Who's Afraid Of The Public Interest

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The government’s plan to impose a public interest test on media ownership is raising the hackles … of media owners.

No surprises there. Few industries display the righteous indignation shown by media proprietors at the barest hint of government regulation. When it comes to media regulation, the media likes to believe it should be above the law. All sorts of boilerplate phrases about the "public’s right to know" and "speaking truth to power" are routinely thrown about.

This week, the owners of Australia’s largest media companies wrote to the government to express their concern about media regulation. The letter, which surfaced yesterday, was penned by the CEOs of the nation’s big media firms, including Seven West Media’s Don Voelte, Nine’s David Gyngell, AAP’s Bruce Davidson and News Limited’s Kim Williams.

Written in that uniquely contemptuous tone with which big media bosses like to adopt with the elected representatives of the Australian people, the letter expresses lordly concern with "the so called proposed ‘public interest’ test on media ownership; the recommendations on management of press complaints; and the tone and framing of the debate on these matters." Elsewhere, it complains (in italics, no less) about a "massive increase in regulation".

You might be wondering what the fuss is all about. Has the government unveiled a vast new suite of media laws? Will each news report need to be ticked off by a government agency? Will there be a commissar in every newsroom?

Err, no. The government has announced nothing. The rumours of a public interest test for media ownership remain exactly that. As far as we know, the sum total of the government’s formal response to the Finkelstein and Convergence Reviews is a number of unsubstantiated reports in the Fairfax and News Limited newspapers about various plans that have yet to be taken to cabinet.

The Greens have introduced a bill on the issue. Their Broadcasting Services Amendment (Public Interest Test) Bill 2012 would create a new public interest test applying to what they’re calling "changes in control of nationally significant media enterprises". These are defined as having an Australian audience of at least 500,000 a month, and revenue of $50 million a year from their Australian media operations. The Bill has been introduced and is in second reading. So far the government has not indicated whether it will support it. Most likely, it will be voted down.

I called Communication Minister Stephen Conroy’s office to check whether there was any dastardly plan to regulate the media. "There is no public interest test", a spokesman told New Matilda. "The government is still considering the Finkelstein and Convergence Reviews."

Which makes the report in The Australian today all the more curious. "The man who co-wrote the controversial test, Stuart Simson, labelled the government’s plan a ‘dog’s breakfast’ of extra regulation that would damage the sector unless other curbs were removed," David Crowe’s article declared. Crowe had secured an interview with one of the authors of a Productivity Commission report from 12 years ago, which did indeed recommend a public interest test for media mergers and acquisitions be added to the Trade Practices Act, and administered by the ACCC. But, as the staffer from Conroy’s office pointed out, there is no extra regulation currently on the table. "You can’t say it’s a dog’s breakfast, because the government is still considering its response," he told New Matilda.

Of course, that hasn’t stopped much of the media from working itself up into a lather about the mere possibility of such a test. "It can’t work!" has been the gist of much of the commentary, from perspectives as far afield as the now-retired Simson to media academic Timothy Dwyer.

"We recommended [the public interest test]in the context of deregulation, not in the context of re-regulation," Simson told Crowe in today’s Australian article. "In theory it has many good attributes but in practice, it has been highly susceptible to political interference," Dwyer told Crikey’s Matthew Knott yesterday.

So what is a public interest test, and why is it such a tricky thing to administer? The answer, of course, is politics. The media produces symbols, and symbols influence voters. Media outlets can therefore wield considerable power in a democracy, as every politician tacitly acknowledges. Because of this, regulating media is by definition a political act, because it will inevitably impinge upon the political interests and fortunes of the government of the day. Thus the neat libertarian slogan we hear from the Institute for Public Affairs, that a public interest test is really a "political interest test".

But the answer to this charge is: so what? All government policy is political, almost by definition. We live in a democracy, and regulating the media is often quite popular — as News Corporation is discovering in the United Kingdom. Moreover, the absence of regulation is itself a highly political stance, particularly in the contemporary Australian mediascape in which a handful of powerful billionaires control the vast majority of what we read, see, hear and click on.

There’s no doubt that a public interest can be highly controversial. Example A is in Britain, where Rupert Murdoch’s attempts to take full control of the Sky satellite television business formed the backdrop to the behind-the-scenes power manoeuvres explored by the Leveson Inquiry. As Leveson testimony revealed, David Cameron’s government was the target of intense lobbying efforts by top News Corporation executives in the run-up to the decision of whether to allow the takeover of BSkyB by News. James and Rupert Murdoch, as well as top News Corpoation newspaper editors, all raised the merger with the responsible minster, Jeremy Hunt, and with Cameron himself.

Of course, just because Britain’s public interest test doesn’t work — it has been invoked only twice — doesn’t mean that all public interest tests are doomed to fail, or that the idea itself is a bad one. In fact, it should be possible to construct a public interest test, perhaps administered by an arms-length government agency, that does what it says: imposes careful consideration of the social, cultural and competitive consequences of media concentration in the interests of Australian citizens.

To see why, let’s turn the problem around and consider it from a different direction. Would anyone seriously argue that greater diversity of media ownership would be against the public interest in Australia right now? I would argue, and I imagine many would join me, that Australia’s excessive concentration of media ownership in the hands of a few giants is, in and of itself, inimical to the interests of the public.

As Greens Senator Scott Ludlam pointed out last week in a thoughtful op-ed, "A tiny handful of media groups own and control most media outlets in Australia, and while we may be getting our news and opinion on a much wider range of devices and platforms, existing interests are moving swiftly to entrench their established power into the converged world." Ludlum argues that, for the big players, "some vestigial reminder of the public interest they are there to serve is now an urgent necessity".

The opposition to the public interest test from some parts of the commentariat resembles the common argument that governments shouldn’t intervene in the free market to "pick winners". The problem with the "don’t pick winners" argument is that it assumes that governments can somehow stand back from the self-regulating free market in the first place. This is a patently absurd claim, and nowhere more so than in media, where government regulation has shaped the entire industry for a century.

It is the government that regulates the radio spectrum on which television, radio and 3G data travels, which is why the Convergence Review devotes a whole chapter to the topic. It is the government that enacts and enforces the copyright laws that media companies rely on to protect their intellectual property. And it is the government that doles out hundreds of millions of dollars each year to free-to-air broadcasters in the form of license fee rebates and digital switch-over funding, and to newspapers in the form of government job advertisements.

Perhaps most ironically, given that several of the signatories to this week’s letter are bosses of free-to-air networks, it is the government which maintains the remarkably anti-competitive broadcasting environment in which it is effectively illegal to start a fourth free-to-air television network in this country.

In other words, media regulation in this country is already with us. The debate is not just about "less is more". Most of the current regulations serve the interests of the big media barons, not the public. In this context, public interest tests are a step in the right direction. They represent a regulatory reform.

Ben Eltham

Ben Eltham is New Matilda's National Affairs Correspondent.

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