The government of Australia has unveiled sweeping media reforms, which will abolish broadcasting licence fees, relax media ownership laws and scrap rules limiting the reach of TV broadcasts. The reforms will also curb advertising of gambling services, fund the broadcasting of women’s and niche sports and trim the anti-siphoning list for sporting events.
Australia's Department of Communications and the Arts announced the changes, which aim to bring Australia’s ownership laws into the digital era. The Government intends to progress the reforms via an integrated legislative package.
Under the media reform package, the government will abolish annual commercial licence fees paid by the country's free-to-air TV networks, which amounted to A$140 million ($103 million) a year. Replacing the licence fee will be a new A$40 million ($29.4 million) annual charge for spectrum use. The removal of the broadcast licence fee will provide significant financial relief to Australia’s broadcasters, which face increased competition for advertising revenue and audiences from global media giants such as Facebook and Google. However, this relief may be offset by a loss in revenue from the introduction of restrictions on gambling advertisements. This ban will immediately remove gambling advertising before, during and after live sports broadcasts, and applies to all platforms. However, existing exemptions for advertisements during lotteries and racing will remain. The ban addresses concerns that gambling advertisements in sports broadcasts during G-rated viewing periods were normalising gambling for children. If broadcasters can fill these advertising slots then IHS Markit expects significant savings from the abolition of commercial licence fees, which could result in a redirection of these funds into local content production.
Furthermore, the media reform package will scrap the ‘two-out-of-three’ rule that prohibits a company from controlling more than three traditional media platforms – print, radio or TV – in a single market. It will also axe the rule that prevents any TV broadcaster from reaching more than 75% of the population. IHS Markit expects the scrapping of these laws to trigger an increase in merger and acquisition activity, which is likely to result in consolidation across the Australian media industry.
The package will also deliver funding of A$30 million ($22 million) over four years to encourage pay TV operators to increase coverage of women’s sport, niche sports and high participation sports less sustainable to broadcast. As well as increasing broadcast coverage, the funding boost will help increase the profile, participation and sponsorship of these sports.
Elsewhere in the sports sector, the reforms will serve to modernise the Government’s anti-siphoning scheme which was introduced in the early 1990s. The scheme protects the opportunity for free-to-air TV broadcasters to bid unchallenged for rights to broadcast more than 1,300 events including Australian Football League (AFL) and National Rugby League (NRL) matches, English FA Cup, US Golf Masters, the second week of the US Open Tennis, International cricket and Australia versus New Zealand netball matches. The announced reforms will trim the list of sports events under the scheme, providing greater scope for pay TV operators to bid for these major sporting events.
Overall, the reforms will help ensure the ongoing viability of Australian media companies, which according to recent financial results from across the Australian media industry, are under extreme competitive pressure from foreign-owned global media giants. For the viewer, the reforms will help ensure access to high-quality local content reflective of Australian cultural life.