The Australian government today announced a radical overhaul of media ownership laws that will allow greater foreign investment and is expected to spark a wave of mergers and takeovers. Communications Minister Helen Coonan said caps on overseas ownership would be lifted and companies would be allowed to own newspaper, radio and television operations in the same city or region. If cleared by parliament, Coonan said she expected the new regulations to be in place in 2007.
Critics argue that the long-awaited reforms will result in a further loss of diversity in a $12 billion(US$9 billion) market already dominated by just a handful of media moguls. The Australian subsidiary of Rupert Murdoch’s News Corporation, News Limited, controls nearly 70 percent of the metropolitan and national newspaper market. It will be able to extend its reach into television if the law is passed.
“The government’s proposal will allow an unwelcome concentration of media ownership and will reduce media diversity,” said Lindsay Tanner, communications spokesman for the opposition Labor Party. He noted that several countries, including the United States, Britain, Germany and France, imposed cross-media-ownership restrictions.
Coonan denied the plans would damage diversity. Under existing laws, the owner of one media platform - TV, print or radio - is banned from owning one of the other three platforms in the same market. Coonan said the restriction would only be ditched if there were at least five “independent voices” in metropolitan markets and four in regional areas.
Any merger would also have to be approved by the country’s competition watchdog. Although restrictions on foreign ownership would be lifted, the industry would still be classed as a “sensitive sector” under the government’s foreign investment policy and subject to close regulation, she added. Currently, there is a 15 percent limit on foreign control of Australian broadcasters and a 25 percent limit for mass-circulation newspapers. ”It is clear to the government and to much of the industry that the media landscape is changing rapidly, and a flexible system is needed to allow media companies to adapt and prosper in the new digital environment,” Coonan told reporters.
Rupert Murdoch has opposed the changes, saying they artificially protect, and will drive up the price, of existing free-to-air television stations. But the government rejected his calls to licence a fourth free-to-air channel. Coonan announced plans to open up two new digital channels and said the government will also encourage consumers to switch to digital television. She moved the target date to switch off the analogue signal from 2008 to 2010-2012.
Media companies welcomed the proposals. Fairfax chief executive David Kirk said they would strengthen the sector and promote diversity, while Ten Network said they would increase efficiency and competitiveness.
(Source: AFP)
on Jul 14th, 2006 at 16:59
In some very important respects, Australia already has one of most heavily concentrated media markets in the world. This should be of special concern in a country with democratic institutions and a tradition of strong free expression rights. This legislation will only serve to further concentrate such ownership.
Of course, Australia has some unique challenges in this regard. It is geographically a very large country with a correspondingly small population much of which lives in large metropolises in coastal areas with others scattered in very low density areas. Any media seeking to serve this demographic faces great expense and distribution challenges.