Bills Digest No. 169 2000-01
Broadcasting Legislation Amendment Bill (No. 2) 2001
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Endnotes
Contact Officer & Copyright Details
Broadcasting Legislation Amendment Bill (No. 2) 2001
Date Introduced: 5 April
2001
House: House of Representatives
Portfolio: Communications,
Information Technology and the Arts
Commencement: Royal
Assent
This Bill will amend the Broadcasting Services Act
1992 to:
- remove the capacity of existing commercial television licensees to
block the allocation of an additional licence in two-station markets
- permit the automatic de-listing of events from the anti-siphoning
list (a list of sporting events that pay TV licensees are prohibited
from acquiring unless certain conditions have been met)
- modify the simulcast provisions relating to digital television transmissions,
and
- make minor changes relating to datacasting.
As this Bill has no central theme the background to the
various measures is included in the discussion of the main provisions.
Commercial Television Licences
Commercial television licences are allocated by the Australian
Broadcasting Authority (ABA) in accordance with the provisions of the
Broadcasting Services Act 1992 (the BSA). Each licence is allocated
with respect to a specific licence area, with no more than three licences
being awarded for any one area. No licensee may control more than one
licence in a particular licence area. However, for licence areas in regional
and remote markets that are too small to support more than one or two
commercial television operators, the control rules are relaxed so that
audiences may have the opportunity to receive a range of services similar
to that available in metropolitan areas.
In licence areas with only one commercial television
licence, that licensee may apply for an additional licence (section 38A).
In areas with only two licences (neither of which was awarded under section
38A), the existing licensees must submit a joint written notice stating
that:
- they will jointly apply for the additional licence
- they will separately apply for the additional licence, or
- only one of them will apply for the additional licence (section 38B).
This requirement for a joint written notice in all three
circumstances has, in effect, given one of the licensees a veto power
over the other in situations where only one of them wishes to apply for
the additional licence. While there has been not yet been an instance
where a licensee has attempted to exercise this veto power, the Government
has decided that it would be prudent to deal with the anomaly.(2)
Items 1-3 of Schedule 1 insert new subsections 38B(1)(3)(4)(7)(8)
and (9) of the BSA. These will have the effect of removing the requirement
for a joint written notice for separate and sole applications for additional
licences in those areas with only two commercial television licenses.
Licence areas with two licensees include Darwin, Mildura,
Tasmania, Regional Western Australia, Remote Central and Eastern Australia
and Mt Isa. There should now be no impediment to these areas receiving
an additional commercial television service.
Item 4 of Schedule 1 of the Bill substitutes a
new section 73A, which protects the controllers of additional licences
granted under section 38B from being in breach of the control rules (ie.
that no person shall control more than one licence in a licence area).
This was considered necessary because the existing provisions of section
73A may not protect certain licensees in some circumstances. In particular,
the current provisions were not drafted to cater for situations where
a large licence area overlaps a number of smaller separate licence areas,
the licences for which are controlled in common.
Anti-Siphoning Provisions
Current Provisions
The purpose of the anti-siphoning provisions is to attempt
to ensure that major sporting events, which have traditionally been shown
on free-to-air television, are not acquired for exclusive coverage by
pay television. Under section 115(1) of the BSA, the Minister may gazette
events which he believes should be available free to the general public.(3)
Such events are de-listed 168 hours after they finish, unless the Minister
declares otherwise (subsection 115(1B)). The Minister may also remove
events from the list (subsection 115(2)). Ministerial notices and declarations
under section 115 are disallowable instruments.
Section 115 imposes no obligations on free-to-air broadcasters
to show listed events. The anti-siphoning list has effect because of paragraph
10(1)(e) of Schedule 2 of the Act. This makes it a condition of pay television
licenses that licensees will not acquire the right to televise listed
events unless:
- the ABC or the SBS have the right to televise the event, or
- commercial television licensees whose services reach more than fifty
per cent of the Australian population have the right to televise the
event.
The Act also contains extensive provisions to prevent
commercial television operators from 'hoarding' the rights to sporting
events (ie. obtaining the rights and not using them). These provisions,
contained in Part 10A of the BSA, were introduced by the Broadcasting
Services Amendment Act (No.1) 1999.
