BILLS DIGEST NO. 98, 2016–17              16 May 2017

Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017

Dr Rhonda Jolly
Social Policy Section

This Bills Digest includes information that was presented in the Digest to the Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2015 as well as information resulting from a Senate inquiry into that Bill and other relevant updated comments and discussion.

Date introduced: 22 March 2017

House: House of Representatives

Portfolio: Communications and the Arts

Commencement: the day after the Act receives Royal Assent

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the Federal Register of Legislation website

All hyperlinks in this Bills Digest are correct as at May 2017.

The Bills Digest at a glance

Purpose of the Bill

•       The Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017 (the Bill) amends the Special Broadcasting Service Act 1991 (the SBS Act) to allow the Special Broadcasting Service (SBS) to:

–      increase its potential revenue base by permitting it to employ more flexibility in the scheduling of advertisements and

–      earn additional revenue through the use of product placement endorsements in its commissioned programming.

Background

•       The SBS Act, which established SBS television as a corporation, sanctioned the introduction of advertisements or sponsorship announcements. Until 2006, advertisements were only allowed during periods before programs commenced, after programs had ended or during what was labelled ‘natural program breaks'. The time limit for these advertisements and sponsorship announcements was five minutes per hour; it did not include station promotional material.

•       Since 2006, however, the term ‘natural program breaks’ has been interpreted by SBS management also to encompass breaks which are designed to occur within scheduled programming (existing section 45(2)(b)).

•       SBS is currently permitted to broadcast 120 minutes of advertising and sponsorship announcements within a 24-hour period.

Key issues

•       The Government argues that the changes in this Bill are twofold; they will make SBS less dependent on Government funding, while at the same time they will assist the broadcaster to secure for itself a sustainable, independent future. SBS supports the proposed changes, maintaining that they will allow it to continue to provide services at current levels, despite cuts to funding imposed through government efficiency dividends.

•       Commercial broadcasters claim that allowing these changes to the SBS advertising regime will reduce their advertising revenues by effectively transforming SBS into a fourth commercial broadcaster. This will mean that four networks will share the dwindling sources of revenue available to traditional broadcasters as a result of the rise of new forms of media.

•       Public broadcaster advocates who object to advertising on SBS and the Australian Broadcasting Corporation (ABC) argue that the proposed changes will make it difficult for SBS to function effectively within the conditions of its Charter, which requires it to contribute to, and promote the diversity of Australian society. Moreover, as a result of the proposed changes, the broadcaster may be inclined to place the needs of advertisers before the needs of viewers. Thus, programming will be assessed on its ability to raise revenue, not on its potential to deliver on Charter obligations.

Purpose of the Bill

The Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017 (the Bill) amends the Special Broadcasting Service Act 1991 (SBS Act) to allow SBS potentially to increase its revenue base by permitting it to employ more flexibility in its scheduling of advertising and sponsorship announcements.

Under the proposed new arrangements SBS will be able to air more advertising and sponsorship announcements in prime time viewing periods, provided it concomitantly reduces the amount of advertising and sponsorship shown at other times throughout a 24-hour period.

The Bill also clarifies that SBS is allowed to earn additional revenue through the use of product placement endorsements in its commissioned programming.

Structure of the Bill

This Bill consists of two schedules to amend the SBS Act.

Advertising flexibility

Item 1 of Schedule 1: provides new flexibility arrangements for SBS to allow it to increase the time allocated to broadcast sponsorship announcements from five minutes per hour to ten minutes per hour in certain time periods—as it chooses. However, the total amount of advertising and sponsorship announcement must not exceed the current allowance of 120 minutes in each 24-hour period (proposed paragraph 45(2)(b)).

Product placement

Schedule 2: authorises SBS to broadcast programs that include product placement and requires the broadcaster to develop guidelines with regard to product placement.

Background

SBS was established on 1 January 1978 as an independent statutory authority to administer ethnic broadcasting in Australia. At the time this consisted of two radio stations, 2EA Sydney and 3EA Melbourne. In 1980, multicultural broadcasting was enhanced through the introduction of SBS television.[1]

Initially, SBS television was funded solely through ‘such moneys as [were] appropriated by the Parliament for the purposes of the Service’.[2] However, after SBS gained the television rights to the World Football Cup in 1990 it took advantage of the increase in audience this event attracted and supplemented its funding by seeking commercial sponsorship for the occasion. The success of this commercial undertaking led SBS to lobby the Federal Government for permission for advertising to be associated with all SBS programs, with the exception of news and current affairs programs.[3]

The SBS Act, which established SBS television as a corporation, sanctioned the introduction of 'advertisements or sponsorship announcements'. Advertisements, however, were to be only those 'that [ran] during periods before programs commence, after programs end or during natural program breaks'.[4]

It has been argued that Brian Johns, Managing Director of SBS when the SBS Act was passed, was the principal force behind the advocacy for advertising on the broadcaster. Mr Johns’ reasoning was said to be that limited advertising (of five minutes per hour) would provide the broadcaster with supplementary funding which could then be used to assist it to fulfil its charter obligations by producing local content.[5]

SBS advertising policy remained unchanged until June 2006, when:

… the SBS Board reinterpreted the concept of natural program breaks and approved the inclusion of in-programming advertising across the SBS schedule. SBS managing director at the time, Shaun Brown, defended this broader interpretation of natural program breaks using a similar argument to that which Brian Johns had used—the SBS Charter requires the broadcaster to produce Australian content, and funding needed to be found to meet this charter obligation.[6]

The introduction of in-program advertising, particularly in news services, drew considerable criticism from SBS audiences. SBS historian Ien Ang comments:

This was seen as the worst example of commercialisation, tainting the news and its special role within public service broadcasting. By introducing a commercial element into the news, public trust and public interest were seen as threatened. Critics argued that the news was now vulnerable to ratings pressures and its editorial independence was in danger.[7]

Almost 30 per cent of SBS funding averaged over recent years now comes from advertising.[8] It has been claimed elsewhere that this situation is the result of the failure of both Labor and Coalition Governments to fund Australia’s public broadcasters adequately.[9] Regardless of the reason, however, it appears as Brian Johns, Shaun Brown and others, such as past SBS board member and now Chair of the Corporation, Melbourne multiculturalist Dr Hass Dellal, have stated—advertising has become fundamental for SBS survival.[10]

