Dr Rhonda Jolly
Broadcasting and Content Reform
package: broadcasting licence fees
Reduction, or preferably the abolition, of the licence fees
free-to-air broadcasters pay annually has for some time been the subject of
intense lobbying by the industry. Since 2010 there have been a number of decreases
in licence fees, with the last reduction of 25 per cent announced in last
year’s Budget. In this Budget, the
Broadcasting Content and Reform package confirms the Government’s pre‑Budget
announcement that broadcasting licence fees will be
‘abolished’. The Budget
has allowed for a loss of licensing fee revenue of $89.6 million over the next
Broadcasters will, however, still have
to pay for the use of radio spectrum. The Government will set a price on the
use of radiofrequency spectrum that it argues will more accurately reflect its
use. Instead of paying approximately $130.0 million in licensing fees, it is
expected that broadcasters will pay around $40.0 million for the amount of
spectrum they use. The
Government believes the licence fees measure will give commercial broadcasters ‘flexibility
to grow and adapt in the changing media landscape, invest in their businesses
and in Australian content, and better compete with online providers’.
In addition, the Government argues that licence fee relief will make it
possible for the Government to deliver ‘a community dividend’ in the form of
gambling advertising restrictions. It could be argued,
however, as one commentator does, that ‘the budget loser in this
instance is the taxpayer, who owns the spectrum the commercial free-to-air
Commercial Radio Australia has commented that licence fee
cuts will amount to a 94 per cent decrease in commercial radio fees, which will
assist commercial radio to counter ‘increasing pressure from unregulated
international and online competitors’. Free TV Australia has
labelled the reduction in fees ‘crucial’ for Australian jobs and for the
industry’s ‘ability to continue creating great local programming that is
watched by millions of Australians every day’.
The Broadcasting and Content Reform package is part of an
overall strategy for media change announced by the Government prior to the
Budget. The principal measures
in the overall package would remove certain media ownership restrictions—the 75
per cent audience reach rule and the two out of three ownership rule.
The Broadcasting Legislation Amendment (Media Reform) Bill 2016, which contains
changes to the current 75 per cent audience reach rule and the two out of three
ownership measures, passed the House of Representatives in November 2016 and is
currently before the Senate.
In addition, the Broadcasting and Content Reform package
includes changes to anti-siphoning rules to allow pay television operators more
opportunity to bid for major sporting events by removing several major events
from the list and extending the automatic delisting period for events.
Current legislation allows the Minister to remove events from the anti-siphoning
list and to override over-ride the automatic delisting period for a certain
event if he or she is satisfied that a free-to-air broadcaster has not had a
reasonable chance to buy the rights to that event.
However, as section 115 of the Broadcasting Act 1992 specifies certain
hours which constitute the automatic delisting period, this part of the measure
will require legislation to amend the anti-siphoning scheme.
A further measure, confirmed in the Budget’s Broadcasting
and Content Reform package, provides funding of $30.0 million over four
years to subscription television to enable it to increase coverage of sports
that currently receive little, or no broadcast exposure.
This measure will not require legislation to implement.
It appears significant concessions have been made to reach
agreement on the new package. Free‑to‑air broadcasters and
subscription television operators, for example, have for many years taken
uncompromising stances on the anti-siphoning list, with the former opposed to
change. However, the representative bodies for both these media sectors have
praised the proposed reforms. According to the Australian
Subscription Television and Radio Association (ASTRA), such support has
resulted from the involvement of ‘the entire media industry in the development reforms
that address the broad concerns of all participants’.
Despite ASTRA’s declaration, not all participants are likely
to be satisfied. While the licence fee relief will most likely compensate
broadcasters for the loss of revenue from the gambling advertising restrictions,
it does nothing to allay the concerns of sporting organisations. Malcolm Speed
from the Coalition of Major Professional and Participation Sports argues these will
have an impact on the outcome of media rights deals for sporting organisations
and lower the value of media rights, which Speed claims is sport’s greatest
The Minister for Communications, Mitch Fifield, has noted
that the Government’s intention in promoting media reform is to further the
national interest by not allowing ‘the nation’s embattled mainstream media to
flounder in the face of offshore tech giants like Facebook and Google’.
However, some are sceptical of the extent to which traditional media can be
assisted in the new media environment. Glenn Dyer and Bernard Keane, writing
for the online journal Crikey, for example, see the overall package as
‘aid’ for an industry ‘up against an unstoppable wave of change’. Dyer and
Keane argue that licence fee cuts and/or any media mergers or takeovers that
may result from removing legislative restrictions will not halt that change.