Productivity Commission's View
The Productivity Commission's Inquiry Report on Broadcasting
(March 2000)(4) discussed the anti-siphoning provisions and
related issues. It concluded that the provisions were anti-competitive
and that the costs of the regime to sporting organisations, the broadcasting
industry and the community, exceeded the benefits. However, it accepted
that there would be migration of popular sporting events from free-to-air
to pay television if the provisions were repealed and for this reason
recommended that some regulation be maintained. It recommended that:
- neither free-to-air nor pay television broadcasters should be permitted
to obtain exclusive rights to sporting events of major national significance
- stricter criteria for a new and much shorter list of events, and
- the transfer of the responsibility for the administration of the scheme
from the Minister to the ABA, with streamlined procedures.
To date, the Government has not pursued any of these
options.
ABA Investigation
On the 22 December 2000 the Minister directed the ABA
to conduct an investigation of the anti-siphoning list, in particular:
- which events should be removed from the list
- which events should be added, and
- the date or dates on which protection should expire for events that
the ABA considers should be retained in or added to the list.
The ABA is to report to the Minister by 30 June 2001.(5)
In February 2001 the ABA produced an Issues Paper on the subject and sought
submissions from interested parties. The authority is also undertaking
consultations with commercial and pay television operators, the national
broadcasters and sports bodies.
De-listing of Events
The Bill deals with only one aspect of the anti-siphoning
provisions: the removal of events from the list. The current provisions
specify that events will be automatically removed 168 hours after they
finish. The Minister may also remove events from the list at any time,
subject to parliamentary disallowance. Circumstances where the Minister
might consider removal include:
- where free-to-air broadcasters have had the opportunity to acquire
the rights, but have not done so, or
- where free-to-air broadcasters have the rights, but have televised
an unreasonably small proportion of the event.(6)
In both of these cases, removal of the event would presumably
result in a greater availability of the event on television, which is
the ultimate objective of the anti-siphoning provisions. However, it should
be noted that the Minister is not required to justify removal of an event
from the list.
The proposed amendments (Item 5 of Schedule 1)
provide for automatic removal 1008 hours (six weeks) before the start
of the event, unless the Minister declares otherwise. Such a declaration
can only be made if the Minister is satisfied that at least one
free-to-air broadcaster has not had a reasonable opportunity to acquire
the television rights to the event.
The justification for this change is that the current
procedures are cumbersome and lengthy, and that pay TV operators find
it difficult to properly schedule and promote events as a result.(7)
There is also no incentive for free-to-air broadcasters to support de-listing,
even if they have no intention of broadcasting an event. The new provisions
should encourage free-to-air operators to promptly secure the rights to
events that they wish to broadcast, while denying them the opportunity
to stall the acquisition of events by pay TV.
Views of Interested Parties
The proposed change has been welcomed by pay TV operators.
However, the industry's peak body, the Australian Subscription Television
and Radio Association (ASTRA), has suggested that the de-listing period
be increased from six weeks to ten weeks, arguing that it is the routine
practice of free-to-air networks to acquire rights a year or more in advance.(8)
The Federation of Australian Commercial Television Stations
(FACTS)(9) has opposed the changes, arguing that:
- they will increase the negotiating power of the holders of sports
rights
- they will switch the 'onus of proof' from pay TV operators to the
free-to-air broadcasters ie. the latter will have to demonstrate that
the rights have not been made available to them, and
- they do not require the Minister to de-list events even if a broadcaster
notifies the Minister that it has not had a genuine opportunity to acquire
the rights.
FACTS has proposed an alternative regime: at any time
during a three month period before an event, pay TV operators may give
the Minister notice that they wish to have the event de-listed. If free-to-air
broadcasters make an objection, then the de-listing is halted. The Minister
can then make a determination that the free-to-air broadcasters have had
a reasonable opportunity to obtain the rights on 'reasonable commercial
terms'. The Bill does not use the latter term, but refers only to a 'reasonable
opportunity to acquire the right'.