The National Commission of Audit and the Lewis Inquiry into the efficiency of the ABC and SBS expressed the view that both public broadcasters could, and should, rely less on government support.[11] Indeed, the Lewis Report specifically suggested that there was scope for SBS to increase its revenue under a more flexible advertising regime as proposed in this Bill and a previous iteration of the legislation, the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015.[12] The Lewis report presented a number options, such as increasing advertising time during sporting events, introducing branded content and sponsorship in particular program genres, as well as increasing advertising during peak viewing times.[13]

The Explanatory Memorandum to this Bill argues in support of advertising flexibility that in 2015–16 commercial free-to-air television broadcasters (excluding WIN) earned $3.7 billion from advertising, while over the same period SBS only earned $76.2 million from advertising and sponsorship. The SBS revenue represents a two per cent share of advertising revenue, despite its approximately seven per cent share of prime time audiences. According to the Explanatory Memorandum, the discrepancy between audience share and revenue suggests that SBS ‘could be earning significantly more in terms of advertising revenue’ and that regulations which limit advertising in prime time are ‘in part’ responsible for this situation.[14]

Committee consideration

Senate Environment and Communications Legislation Committee

The Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 was introduced during the 44th Parliament to give effect to the same flexible advertising arrangements and product placement provisions as are introduced in this Bill. The 2015 Bill was referred to the Senate Environment and Communications Legislation Committee for inquiry.

The Senate Committee received 27 submissions and held one public hearing before reporting its findings in May 2015.[15]

The Senate did not consider that the proposed amendments represent a move to establish SBS as a fourth fully commercial television channel. Nor did the Committee consider that the proposed amendments would interfere with the delivery of SBS's Charter obligations. It was convinced that SBS had provided it with

… clear evidence that [the broadcaster] has managed its existing advertising and sponsorship announcements arrangements for many years and continued to deliver its Charter obligations. The committee has been assured that SBS's programming commissioning and content decisions have not been, or will be, driven by advertising or sponsorship announcement revenue concerns.

In addition, the committee notes that the SBS board will be required to develop governance and reporting requirements regarding the use of product placements. This requirement mirrors that already applied to advertising and sponsorship announcements. Together, they will provide transparency to SBS's advertising, sponsorship announcements and product placement.[16]

Labor Senators on the Committee and the Greens’ Senator Ludlam disagreed with the majority Committee report and were persuaded that risks to SBS charter obligations, editorial independence, the Australian screen industry and commercial network revenues were significant enough for them to consider then Bill should not pass.[17] Senator Nick Xenophon also dissented from the majority report.[18]

At the time of writing, this Bill had not been referred to the Senate Committee for further inquiry.

Parliamentary Senate Standing Committee for Selection of Bills

On 29 March 2017 the Selection of Bills Committee recommended that this Bill was not referred to a committee for inquiry.[19]

Senate Standing Committee for the Scrutiny of Bills

The Standing Committee for the Scrutiny of Bills noted in its March 2017 digest that it had no comment to make on this Bill.[20]

Policy position of non-government parties/independents

The Australian Greens have been traditionally vehemently opposed to in-program advertising on SBS. In 2009, and again in October 2010, the party introduced legislation to prohibit the practice, with the intention, according to Greens Senator Scott Ludlam, of putting the onus back on government to support the broadcaster.[21]

In relation to the 2015 proposal to change the advertising regime on SBS, Senator Ludlam was reported in the press as saying that the Government was attempting to ‘blackmail’ the Senate into supporting the advertising changes—a reference to the efficiency funding cuts which could be potentially offset by increased advertising revenue.[22] In an interview with the online newsletter Crikey Senator Ludlam remarked that he was:

… concerned about the remarkably divergent estimates about the amount of money the proposal would actually raise (the commercial TV lobbies say it would be $200 million over five years, but SBS says it expects around half that). [The Greens] won't be in a position to announce our final voting intention until we know who's right and who's wrong about the estimates, and secondly, till we know what'll happen if, as is looking likely, the [B]ill fails—we want to know whether the government is going to go ahead and cut SBS' finances anyway …[23]

Senator Ludlam was one of three Environment and Communications Committee members who wrote a non-Government Senators dissenting report to the findings of that Committee on the 2015 Bill, and in the debates on the Bill, Senator Ludlam asked the Government:

… when will you actually be happy? Will you be happy if this [B]ill is passed and SBS starts broadcasting the same amount of advertising during prime time as commercial TV stations? Is that what this is about? Will you be happy when SBS is allowed to have as much product placement in its programs as an episode of, say, MasterChef or The Block? Is that what this is about? Will you be happy if the creeping commercialisation of the SBS spreads to the ABC and we start seeing advertising breaks on 7.30? Is that where this is going? Will you be happy if SBS is eventually rolled into the ABC under the cover of meeting more of your efficiency targets? Will you be happy if both get privatised or broken up to create a fourth commercial free-to-air TV network? Is that what this is about?[24]

The Greens voted against the 2015 Bill and there is currently no indication that the party has changed its stance on changing the rules for advertising on SBS.[25]

While in opposition before 2007, Labor criticised the introduction of in-program advertising on SBS, but during its term in government between 2007 and 2013, it did little to reverse the situation. Indeed, in response to a series of questions from the Save Our SBS organisation prior to the 2010 election it made clear that its intention was not to disallow in-program advertising ‘as it would substantially reduce the amount of funding available to SBS to support the provision of high quality and diverse programming’.[26]

However, Australian Labor Party (Labor/ALP) Senators Anne Urquhart and Lisa Singh also signed the SBS Bill inquiry dissenting report, which primarily expressed concern the 2015 Bill was a legislative mechanism to cut SBS funding.[27] In citing concerns raised in submissions to the inquiry, the dissenting report concluded that the 2015 Bill represented a significant risk to SBS Charter obligations and editorial independence as well as to revenues for the Australian screen industry and commercial network revenues. The non-Government Senators dissenting report recommended that the 2015 Bill should not be passed by the Parliament.[28]

In November 2014 Labor indicated that it was opposed to budget cuts to SBS and the ABC.[29] Senators Urquhart and Singh’s declaration in the dissenting their 2015 report and the contributions of Labor speakers to debate on the 2015 Bill confirmed the Party’s opposition to the legislation, with the ALP voting against its passage.[30] Since the introduction of this Bill there has been no indication that its position will change.

