regulation of media ownership 203001308_1. introduction the rules, past and current the changing...
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Introduction
The Rules, Past and Current The Changing Shape of the Media Industry The Time Line for future Reform Ownership Effects
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Early Rules 1935 – law restricted multiple ownership of
commercial stations 1942 – Newspapers had acquired 44% of commercial
stations 1951 – Non citizens can’t control commercial stations 1956 – 1986 - two TV stations per interest limit 1986/87 cross media rules first introduced. “Cant be
queen of screen and prince of print.” Grandfathering rules first introduced 1965-1984, then
1987.
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Some Key Concepts
Actual Control In a position to exercise control Newspaper Company interests Tracing of interests Overlapping licence areas
The Pre-2007 RulesPrint TV Pay TV Radio and other
Foreign Ownership
Investments are subject to prior Federal Government approval
- 25% limit for any single foreign shareholder (30% in aggregate).
- 50% limit for provincial and suburban newspapers.
- prohibition on foreign control.
- 15% limit for single foreign shareholder.
- 20% aggregate limit.
- 20% limit on foreign directors.
- no control prohibition.
- 20% limit for single shareholder.
- 35% aggregate limit.
- BUT de facto foreign ownership has been achieved.
Foreign limits repealed in 1992.
Cross Media Rules
A person (foreign or Australian) cannot control:- a TV or radio licence AND a newspaper associated with the same licence area.- a TV AND radio licence in the same licence area.There are corresponding limits on directorships of companies which control those licences.
Competition Rules
Prohibit mergers or acquisitions which would substantially lessen competition in a market for goods or services in
Australia. The ACCC pro-actively monitors M&A activity.
Media Concentration
Competition rules only. Licence(s) must not exceed 75% of Australia's
population.
Competition Rules only. Must not control more than 2 licences in the same area.
Industry Structure
Print TV Pay TV Radio
4 major Print Groups (News, Fairfax, Rural Press, ACP)
3 Networks/Affiliated Regional Groups
1 Major Metro1 Major Regional
Several Networks of varying size
1 Metro and 1 Regional with major foreign investment
1 Network with major foreign economic interest
All have substantial foreign investments
2 of 4 Major Groups 100% foreign
The New RulesPrint TV Pay TV Radio and
other
Foreign Ownership
Investments are subject to prior Federal Government approval.
Cross Media Rules
5 Metro Voices/ 4 Regional Voices.
Competition Rules
Prohibit mergers or acquisitions which would substantially lessen competition in a market for goods or services in Australia. The ACCC pro-actively monitors M&A activity.
Media Concentration
Competition rules only.
Licence(s) must not exceed 75% of Australia's population.
Competition Rules only.
Must not control more than 2 licences in the same area.
Two RulesMedia Diversity
Rules
Statutory ControlRules
5 Media Groupings (Sydney, Melbourne, Brisbane, Adelaide, Perth): Section 61AB(1)
1 TV Licence/area: Section 53(2)
75% TV audience reach: Section 53(1)
No TV or radio/datacasting transmitter: Sections 54A and 54B
2 radio licences/area
4 Media Groupings elsewhere: Section 61AB(2)
Directorship equivalents
Limit on control of 2 out of 3 for commercial radio/TV/print: Section 61AEA
Structure
Register
Protective Advantages
Reporting Obligations
Unacceptable Media Diversity Situation
Key Definitions
Sections 61AC and 61AE
Points Test
Sections 61AU to 61AZH Section 61AB
Section 61AN(4)
Points Test: Section 61AC
Radio Licence Area 50% radio/TV overlapNo radio overlap
Media Operation Any of radio/TV/Associated newspaper
Media Grouping Control test applies
Points Test
State Newspaper Television Radio Total
Sydney 2 3 8 13
Melbourne 2 3 7 12
Brisbane 1 3 4 8
Reporting Obligations
Penalties: sections 63 and 64 Media Groups Protected: section 61AN(4) First Mover Advantage for innocent breaches:
section 61AN(7) and (8) Prior approval: sections 61AJ and 61AMC
Prior Approval
ACMA 30 days for further information No decision making time limit – 45 day/best
endeavours One month
Undertakings
2 years for unacceptablemedia diversity
12 months for unacceptable 3-way control
The Register
Initial entry/asap after 1/2/07: sections 65, 61AU and 61AY
New media group: section 61AZ Conditional entries: section 61AZD Unconfirmed entries: section 61AZE Time of essence
Remedial Directions: Sections 61AN and 61ANA Not to registered controller: section 61AN(4) Period of up to 2 years/12 months
Extension for compliance available: section 61AP
Good faithReasonable precautions
Flagrant = 1 month
The Time Line
HDTV/ABC/SBS Multichannel
2007
Relax Media Ownership
Auction of 2 digital channels
Anti-Siphoning Use it or Lose it
SD Multichannel
Full Anti-Siphoning Review
2009 2010-12
Analogue Switchoff
Full Multichannel
Digital Radio Introduction
New Digital Channels
Channel AMust be:
DatacastingNarrowcastingCommunity televisionFor domestic reception
Must be digital
Not available for FTA broadcasters
Channel BMust not be:
Commercial broadcasting or re-transmission service or subscriptiontelevision for domestic digital television reception
Not controlled by commercial or national broadcasting if for domestic television reception
Cross-Media DisclosureCommon control
TV
Radio Newspaper
• Commercial television broadcast: section 61BB
• Business affairs disclosure – commercial radio: section 61BD
• Regular disclosure – commercial radio: section 61BE
• Disclosure by newspaper publisher: section 61BF
Licence Conditions
Regional TV In aggregated markets: section 43A To broadcast minimum levels of material of local
significance Prime, Southern Cross, WIN, NBN, Seven
Licence Condition: Commercial Radio Regional Radio
Trigger event: section 61CB Licence must maintain minimum levels (section
61CD) for local news, weather, community service announcements, emergency warnings
Licensee to submit local content plan for approval: section 61CF
Local content condition: section 43C Local presence condition if trigger event occurs:
section 43B
Regional Radio Trigger Event change of control
Minimum standards News (5) weather (5), community services (1),Emergencies
Local Content Plan Local presence condition
ACMA Approval
Annual Compliance Report
Effects: Television
KKRSeven Network Conversion50% Convertible Notes
Creation of separate PBL Media Group
Nine Network Further 25%50% Convertible Notes
CanwestTen Network Sought whole of Network sale1992
50% Convertible Notes
Acquired STW Perth and NWS AdelaideWin Television
Canwesttoconvert
CVC
Effects: Radio
DMG1. Macquarie Media Phase One
Undertaking to divest various licences
acquired
SouthernCross
2. Macquarie Media/ Fairfax
Macquarie Media to acquire television
Undertaking to divest 12 radio licences
Fairfax to acquire radio
Industry Structure
Print TV Pay TV Radio
3 major Print Groups, one with radio holding
3 Networks/Affiliated Regional Groups
1 Major Metro1 Major Regional
Several Networks of varying size(2 fewer networks), one with regional TV
1 Metro and 1 Regional with major foreign investment
All metro networks have major foreign economic interest
All have substantial foreign investments
2 of 4 Major Groups 100% foreign