Comment
Given that the Productivity Commission determined that
the anti-siphoning rules conferred an economic benefit on the free-to-air
broadcasters at the expense of sports rights holders and pay TV operators,
then it would appear not unreasonable to transfer the 'onus of proof'
to the broadcasters and increase the negotiating power of sports rights
holders. The purpose of the rules was not to improve and entrench the
commercial position of the free-to-air networks, but to protect the viewing
public. Providing the original intent of the rules is maintained, then
any reduction in their anti-competitive effect should be welcomed.
FACTS insistence on 'reasonable commercial terms' would
appear to be unnecessary. It is unlikely that the Minister would be satisfied
that free-to-air television stations have had a 'reasonable opportunity
to acquire the right to televise an event' if the commercial terms of
the acquisition were themselves unreasonable.
Digital Transmission Changes
Under the digital broadcasting regime (Schedule 4 of
the BSA), commercial and national television broadcasters are required
to simulcast in high definition (HDTV) and standard definition (SDTV)
digital mode in non-remote areas. The Bill relaxes this requirement by
permitting the ABA to make determinations which would have the effect
of excluding certain programs and advertisements from the simulcast requirements.
The determinations will be disallowable instruments.
Item 8 of Schedule 1 inserts a new clause 37EA
in Schedule 4 of the BSA allowing such determinations in respect of commercial
television licensees. Item 9 of Schedule 1 inserts a new clause
37FA allowing similar determinations with regard to the national broadcasters
(the ABC and SBS).
The relaxation of the simulcast requirements for programs
is limited to one year after the commencement of the determination. The
purpose of the amendment is to allow broadcasters to 'time-shift' programs
so that they can showcase the benefits of HDTV. For example, they will
be able to show HDTV programs in the daytime when the shops are open,
providing the same program is shown in SDTV within the period of 168 hours
before or after the HDTV transmission. For this reason, these provisions
were referred to as the 'Harvey Norman' amendments during the proceedings
of the Senate Committee. Commercial and national broadcasters will be
able to repeat such HDTV transmissions, but only the first transmission
will count towards the requirement for 20 hours of HDTV programs each
week.
The relaxation of the simulcast requirements for advertisements
is limited to two years after the introduction of digital transmission.
The justification for this change is that it will enable commercial broadcasters
to put in place the necessary equipment to provide the same range of HDTV
advertising as they provide in SDTV.
ASTRA has claimed that the changes will enable the free-to-air
broadcasters to undertake a form of multi-channelling, because they will
be able to broadcast different programs in HDTV mode on different channels
at different times. The digital conversion scheme for commercial broadcasters
prohibits multi-channelling, as it would provide unfair competition to
pay TV licensees. However, it would seem that there are sufficient safeguards
to ensure that the original policy objectives of the legislation are not
compromised: the ABA determinations providing exemptions to the simulcast
requirements must specify programs, licensees and time periods. These
determinations are also subject to parliamentary disallowance.
FACTS expressed concern that the amendments did not provide
it with an exemption to broadcast a 'demonstration loop tape'. This tape
would contain extracts of high definition program material for promotional
purposes and would run for 30 to 60 minutes. FACTS argues that the tape
would not be suitable for broadcast at a later time in standard definition
or analogue because it would only contain parts of programs.
ASTRA stated that it had no objection to an amendment
allowing the broadcast of such a tape so long as the exemption was clearly
defined and restricted.
The Department of Communications, Information Technology
and the Arts however stated that the Government did not want material
to be broadcast that could only be shown in HDTV and that the Government
wanted material which could be compared through the joint transmission
on HDTV and SDTV.(10)
The Senate Committee noted that as the Bill stands:
'..free-to-air broadcasters will be unable to show
their demonstration loop tapes in HDTV if they decide that the tapes
are unsuitable for SDTV/analog transmission because of the provisions
in the bill requiring SDTV/analog broadcasting within seven days,
before or after the HDTV broadcast.'(11)
The Labor and Democrat minority reports however advocated
an amendment to the Bill to allow the free to air networks to seek an
exemption from the ABA to broadcast a 30-60 demonstration tape without
having to simulcast in SDTV and analogue.
