Media consolidation needed to strengthen industry

Arvind Hickman
By Arvind Hickman | 8 April 2016

A media regulation expert believes ownership reform is necessary to strengthen media companies in the face of a rapidly changing and more competitive environment.

Changes to the 75% audience reach rule and two-out-of-three cross-media ownership rule have been presented to parliament as part of communications minister Mitch Fifield's reform package.

UTS professor Derek Wilding, an expert on media regulation who gave evidence at the senate committee hearing into media ownership last week, tells AdNews that while a more comprehensive approach to media reform would have been desirable, some change is better than the status quo, particularly given the current plight of regional TV broadcasters.

“At some stage it is likely that there will be a further wave of media reform not just related to media ownership,” Wilding says.

“There are such significant changes in the media landscape at the moment that there's potentially a benefit in moving to a new model where we have a small number of well-resourced, really competitive converged cross-media companies, so I support the bill to that extent.”

Wilding says there is a fair chance there will be a “major shake-up” in the industry, particularly as there is broad support to abolish the 75% audience reach rule, although the two-out-of-three cross-media ownership rule has a more difficult passage through parliament.

A likely outcome, if the reforms are passed, is that regional broadcasters will merge with metropolitan counterparts with talks between several players already mooted.

Nine recently bought a 9.99% stake in Southern Cross Media Group and CEO Hugh Marks has reportedly begun sounding out investors of a potential merger.

Nine has previously entertained a merger with WIN, which has been Nine's regional affiliate for the past 27 years.

However, that relationship appears to have soured in recent times and WIN has taken Nine to court to try and prevent it from streaming linear TV content in WIN's broadcasting region.

Wilding says the costly court case, which hinges over the detail of the lastest program supply agreement between the two parties, is a sign of how perilous regional broadcasting has become.

“It was instructive listening to the three regional broadcasters at the senate hearing and how it impacted their business. The change was first felt in October last year and Prime said there was a 12% drop in January and a further 7% drop in February,” he says.

“It seemed to be so significant they were judging it on a month-to-month basis. If you look at it in that environment you can see why they might take legal action rather than wait for the reforms.”

Wilding says WIN's argument that streaming constitutes a TV broadcast doesn't stack up to the definition outlined in the Broadcasting Services Act.

Whether this definition first devised in 1996 and further reinforced in 2002 by former communications minister Richard Alston is still relevant today, changing the statue to include streaming is not straightforward. 

For starters, legislators need to consider how to apply Australian content obligations that are currently expected of broadcasters, such as children's programming, local news content and regional programming, onto streaming companies.

“Others might argue should they also still apply to terrestrial broadcasters. It's a big question that the dispute between WIN and Nine doesn't give us the answer to,” Wilding adds, further emphasising the need for a broader debate about media reform.

Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at

Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.

comments powered by Disqus