In Dyer and Keane’s opinion, Google and Facebook will continue to undermine
other forms of media and ‘care packages’ will not be able to save ‘media
Community broadcasting and
additional funding for the Special Broadcasting Service
This Budget will provide
additional funding of $6.1 million over two years for the community radio
sector. According to a pre-Budget announcement, the
funding will assist the sector with the costs of digital radio broadcasting,
including the extension of permanent services to Hobart, Canberra, Darwin and
the Gold Coast. The funding will also assist community radio broadcasters to
meet transition costs resulting from the Australian Communication and Media Authority’s
reorganisation of the 803-960 MHz radio frequency band.
Community Broadcasting Association of Australia CEO, Jon
Bisset, welcomed the Government’s commitment to the sector, but added that the
increased level of funding will be needed on an ongoing basis, especially to support
regional expansion of community digital radio services.
This measure will not require legislation as the community
broadcasting sector receives funding from the Department of Communications and
the Arts annually. The sector’s funding is then distributed through the
Community Broadcasting Foundation.
As a second iteration of legislation introduced in 2015 to
provide the Special Broadcasting Service (SBS) with flexibility to raise
funding from advertising and product placement has yet to pass the Parliament, the
Government has provided compensatory funding to the broadcaster.
In the 2015 Mid‑Year Economic and Fiscal Outlook (MYEFO) this amounted to
an extra $4.1 million, with a further $6.9 million delivered in the
2016–17 Budget. This Budget continues the
additional funding measure in anticipation of the passage of the advertising
flexibility changes by providing a further $8.8 million to SBS.
SBS has not commented on the additional funding. One journalist
has observed the failure of the SBS legislation is becoming expensive for the
Government and it may be unwilling to continue to compensate the broadcaster if
the SBS advertising flexibility legislation is defeated for a second time in
Australian Government, Budget
measures: budget paper no. 2: 2016–17, p. 8.
M Fifield (Minister for Communications and the Arts), Major
reforms to support Australian broadcasters, media release, 6 May 2017.
Australian Government, Budget
measures: budget paper no. 2: 2017–18, p. 1.
M Fifield, Major reforms, op. cit.
A Carson, ‘Australian media at a crossroads amid threats to diversity
and survival’, The Conversation, 10 May 2017.
Commercial Radio Australia, Commercial
radio welcomes removal of licence fees, media release, 6 May 2017.
Free TV Australia, Broadcasting
reforms positive for Aussie content and local jobs, media release, 6
Fifield, Major reforms, op. cit.
Legislation Amendment (Media Reform) Bill 2016
Fifield, Major reforms, op. cit. For an explanation of
anti-siphoning rules see R Jolly, Sport
on television: to siphon or not to siphon? Parliament of Research Paper
series, No 14 2010, Parliamentary Library, Canberra 2010
The Department of Communications fact sheet, Amending
the anti-siphoning scheme, May 2017, shows the event s the government
intends to remove form the lost.
The latest Ministerial determination for events on the anti-siphoning
list — Broadcasting
Services (Events) Notice (No. 1) 2010
Fifield, Major reforms, op. cit.
Free TV, Broadcasting reforms, op. cit. and Australian
Subscription Television and Radio Association (ASTRA), Media
changes a welcome first step, media release, 6 May 2017.
ASTRA, Media changes, op. cit.
N Tabakoff and J Kelly, ‘Sport
betting ads to be banned “siren to siren”’, The Australian, 20 April
2017, p. 5.
licence fees set for the scrap heap’, Adelaide Advertiser, 10 May
2017, p. 55.
G Dyer and B Keane, ‘Winners
from the media package will need a lot more than handouts’, Crikey,
8 May 2017.
Australian Government, Budget
measures: budget paper no. 2: 2017–18, p. 74.
M Fifield (Minister for Communications and the Arts), New
funding for community radio broadcasters, media release, 4 May 2017.
Community Broadcasting Association of Australia, Government
keeps the community in your radio, media release, 4 May 2017. Note the
community broadcasting sector receives funding from the Department of
Communications and the Arts annually. This is distributed through the Community
Legislation Amendment (SBS Advertising Flexibility) Bill 2017
Australian Government, Mid-year economic and fiscal outlook 2015–16, Appendix
A: policy decisions taken since the 2015–16 Budget: expense measures,
p. 128; Australian Government, Portfolio
budget statements 2016–17: budget related paper no. 1.3: Communications and
Arts Portfolio, p. 323.
budget statements 2017–18: Communications and Arts Portfolio, op. cit.,
C Knowlton, ‘SBS
gets another $9m as ad averaging failure continues to bite’, Crikey,
9 May 2017.
All online articles accessed May 2017.
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