Senator Nick Xenophon also dissented from the majority Committee report on the 2015 Bill. Senator Xenophon argued in his report:

SBS holds a special place in Australian society. Its diverse programming is reflective of our ever increasing cultural diversity. I believe the non-commercialisation of SBS is essential to maintaining this broadcaster's ability to continue to produce and televise programs that other networks would be unwilling to broadcast. While the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 does not increase the total amount of advertising above the current limit of 120 minutes in any 24 hours, it will allow advertising to increase from 5 to 10 minutes in any hour of programming. Furthermore, this Bill will make product placement permissible, a measure I believe will constrict SBS's ability to offer the frank commentary it is renowned for.

I must emphasise that I find the cuts to SBS's funding repugnant. I am concerned that this is the beginning of a slippery slope as governments try to wean SBS off public funding and towards an advertising revenue dependant model. SBS has a specific charter to fulfil a specific need, and any measures that impact on SBS's ability to do so must be rejected.[31]

The Senator added:

I also wish to put on the record that I do not support SBS's current advertising activities, although I recognise they have been put in a difficult position through no fault of their own. The government should ensure that SBS is adequately funded without the need for this retrograde measure.[32]

Senator Xenophon was not in the chamber to vote on the 2015 Bill. There has no public comment from the Senator on this Bill at the time of writing this digest, nor any indication that he or his party, the Nick Xenophon Team (NXT) will vote in support of the current Bill.[33]

Senator David Leyonhjelm, from the Liberal Democratic Party indicated in response to the previous iteration of this Bill that he was likely to support changes to SBS advertising arrangements. Senator Leyonhjelm declared that he would be happy if SBS so decreased its dependence on taxpayers that it no longer required any government funding to operate.[34] The Senator did not vote on the 2015 Bill. Senator Cory Bernardi (Australian Conservatives), who was a member of the Liberal Party in 2015, voted in favour of changes proposed in the 2015 Bill.[35] He has made no comment at present on this Bill.

At the time of writing this digest it appears there has been no comment from other Parliamentarians on the proposals in this Bill.

Position of major interest groups

Opposition to changes

Immediately following the introduction of the 2015 SBS Bill, Free TV Australia urged the Senate to block the legislation. Free TV Chairman Harold Mitchell claimed the advertising proposals would, in effect, ‘create a new commercial broadcasting licence by stealth’ as SBS would be able to schedule the same amount of prime time advertising as commercial broadcasters and it would target the same advertisers.[36]

The Free TV Chairman contested claims by the Government and SBS that the broadcaster would only earn an additional $28.5 million over four years from the changes proposed in this Bill, arguing that there was ‘no transparency’ for this figure.[37] He claimed in fact that an independent analysis ‘demonstrated that SBS will have the potential to earn an additional $148 million in advertising revenue over four years’.[38]

Free TV’s press release maintained a position the lobby group had taken previously, as did its submissions to consultation on the Regulation Impact Statement (RIS) for the 2015 Bill and the Senate inquiry into that Bill. The Free TV submission to the Department declared:

Commercial broadcasters should not be required to subsidise funding cuts to a government-funded broadcaster. Free TV members pay extremely high licence fees on top of Australian corporate taxes. Unlike SBS they are also subject to increasingly onerous Australian content obligations.[39]

According to Free TV, if the 2015 SBS Bill had been passed, there would have been an ‘inevitable’ loss of revenue for commercial broadcasters, particularly in regional areas. The consequences of this loss of revenue would have been the production of less Australian content, which in turn would have resulted in industry job losses.[40] Free TV’s argument was that while commercial broadcasters are required to satisfy ‘heavy’ Australian content obligations, Australian programming comprises only ten per cent of the SBS broadcasting schedule. Free TV insisted this would not have altered as a result of increased commercial revenue gains.[41]

It could be argued in response to the Free TV claims that they were not relevant to proposals that were, and continue to be principally intended to offset revenue losses from government efficiency dividends, rather than provide a new, additional source of income. In addition, given that the Charter obligations of SBS are to provide services which satisfy the needs of a multicultural society (see Appendix A for more detail), it would be impossible for SBS to attempt to produce more in-house content unless it was able to raise, or be provided with a phenomenal increase in revenue and staffing bases. Therefore, its recourse to foreign programming as a major source of programming, rather the generation of Australian content, could be considered both practical and justifiable.

Free TV also questioned the assertion made in the 2015 Regulation Impact Statement (which is repeated in the RIS for the current Bill) that ‘it is not certain that any increase in SBS advertising spend will draw away revenue that would otherwise have gone to other commercial free-to-air broadcasters’.[42] It argued that there is a finite amount of advertising money available and that SBS and commercial broadcasters target the same advertisers for that finite resource.[43]

In response, the current Explanatory Memorandum contends that changes to the SBS advertising regime will be most unlikely to result in a significant loss of revenue for other commercial broadcasters; it considers that even if SBS were to earn an additional $20 million a year as a result of the proposed changes, ‘this would result in a loss of less than one per cent for any individual broadcaster’.[44]

Free TV disputed the 2015 RIS claim (also repeated in the RIS for the current Bill) that the ten-minute hourly cap was ‘well below the hourly limits imposed on the commercial broadcasters’.[45] It argued that because advertising under the SBS Act does not include program promotions, SBS could choose to broadcast four minutes of program promotions per hour and still have 84 minutes of ‘non-program matter’ available to sell as advertising space in prime time. Commercial free-to-air television, on the other hand, because its 15 minutes limit on non-program content includes promotion, could be in a situation where it is permitted only the broadcast of 78 minutes of ‘non-program matter’.[46]

In response, the current Explanatory Memorandum justifies the Bill on the grounds that not all content on SBS is attractive to commercial advertisers and that in some regional markets the broadcaster struggles to fill five minutes of advertising per hour.[47]

Free TV was similarly adamant that SBS should not be allowed to use product placement to supplement its revenue—for the same reasons it opposed changes to the advertising regime on the broadcaster.[48]

The Free TV remarks supplemented comments made previously by representatives of the major free-to-air commercial networks in relation to public broadcasters generally, and specifically with relation to SBS advertising. Network Ten Chief Executive in 2014, Hamish McLennan, for example, asserted that commercial businesses would be made to ‘foot the bill for the public broadcasters’ ongoing inefficiencies’ if legislation of the type proposed in this Bill was passed.[49] Seven West Media’s Chief Executive, Tim Worner, also believed commercial broadcasters were being called upon to fund the ABC and SBS; he objected to commercial broadcasters being asked effectively ‘to put our hands in our pockets’ to fund public broadcasters.[50]