Datacasting
Datacasting services are not presently available to the
public. The Government abandoned the planned auction of datacasting transmission
licences in May 2001(12) following the withdrawal of a number
of potential bidders such as Telstra, Fairfax and News Limited. Some commentators
have blamed the lack of interest in the licences on the restrictive nature
of datacasting regime.(13)
The regulatory framework for datacasting is contained
in Schedule 6 of the BSA. The legislation imposes genre conditions on
datacasters to ensure that they will not become
de-facto television broadcasters. These conditions restrict the ability
of datacasters to transmit certain types of programs including drama,
current affairs and sports programs.
One type of program that a datacaster would be able to
transmit under the existing legislation is a 'foreign-language news bulletin'.
The Bill only makes a very minor amendment to Schedule 6 by replacing
references to 'foreign-language news bulletin' with references to 'foreign-language
news or current affairs program' (items 13,14, 15 and 17). The
practical effect of these amendments will be minimal however as foreign-language
news bulletins are already defined to include discussion, commentary or
analysis in relation to the items included in such a bulletin.
- On 23 May 2001 the Senate referred the Bill to the Environment, Communications,
Information Technology and the Arts Legislation Committee for inquiry
and report by 19 June 2001. See http://www.aph.gov.au/senate/committee/ecita_ctte/Advert/ecita_BL2.htm
for more details. Submissions were received from the Federation of Australian
Commercial Television Stations (FACTS), the Australian Subscription
Radio and Television Association (ASTRA), Foxtel, Fox Sports and the
ABC. They can be obtained from the following address: http://www.aph.gov.au/senate/committee/ecita_ctte/Blab2/Blab2Sublist.htm.
- Mr Tanner (General Manager, ABA), Evidence, 8 June 2001, p.
10.
- The original anti-siphoning list was the Broadcasting Services (Events)
Notice No.1 of 1994.
- This report can be obtained from http://www.pc.gov.au/inquiry/broadcst/finalreport/index.html.
The discussion on the
anti-siphoning provisions in contained on pages 429-445.
- Information on this investigation can be obtained from the following
ABA Internet site: http://www.aba.gov.au/what/program/anti_si_issues.htm
- These examples are contained in notes to subsection 115(2) of the
BSA.
- The Hon Mal Brough, House of Representatives, Debates, Second
Reading Speech, 5 April 2001, p. 26538
- ASTRA submission to the Environment, Communications, Information Technology
and the Arts Legislation Committee (see 1 above).
- FACTS submission to the Environment, Communications, Information Technology
and the Arts Legislation Committee (see 1 above).
- Ms Page (Chief General Manager, DCITA), Evidence, 8 June 2001,
p. 12.
- Senate Environment, Communications, Information echnology and the
Arts Legislation Committee, Broadcasting Legislation Amendment Bill
(No.2) 2001, June 2001, p.17.
The Committee's report can be obtained from: http://www.aph.gov.au/senate/committee/ecita_ctte/Blab2/contents.htm
- Minister for Communications, Information Technology and the Arts,
'Datacasting licence auction cancelled', Media Release, 9 May
2001.
- See Darren Gray and Sophie Douez, 'Government urged to lift digital
TV restrictions', The Age, 11 May 2001.
Kim Jackson and Mark Tapley
25 June 2001
Bills Digest Service
Information and Research Services
This paper has been prepared for general distribution to Senators and
Members of the Australian Parliament. While great care is taken to ensure
that the paper is accurate and balanced, the paper is written using information
publicly available at the time of production. The views expressed are
those of the author and should not be attributed to the Information and
Research Services (IRS). Advice on legislation or legal policy issues
contained in this paper is provided for use in parliamentary debate and
for related parliamentary purposes. This paper is not professional legal
opinion. Readers are reminded that the paper is not an official parliamentary
or Australian government document.
IRS staff are available to discuss the paper's contents
with Senators and Members
and their staff but not with members of the public.
ISSN 1328-8091
© Commonwealth of Australia 2000
Except to the extent of the uses permitted under the Copyright Act
1968, no part of this publication may be reproduced or transmitted
in any form or by any means, including information storage and retrieval
systems, without the prior written consent of the Parliamentary Library,
other than by Members of the Australian Parliament in the course of their
official duties.
Published by the Department of the Parliamentary Library, 2000.
|
