conducted a holistic evidence based and public consultation process on the scheme and the impact of over-the-top providers in the lead-up to proposing this bill. While change may be effected in incremental steps, it would be useful to have a roadmap of where we are headed as those steps are taken. While government acknowledges that the Australian media market has changed significantly and is willing to abolish licence fees as a consequence, as I said previously, there is an utter failure to articulate a vision for the future or a roadmap for getting there.

That brings me to content reform. It is disappointing that the government has moved to ease pressure at one end of the value chain—being commercial broadcasters—but neglected other links. This government's ad hoc approach to reform sees it granting licence fee relief for broadcasters but no relief for the production sector, which is also feeling increased competitive pressures in the contemporary media landscape. The broadcasting sector is not the only industry that has been disrupted by digitisation; yet the government, which is coming to almost four years in office now, only recently announced a content review to assess issues in the Australian production sector.

Despite the fact that the Department of Communications has identified content issues as in need of reform since 2014, as part of its dereg roadmap, this government has only recently just announced a content review. Meanwhile, recent ABS data shows the government's commitment to Australian content in the context of media reform or broadcasting reform is all talk and no action. Since 2011-12, commercial TV broadcasters appear to have cut their commitment to Australian drama and documentaries by 20 per cent. They have moved more production in-house—from 44 per cent of production in 2011-12 to 55 per cent in 2015-16. In this time, they have had a series of broadcast licence fee cuts. The production sector is suffering as a consequence of this government's inaction when it comes to joined-up reform. Ad hoc regulatory tinkering is not addressing the structural issues being faced by the industry.

The communications minister has proven to be incapable of getting his ducks in a row to usher in abolition of broadcast licence fees and the introduction of a spectrum tax at the time, as identifying its content policy. Perhaps the nexus between the two is overlooked. As the Productivity Commission stated in its inquiry into broadcasting in 2000, licence fees 'seek to recover some of the value inherent in commercial broadcasting licences from commercial broadcasters and provide a return to the public for their use of scarce radiofrequency spectrum'. The sector-specific licence fees levied on commercial broadcasters formed part of the social compact that has been a central theme in how broadcasting policy and legislation has been approached in Australia until now. The compact provided broadcasters with privileged access to use the airwaves—the highly valuable, finite and public asset that is used to transmit programming. In exchange, broadcasters were required to pay licence fees and comply with regulation that aimed to promote a range of public interest objectives, including diversity.

I want to end by saying how important Labor believes it is that Australians reap a return on that use of such a valuable public asset, and that includes blind and low-vision Australians who need audio description. These reforms do nothing to support the introduction of audio description for the blind and vision impaired community in Australia. This government is dragging its feet, setting up a working group earlier this year which is not due to report until the last day of 2017. Blind and low-vision Australians deserve better.