In its submission to the 2015 Senate inquiry, Foxtel remarked that while there had been considerable debate about the effect changes to SBS advertising requirements may have on free-to-air broadcasters, there had been little consideration of the impact they would have on advertising revenues for subscription television. While Foxtel acknowledged that its primary source of income is subscriptions, it noted that nevertheless, a sizeable proportion of its income comes from advertising. According to Foxtel, this would be affected if SBS was given permission to introduce more advertising in prime time and to include product placement in such areas as sport and food programming, both of which represent important niche programming areas for subscription television.[51]

SBS supporters have been opposed to in-program advertising on the broadcaster for some time. Before the 2012–13 Budget, for example, the Save Our SBS group encouraged people to send messages urging the Government to increase funding for the broadcaster and to instigate the removal of ‘disruptive’ commercial breaks. Over nine thousand people responded to the Save Our SBS plea.[52] In response to the proposals in the 2015 Bill, film critic Margaret Pomeranz and journalist Quentin Dempster, in conjunction with Save Our SBS and advocacy group GetUp, launched a further plea for public support through a petition to implore the Government to preserve the ‘integrity’ of the multicultural broadcaster.[53] And the Save Our SBS President, Steve Aujard, stated that, if passed, the proposed changes would ensure SBS looked ‘no different from commercial TV’.[54]

In response to the 2015 RIS, Save Our SBS argued that the changes will force the broadcaster:

… to concentrate on programs that aggregate audiences and demographics to enhance advertising revenues. The Charter requires that SBS broadcast programs in the preferred languages; contrary to this, the dominance of English language-only programs on SBS ONE in television primetime (compared to the period before SBS commenced in-program advertising), indicates that commercial bias is already occurring. Extending this through product placement and ad averaging (actually a doubling of primetime advertising) will destroy SBS's raison d'être.[55]

Save Our SBS agreed with the commercial television argument that the changes proposed in the 2015 Bill, and reintroduced in this Bill, will result in SBS being able to air 14 minutes of advertising (and promotion) in prime time. It reinforced this argument by pointing out that its ‘spot checks’, conducted since 2009, consistently show that the principal SBS television station airs its currently allowed advertising allocation plus four minutes of promos per hour from 6pm to 12 midnight.[56]

An important argument made by Save Our SBS was that increased dependence on advertising may to lead to SBS becoming ‘more populist’. Save Our SBS cites internal studies undertaken in 2008 and 2013 in support of its contention. These studies ‘strongly suggest that SBS will be less efficient in Charter delivery if it were to double primetime advertising’. Save Our SBS believes the reason that this will be so is that in-program advertising makes advertisers the clients of SBS with the sole purpose of on-selling audiences to advertisers. The SBS viewer becomes a product to be on-sold. In Save Our SBS’s view, when advertising was between programs only, the viewer was more clearly the client.[57]

The Lewis efficiency review also made this point:

… there will be a greater pressure on SBS management to consider the trade-off of delivering on commercial expectations, against delivering those functions described in the SBS Charter.[58]

Peter Lewis did not attempt to consider how SBS could attempt to balance what must be acknowledged are critical tensions for a public broadcaster increasingly tasked with funding revenues while delivering to a diverse audience.

Findings from the Save Our SBS 2013 study are shown in Figure 1 below. They indicate that of the 2,044 study participants, 72 per cent considered SBS less faithful to its Charter since the introduction of in-program advertising and 94.5 per cent wanted the broadcaster to devise a plan to remove all advertising from within programs:

Figure 1: adherence to SBS Charter as result of in-program advertising

Source: Save Our SBS, Submission to the SBS Community Advisory Committee and the SBS Board.[59]

In October 2016, Save Our SBS expressed concern following remarks at a Senate Estimates committee hearing that the government intended to increase advertising on the broadcaster.[60] The concern, however, was based on an incorrect assessment of the comments and clearly an increase in overall advertising time is not associated with this Bill. Nonetheless, the lobby group is currently conducting a further survey on audience reaction to advertising on SBS.[61]

In its submission to the 2015 inquiry the lobby group GetUp maintained proposed changes to SBS advertising rules would have ‘a detrimental impact on the integrity’ of the broadcaster, placing the needs of advertisers before the needs of viewers as programming is assessed on its ability ‘to raise revenue’.[62] GetUp also cited the findings of the Save Our SBS studies into in-programming advertising and concurred with the assessment that it had made it increasingly difficult for SBS to meet its Charter obligations as a result. Product placement was also criticised as GetUp saw this as a means to threaten the independence of journalists and restrict presenters in making comments that could be negatively perceived by companies whose products were featured in placements. GetUp concluded the 2015 proposals were a means through which government could, and would justify further reductions to the SBS budget.[63]

In favour of changes

The SBS submission to the 2015 Senate inquiry disputed that changes to its advertising regime would interfere with its Charter obligations.[64] According to the SBS submission, as SBS has had to manage how it deals with the situation of being a public broadcaster with commercial activities since 1991, it has in place policies and practices which deal with this situation. Hence, it is well-positioned to deal with increased flexibility in advertising and sponsorship, while maintaining the integrity of its Charter.[65] The broadcaster insisted that additional revenue would not only assist it to maintain investment in multicultural and multilingual Australian programs and services, but it would also help to secure the future sustainability of the organisation—without compromising service levels.[66]

SBS was adamant that its ability to make efficiency changes has been exhausted, so if the proposed changes in flexibility for advertising were not accepted, it would be forced to make immediate cuts to programs and services.[67] Its first move in this direction was to sever its association with Freeview—at a saving of around $630,000 per year.[68]. The action prompted Save Our SBS to comment that the broadcaster could save a further $25.0 million over five years if it also severed its carriage agreement with Foxtel.[69] There would therefore be no need for it to compromise services.[70] The issue was not as clear cut as Save Our SBS indicated, however, for as one source commented a third of Australian households have a Foxtel subscription, and anecdotal evidence suggests Foxtel subscribers view their free-to-air entirely through the Foxtel platform. So withdrawing from the Foxtel carriage service may have ‘effectively shut out SBS to up to 30% of Australian homes’, as well as affect other sponsorship opportunities.[71]

