Murdoch rejects media reform plan

June 16, 2006 - 2:28PM

Australia's biggest media company, News Ltd, has told the federal government it cannot support its planned media reforms unless Canberra increases the number of free to air TV licences.

In a submission to a media reform blueprint released by Communications Minister Helen Coonan in March, the company said the government's proposals would do little for consumers while entrenching the privileged position of existing free to air companies.

Under the blueprint, which Senator Coonan hopes to turn into law by the end of the year, cross-media ownership limits would be lifted and a minimum number of media players imposed in each market - four in regional markets and five in mainland state capitals.

But existing limits on broadcasting licences would be retained.

News Ltd said while it supported removing cross and foreign ownership restrictions, the move would do little under the blueprint outlined by Senator Coonan.

It said the value of television assets in Australia would increase because there may be potentially a larger pool of buyers, but the absolute number of licences would remain the same.

However, newspaper owners would be disadvantaged because the number of newspapers could be expanded, reducing the value of existing mastheads.

Ultimately, the proposals would be of great advantage to existing holders of television licences.

"News Ltd could not support the proposed changes to cross and foreign ownership unless the discriminatory deregulation proposals are changed," it said.

"In particular, these changes should not occur until the government allocates new free to air licences."

The position puts News Ltd at loggerheads with Senator Coonan who has already ruled out a fourth free to air licence, let alone any more.

News Ltd used its submission to attack the performance of free to air television operators, saying they had done nothing to deserve their protected position.

It said pay TV had led many of the programming and value-adding breakthroughs of recent years, while free to airs had done almost nothing to generate demand for digital television.

"The Australian commercial free to air television industry is one of the most profitable and protected in the world while the Australian subscription television industry is one of the most unprofitable and over-regulated," it said.

"The preferred options will reward the commercial free to air television industry for its indolence in failing to stimulate digital conversion since it was allocated the additional spectrum.

"In addition to shoring up protection for the dominant and highly profitable free to air television industry, the preferred model poses a significant threat to the viability of Australia's emerging subscription television industry."

News Ltd argues the proposed 1,040 hour a year quota on high definition television from free to air operators should be substantially increased.

It also argues against the anti-siphoning laws, used to ensure certain marquee sporting events are broadcast free to air.

The company said free to air rights holders had hoarded sporting events, with less than 20 per cent of listed events actually broadcast free to air.

"Australia has the most onerous and anti-competitive anti-siphoning regime of any English speaking country," it said.

"There is little in the options paper that will change this."