In the 2015 Mid-Year Economic and Fiscal Outlook (MYEFO) the Government compensated SBS for the expected loss of revenue from the advertising rule changes by providing the broadcaster with an extra $4.1 million in funding.[72] This funding was cited as ‘a reprieve, not a restoration’ as it was only for 2015–16.[73] The reprieve continued in the 2016–17 and 2017–18 Budgets when the broadcaster received a further $6.9 million and $8.8 million in compensation.[74]

In 2015 the Federation of Ethnic Communities’ Councils of Australia (FECCA) supported the proposed changes to SBS advertising rules.[75] The FECCA argued that its support was premised on its assessment of the financial situation of SBS; advertising changes were a means through which SBS could make some recompense for lost government funding support. At the same time the FECCA noted that it had ‘repeatedly expressed its disappointment’ over funding reductions to the broadcaster and its concern that these cuts may result in ‘SBS losing its core multicultural focus, providing a major impediment to enabling the exchange of important information and promoting the diversity of our society’.[76]

Further viewpoints

In a 2014 interview with the online journal Crikey, Max Baxter, Chief Executive of advertising agency Universal McCann (UM) Australia, regarded the reaction to changes to SBS advertising rules from the commercial television broadcasters as ‘extreme’.[77] Mr Baxter did not believe more advertising dollars for SBS would significantly detract from commercial revenues.[78] Paul Brooks, national head of partnerships and investments at the Carat media company, also considered any impact from added SBS revenue would be negligible and that figures quoted by the commercial networks were ‘inflammatory’. Mr Brooks cast doubt on the SBS estimation of potential revenue, considering it to be too high.[79]

Steve Allen of Fusion Strategy advertising agency agreed with these assessments and noted that one significant reason SBS is unlikely to affect the fortunes of the commercial networks is because of its small audience share—around five per cent of the metropolitan audience.[80] Mr Allen made a number of other relevant points referring, for example, to the rise of Internet advertising and the movement to advertisers using self-publishing, as far greater threats to commercial television fortunes than advertising on SBS. Moreover in Mr Allen’s view, which accords with findings from the Save Our SBS research, SBS is ‘hamstrung’ when it comes to introducing more advertising, for if it adds too many commercial breaks, it is vulnerable to viewer backlash.[81]

At the same time, Mr Allen acknowledged that there are advertisers interested in targeting the linguistically and culturally diverse audience of SBS as well as what he labelled the broadcaster’s wealthy, niche audience. Max Baxter agreed, concluding:

SBS plays a niche role within the broader media mix for advertisers … The type of advertiser who is spending big dollars on Seven, Nine or Ten isn’t the type who’ll lift their dollars and drop them into SBS. The demographics are just so different. But you can use SBS as a specialist supplement to your core programming strategies. You don’t buy a commercial network or SBS—you buy them together.[82]

In its submission to the 2015 Senate inquiry the Communications Law Centre (CLC) argued that if the SBS advertising regime were to be made more flexible, then ‘the regulatory framework that supports the broadcaster should be strengthened to ensure that the character and quality of the broadcaster’s services do not suffer’. This should apply in particular to the SBS Act and codes of practice and guidelines so as to ensure the broadcaster’s commitment to its Charter is maintained.[83]

As the CLC was concerned that introducing product placement had the potential to mislead audiences, it called for regulatory changes and changes to guidelines to emphasise that advertisements should be ‘ readily distinguishable from programming’. It added that in the case of news, current affairs or other factual programing that code provisions ‘should exclude or strictly limit’ product placement. Moreover, product placement should be defined in order to clarify what advertising practices are permitted.[84]

Financial implications

It is anticipated in the Explanatory Memorandum to this Bill that the changes to advertising requirements for SBS will deliver an increase in advertising revenue of $27.4 million over four years from 2017–18.[85] This figure has been revised down from a calculation based on SBS estimates and conclusions drawn in the 2015 Explanatory Memorandum from audience share statistics for SBS that the broadcaster could earn up to five per cent of television airtime revenue per annum.[86]

As noted earlier in this Digest, free-to-air television broadcasters dispute low estimations for potential financial benefits for the public broadcaster. They cite independent analysis in support of their claims that SBS has the potential to earn nearly five times more than has been estimated.[87]

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible as it does not engage any applicable rights or freedoms.[88]

Parliamentary Joint Committee on Human Rights

The Parliamentary Joint Committee on Human Rights considers that the Bill does not raise human rights concerns.[89]

Key issues and provisions

This Bill consists of two Schedules. The following provides details of the major changes in the Schedules. The Explanatory Memorandum provides explanation of all proposed changes.

Schedule 1: advertising flexibility

Item 1 of Schedule 1 repeals paragraph 45(2)(b) of the SBS Act and inserts a new paragraph which varies existing requirements for advertising and sponsorship announcements on SBS. Under the current SBS Act SBS is allowed to broadcast no more than five minutes of advertising and sponsorship announcements per hour over a 24-hour period—that is, 120 minutes each day. Proposed paragraph 45(2)(b) will allow the broadcaster to include up to ten minutes of broadcasting per hour in times it may choose, up to a limit of 120 minutes per 24-hour period.

As noted previously in this Digest, the Government argues that this will provide the broadcaster with more flexibility to determine the times it will broadcast advertising and sponsorship announcements. While this amendment will potentially increase advertising revenue, it will not increase the overall amount of advertising allowed on the broadcaster.

Comment

As noted earlier in this Digest, in 2015 the proposed change in an earlier iteration of this legislation was extensively criticised. Commercial broadcasters saw it as effectively transforming SBS into a fourth commercial broadcaster; thereby reducing their perspective client pool. Supporters of public broadcasting were equally concerned about the commercialisation of SBS. Their concerns were that allowing more advertising will compromise the principles behind public service broadcasting—principles of media that is financed by the public, for the public, free from political interference and pressure from commercial forces. Moreover, that in the case of SBS, further commercialisation will undermine multicultural broadcasting and make it increasingly difficult for SBS to fulfil its charter obligations.

The SBS submission to the Senate inquiry into the 2015 Bill noted that many public service broadcasters accept advertising under certain conditions (see the list provided by SBS at Appendix D of SBS’ submission).[90] At the same time, it has been argued elsewhere that taking the advertising option has presented difficulties for public service broadcasters. In the United States, for example, a trend towards commercialisation has been criticised as driving public broadcasting 'closer to the programming and audience considerations that guide commercial broadcasting and against which it is assumed that public broadcasting must stand'.[91] Increased commercialisation has also been seen as threatening the maintenance of other forms of revenue for public broadcasting.[92]

See also what could be considered an extreme example of commercialisation—the New Zealand experience—in Box 1 below.

Box 1: the New Zealand public broadcasting experience

In New Zealand, the original intention in creating a state broadcasting system was that it was to be based on the BBC model. Hence, as early as 1935–36 radio was nationalised and an inquiry into the introduction of television recommended a state monopoly.

Despite the intention, however, with regards to television practical considerations intervened to ensure a different reality. Because of its small population, which could not generate sufficient income through licence fees to support fully state-funded services, New Zealand public service television was allowed to accept advertising as a supplementary source of income from the time it was introduced in 1960.

As funding from advertisers increased during the 1970s and early 1980s, public funding declined. By 1989, television was more than 90 per cent dependent on advertising revenue.[93]

According to New Zealand academic, Trisha Dunleavy, while the Clarke Labour Government elected in 1999 could not reverse the commercialisation of TVNZ, it attempted to revitalise the concept of public broadcasting by imposing a public service charter.[94] The Charter involved a dual remit whereby the broadcaster had to maintain commercial performance, while simultaneously providing public service broadcasting.[95] Two non-commercial channels (TVNZ 6 and TVNZ 7) were given specific government funding of NZ$79.0 million over six years from 2006 and these were relatively successful in attracting audiences.[96]

In 2011 a National Government passed legislation to repeal the TVNZ Charter. An amended television Act specified the functions of TVNZ are for it to be a successful national television and digital media company providing a range of content and services on a choice of delivery platforms and maintaining its commercial performance.[97] The National Government did not renew funding for stations TVNZ 6 and 7.

In the 1980s a statutory body, NZ on Air, was introduced to act as a funding agency to promote New Zealand content in programming. There are a number of limitations on this agency, which include its obligation to consider the 'potential size of the audience likely to benefit' from projects funded.[98]

Commentator Paul Norris calls TVNZ a lost cause, a public broadcaster in name only and New Zealand academic Trisha Dunleavy argues: ‘New Zealand, to its national shame and to the detriment of potentials for a better informed society and better functioning democracy, does not have a centrepiece [public service television] channel: one that operates entirely free from the demands of advertisers, is universally available to citizens at no direct cost, and that caters to a general audience (from toddlers to retirees)’.[99]

Commercial free-to-air broadcasters posit that allowing more advertising revenue to flow to SBS will effectively result in its becoming a commercial network. However, the proposed changes in this Bill would most likely not result in SBS receiving financial support from advertising changes that would approximate anywhere near that which the commercial broadcasters currently enjoy from government. For example, commercial free-to-air broadcasters have consistently complained about licence fees and lobbied for reductions. This lobbying has increased as the popularity of new online media offerings has threatened their traditional sources of revenue.[100] The previous Government responded to the broadcasters’ complaints by making two reductions to licence fees and the current Government further reduced these fees in 2016.[101]

Given the amount of revenue to government forgone as a result of licence reductions for enterprises that are purely profit-generated, the trepidation expressed by the commercial free-to-air broadcasters appears excessive. It could be argued that this is especially so given that SBS is predicted to generate less than $30 million in additional revenue over four years from the proposed variation in advertising rules. Reports are that the commercial free-to-air broadcasters currently benefit from licence rebates by at least $100 million collectively each year. Even if SBS were to achieve greater than anticipated financial gain annually, it is unlikely that it would reach this figure.[102]

In addition, as one report comments, licence fee rebates are not the only benefits that commercial free-to-air broadcasters enjoy; they also gain from other government largesse. One example of this largesse can be seen in insistence of successive governments in retaining an anti-siphoning list, which prevents certain televised events as listed by the government, from being appropriated or ‘siphoned off’ by pay television operators so that only those that subscribe to a pay service are able to view those events.[103] It is claimed the benefits from such largesse in total amount to over $1.0 billion per year.[104]

Schedule 2: product placement

Item 1 of this Schedule proposes to define advertisement in the SBS Act for the purposes of distinguishing advertisements from product placement. The Schedule does not define product placement, but nonetheless, item 3 specifically authorises SBS to broadcast product placements and to include product placement on its digital services (item 8).

At the same time, items 4 to 6 increase the current obligation on the broadcaster to develop and publicise guidelines on the kinds of advertisements and sponsorship announcements ‘that it is prepared to broadcast’ also to address the kind of product placements it is prepared to include in the programs it broadcasts.

Comment

Allowing SBS to earn money from product placement in the programs it commissions is in direct contrast to the situation that currently exists in the United Kingdom. For the most part the British Broadcasting Corporation (BBC) does not allow product placement; it must not commission, produce or co-produce output for its licence fee funded services which contains product placement. All programmes made by the BBC, or an independent producer for broadcast on BBC licence fee funded services, also must be free of product placement.[105]

The BBC can broadcast an acquired programme containing product placement if it receives no financial benefit from the placement, but it must not acquire a programme from a third party on the condition that the product placement within the programme will be broadcast.[106]

Similarly, Australia’s principal public broadcaster generally prohibits product placement. The ABC states that ‘[p]roduct placement and other forms of embedded or surreptitious advertising are prohibited’.[107] The broadcaster’s editorial guidelines allow that in ‘exceptional cases’, it may use content that contains product placement provided:

•       the ABC played no role in the commissioning or production of the content

•       the content has intrinsic editorial value

•       the product placement is not unduly frequent or unduly prominent and

•       the ABC’s editorial independence and integrity are not undermined.[108]

It could be argued that because SBS operates under a hybrid model the above restrictions should not apply and that product placement is a less intrusive way for the broadcaster to supplement government funding than direct advertising. However, SBS purists would most likely not accept this argument; they would take the view that advertising is advertising, whichever way it is packaged.

Appendix A: SBS Charter

(1)              The principal function of SBS is to provide multilingual and multicultural radio, television and digital media services that inform, educate and entertain all Australians and, in doing so, reflect Australia's multicultural society.

(2)               SBS, in performing its principal function, must:

              (a)              contribute to meeting the communications needs of Australia's multicultural society, including ethnic, Aboriginal and Torres Strait Islander communities; and

              (b)              increase awareness of the contribution of a diversity of cultures to the continuing development of Australian society; and

              (c)               promote understanding and acceptance of the cultural, linguistic and ethnic diversity of the Australian people; and

              (d)               contribute to the retention and continuing development of language and other cultural skills; and

              (e)               as far as practicable, inform, educate and entertain Australians in their preferred languages; and

              (f)               make use of Australia's diverse creative resources; and

              (g)               contribute to the overall diversity of Australian television and radio services, particularly taking into account the contribution of the Australian Broadcasting Corporation and the community broadcasting sector; and

              (h)               contribute to extending the range of Australian television and radio services, and reflect the changing nature of Australian society, by presenting many points of view and using innovative forms of expression.[109]

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[1].              Enabling legislation was the Broadcasting and Television Amendment Act 1977.

[2].              Broadcasting and Television Amendment Act 1977, section 79Z.

[3].              I Ang, G Hawkins and L Dabboussy, The SBS story: the challenge of cultural diversity, University of New South Wales Press, Sydney, 2008, p. 249.

[4].              Special Broadcasting Service Act 1991, section 45.

[5].              Ang et al, op. cit., p. 250.

[6].              R Jolly, The ABC: an overview (updated), Research paper series, 2014–15, Parliamentary Library, Canberra, 2014, p. 47. Cites Ang et al, pp. 250–51.

[7].              Ang et al, op. cit., p. 204.

[8].              Figure deduced from analysis of recent SBS Annual Reports.

[9].              Jolly, op. cit., p. 48.

[10].              Ibid., cites F Farouque, ‘In defence of SBS’, The Sydney Morning Herald, 5 August 2010.

[11].              Australian Government, ‘Part 2: expense measures’, Budget measures: budget paper no. 2: 2014–15, p. 66; National Commission of Audit (NCoA), Towards responsible government: phase one, NCoA, Canberra, February 2014, pp. 193–95; and Department of Communications, ABC and SBS efficiency study: draft report, (Lewis report), Department of Communications, Canberra, April 2014.

[12].              Parliament of Australia, ‘Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 homepage’, Australian Parliament website.

[13].              Lewis report, op. cit., p. 85.

[14].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 5.

[15].              Senate Environment and Communications Legislation Committee, Inquiry into the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 [Provisions], The Senate, Canberra, May 2015.

[16].              Ibid., p. 17.

[17].              Non-government Senators, Dissenting report, Senate Environment and Communications Legislation Committee, Inquiry into the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, The Senate, Canberra, May 2015.

[18].              Senator Nick Xenophon, Dissenting report, Senate Environment and Communications Legislation Committee, Inquiry into the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, The Senate, Canberra, May 2015.

[19].              Selection of Bills Committee, Report, 4, 2017, The Senate, 30 March 2017.

[20].              Standing Committee for the Scrutiny of Bills, Scrutiny digest, 4, 2017, 29 March 2017, p. 12.

[21].              S Ludlam, ‘Second reading speech: Special Broadcasting Service Amendment (Prohibition of Disruptive Advertising) Bill 2009’, Senate, Debates, 7 September 2009, p. 5737.

[22].              M Knott, ‘Bid to double SBS ads comes under fire’, The Sun Herald, 1 February 2015, p. 10.

[23].              M Robin, ‘SBS ad averaging bill likely to be stymied in the Senate’, Crikey, 11 March 2015.

[24].              S Ludlam, ‘Second reading speech: Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 ’, Senate, Debates, 16 June 2015, p. 3501.

[25].              Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, Second Reading, Division, Senate, Debates, 24 June 2015, p. 4389.

[26].              Save Our SBS, ‘Labor SBS policy for the 2010 federal elections’, Save Our SBS website, 20 July 2010.

[27].              Non-government Senators, Dissenting report, Senate Environment and Communications Legislation Committee, op. cit.

[28].              Ibid.

[29].              ‘Take a stand for “our” ABC, implores Shorten’, The Advertiser (Adelaide), 24 November 2014, p. 12.

[30].              For example, the second reading speech by Jason Clare, J Clare, ‘Second reading speech: Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures)’, House of Representatives, Debates, 26 May 2015, p. 4581 and the results of the vote in the House of Representatives, Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, Second Reading, Division, House of Representatives, Debates, 26 May 2015, p. 4581.

[31].              Senator Nick Xenophon, Dissenting report, Senate Environment and Communications Legislation Committee, op. cit.

[32].              Ibid.

[33].              Second Reading, Division, Senate, Debates, 24 June 2015, op. cit.

[34].              Robin, ‘SBS ad averaging bill’, op. cit.

[35].              Second Reading, Division, Senate, Debates, 24 June 2015, op. cit.

[36].              Free TV Australia, SBS Legislation creates 4th commercial TV licence by stealth, media release, 24 March 2015.

[37].              Ibid.

[38].              Ibid.

[39].              Free TV Australia, Submission to Department of Communications, Inquiry into SBS advertising flexibility: regulation impact statement, (RIS submission), 10 March 2015, p. 2.

[40].              Ibid.

[41].              Ibid.

[42].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, p. 9; Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 9.

[43].              The Free TV submission cited Nielson Adex data which reports that 85 per cent of advertisers on SBS also advertise on commercial free-to-air television and PricewaterhouseCoopers analysis from Australian Entertainment and Media Outlook 2014-2018 findings that growth in free-to-air television advertising revenues has ‘remained flat since 2008’, and has a Compound Annual Growth Rate (CAGR) forecast of just 1.4 per cent over the next five years, Free TV Australia, Submission to Department of Communications, op. cit., p. 7. Note references for the sources cited are not provided, but are included in the Free TV, Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, 13 April 2015.

[44].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 9.

[45].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, p. 6; Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 7.

[46].              Free TV Australia, RIS submission, op. cit., p. 8.

[47].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 12.

[48].              Free TV Australia, RIS submission, op. cit., p. 10.

[49].              D Davidson, ‘If SBS ads double, we should get our licence fees back: Gyngell’, The Australian, 20 November 2014.

[50].              Ibid.

[51].              Foxtel, Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, submission no. 2, 13 April 2015.

[52].              Save Our SBS, ‘Why SBS received a funding increase’, Save Our SBS website, 8 May 2012.

[53].              Save Our SBS and GetUp!, ‘Preserve its integrity! Don’t increase ads on SBS’, CommunityRun website.

[54].              Save Our SBS, Government wants to fully commercialise SBS with new law, media release, 24 March 2015.

[55].              Save Our SBS, Submission to the Department of Communications, Commercialising SBS by stealth: a response to the SBS advertising flexibility regulation impact statement, 15 March 2015, p. 6.

[56].              Ibid., p. 7.

[57].              Ibid., p. 5.

[58].              Lewis report, op. cit., p. 85.

[59].              Save Our SBS, A study of 2044 viewers of SBS television on advertising, Charter, relevance and other matters: a submission to the SBS Community Advisory Committee and the SBS Board, submission to the SBS Community Advisory Committee and the SBS Board, Save Our SBS Inc, Melbourne, July 2013, p. 12.

[60].              N O’Loughlin, Senate Environment and Communications Committee, Official committee Hansard, 18 October 2016, p. 31 and Save Our SBS, ‘SBS to double primetime advertising if bill passes’, comment page on website, 18 October 2016.

[61].              Save Our SBS, ‘Survey: is SBS doing it right?’, Save Our SBS website, 1 April 2017.

[62].              GetUp!, Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, submission no. 4, 14 April 2015.

[63].              Ibid.

[64].              SBS, Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, submission no. 7, 13 April 2015.

[65].              Ibid., p. 3.

[66].              Ibid.

[67].              Ibid.

[68].              Freeview is the free digital television service in Australia which presents and promotes Australia’s free-to-air channels and content to all Australians. Freeview encourages Australians to watch free-to-air content across various platforms by promoting its benefits that include more than 25 channels and catch-up services for free. SBS re-joined Freeview in March 2016 and D Davidson, ‘SBS quits Freeview in “tantrum”’, The Australian, 14 May 2015, p. 9.

[69].              SBS pays Foxtel a fee to retransmit SBS content. S Aujard and Q Dempster, Disconnect Foxtel, don’t sack SBS staff, media release, Save Our SBS, 26 June 2015.

[70].              M Robin, ‘SBS2's The Feed slams Pomeranz, Dempster as staffers brace for job cuts’, Crikey, 26 June 2015.

[71].              D Knox, ‘Cut the cable: lobby group tells SBS to withdraw from Foxtel’, TV Tonight, 27 June 2015. Note: the TV Tonight website, claimed that carriage fees for SBS were less than half those suggested by Save Our SBS, but it provides no evidence to substantiate its claim.

[72].              Australian Government, Mid-year economic and fiscal outlook 2015–16, Appendix A: policy decisions taken since the 2015–16 Budget: expense measures, pp. 128 and 153.

[73].              M Robin, ‘SBS gets $4.1m, but it's a reprieve, not a restoration’, Crikey, 16 December 2015.

[74].              Australian Government, Portfolio budget statements 2016–17: budget related paper no. 1.3: Communications and Arts Portfolio, p. 323 and Australian Government, Budget measures: budget paper no. 2: 2017–18, p. 286.

[75].              Federation of Ethnic Communities’ Councils of Australia (FECCA), Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, submission no. 3, 13 April 2015.

[76].              Ibid.

[77].              M Robin, ‘A fourth network by stealth? Media buyers shrug off SBS’ threat to commercials’, Crikey, 20 November 2014.

[78].              Ibid.

[79].              Ibid.

[80].              Ibid.

[81].              Ibid.

[82].              Ibid.

[83].              Communications Law Centre, Submission to Senate Environment and Communications Committee, Inquiry into Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, submission no. 27, 19 May 2015.

[84].              Ibid.

[85].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility) Bill 2017, p. 3.

[86].              Explanatory Memorandum, Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, p. 5.

[87].              Free TV Australia, SBS Legislation creates 4th commercial TV licence by stealth, op. cit.

[88].              The Statement of Compatibility with Human Rights can be found at page 15 of the 2017 Explanatory Memorandum to the Bill.

[89].              Parliamentary Joint Committee on Human Rights, Report, 3, 2017, The Senate, Canberra, 28 March 2017, p. 17.

[90].              SBS, Submission to Senate Environment and Communications Committee, op. cit. p. 19.

[91].              W Rowland, 'Public broadcasting in the United States', invited submission to Encyclopedia [sic] of Communication and Information, Macmillan, New York, 2002. Not available online.

[92].              Ibid.

[93].              T Dunleavy, Public television in a small country: the New Zealand "experiment" twenty years on, Flow, University of Texas, 15 May 2009.

[94].              Ibid.

[95].              TVNZ Charter.

[96].              P Thompson, ‘Govt shows double standards over broadcasting’, The Dominion Post, 27 March 2011.

[97].              Television New Zealand Amendment Act 2011.

[98].              T Dunleavy, Public television in a small country: the New Zealand "experiment" twenty years on, op. cit.

[99].              P Norris, ‘A race to the bottom’, New Zealand Listener, 222(3644), 13 March 2010 and T Dunleavy, ‘Don’t go there: the ongoing undermining of PSB in New Zealand’, Open Democracy website, 24 February 2014.

[100].              See, for example, a diagram which provides a comparative analysis in F Papandrea, State of the newspaper industry in Australia, University of Canberra News and Media Research Centre, Canberra, 2013, p. 9.

[101].              In 2010, the Labor Government announced a rebate for television licence fees of 33 per cent for 2010 and 50 per cent for 2011. The 50 per cent reduction was extended to the end of 2013 by regulation and confirmed in legislation at that time. The reduction in fees from nine per cent of gross annual earnings to 4.5 per cent was justified as a move to protect local content, and it was argued it would help counter the significant financial pressures faced by commercial television stations as a result of emerging and convergent technology and an increasingly challenging operating environment. In 2016 the current government further reduced television licence fees by 25 per cent (the reduction also applied to radio licence fees). See R Jolly, Broadcasting Legislation Amendment (Television and Radio Licence Fees) Bill 2016, Bills digest, 15, 2016–17, Parliamentary Library, Canberra, 29 September 2016.

[102].              K Quinn, ‘TV producers, actors slam licence fee cuts for commercial free-to-air networks’, The Sydney Morning Herald, (online edition), 3 December 2012.

[103].              For more detail on the anti-siphoning scheme see R Jolly, Sport on television: to siphon or not to siphon?, Research paper, 14, 2009–10, Parliamentary Library, Canberra, 11 February 2010.

[104].              B Keane and G Dyer ‘Television: the land where the age of entitlement never ends’, Crikey, 12 February 2014.

[105].              BBC Editorial Guidelines, ‘BBC licence fee funded television services and product placement: guidance in full’, BBC website, April 2011.

[106].              Ibid.

[107].              ABC, ‘Editorial policies: advertising and sponsorship restrictions’, 1 August 2014.

[108].              Ibid.

[109].              Special Broadcasting Services Act 1991, section 6.