Australia’s Big Media Set to Get Bigger, With Help From Lawmakers

Australia’s Big Media Set to Get Bigger, With Help From Lawmakers


The shifting media landscape has led to questions around the world about power and influence. In the United States, media companies have sought an exemption to antitrust law to strike bargains with Google and Facebook. In Britain, regulators are exploring whether 21st Century Fox, which is led by Mr. Murdoch, would get too much media power there if it took full ownership of Sky, the satellite broadcaster.

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Rupert Murdoch this month at the U.S. Open in New York. According to media experts, the changes passed in the Australian Senate would lead to a less diverse, more consolidated market, with Mr. Murdoch’s News Corporation among those likely to benefit the most.

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Jewel Samad/Agence France-Presse — Getty Images

The media concentration issue is a familiar one for Australians. Thanks in part to a relatively small population of 24 million and the country’s geographic isolation, many of its most important industries are dominated by a handful of large companies. Australia has four big banks, two major airlines, two main internet service providers and a few national grocery chains.

Australia’s current media rules draw some limits. They forbid an owner from controlling a television station, radio broadcaster and newspaper in a single market. They also prevent a television network from broadcasting to more than three-quarters of the country’s population.

The rules date to the 1980s, when they were pushed by Paul Keating, then Australia’s treasurer and later the prime minister, who famously said that a media owner could be the prince of print or queen of the screen, but not both.

Today, Australia’s princes and queens enjoy strong holds on their respective platforms.

Properties of News Corporation, Mr. Murdoch’s company, account for nearly two-thirds of newspaper circulation here and include major names like The Daily Telegraph and The Australian. Fairfax Media, an Australian company that owns The Sydney Morning Herald, The Age and The Australian Financial Review, accounts for nearly a quarter.

In broadcast, Australia’s main television network owners include Nine Network, Ten Network Holdings and Seven West Media, as well as two publicly funded television networks, the Australian Broadcasting Corporation and SBS.

But the digital era has eaten away at their strengths.

News Corp. said revenue at its Australian publishing operations fell 2 percent in the 12 months ended in June compared with a year ago. Fairfax is cutting newsroom jobs, provoking dissension there, after its own fall in newspaper revenue. Among broadcasters, Ten and Seven West Media have reported losses of hundreds of millions of dollars in recent months.

Global media companies are also presenting tougher competition. In a move that surprised many Australians, the CBS Corporation, the American broadcaster, reached an agreement this month to buy Ten. It beat out a group that included Lachlan Murdoch, co-chairman of News Corp. and Rupert Murdoch’s son.

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Mitch Fifield, Australia’s communications minister

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Lukas Coch/European Pressphoto Agency

Australia’s media companies argue that easing ownership limits will give them greater heft to compete with bigger, better-funded internet companies from abroad. The rule against broadcasters’ reaching more than three-quarters of the population, for example, makes little sense in an era of streaming videos and online movies on demand, some argue.

“These reforms are important,” said Michael Miller, executive chairman of News Corp.’s Asian and Australian operations, in a statement. “This finally addresses the restrictions that have held back the competitiveness of media companies in Australia for far too long.”

That argument has won support from Malcolm Turnbull, Australia’s prime minister, and his Liberal party. After the legislation passed the Senate, Communications Minister Mitch Fifield said in a statement, “Australian media companies will now be better placed to compete with the big online media companies from overseas.”

A number of experts said the legislation would do little to help media companies compete with the likes of Google. Instead, they said, it would help homegrown companies winnow out other local competitors.

“It will lead to a greater concentration of power,” said Denis Muller, a senior research fellow at the University of Melbourne’s Center for Advancing Journalism.

Opponents of the bill, many of them in the opposition Labor Party, consider it a favor to media owners like Mr. Murdoch, widely considered sympathetic to the conservative Liberal party.

News Corp. newspapers offered “unrelenting support and uncritical support” for the Liberal party in last year’s elections, Mr. Muller said.

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Staff at the newspaper The Age protesting Fairfax Media cuts in Melbourne in May.

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Joe Castro/European Pressphoto Agency

The critics also point to the government’s recent decision to grant 30 million Australian dollars (about $23.6 million) to Fox Sports, a cable broadcaster owned by News Corp. Government officials — who said the grant was tied to the effort to overhaul media rules — said the money was intended to support women’s sports, like Australia’s women’s national soccer team, which broadcasts its matches on Fox Sports.

Asked about helping News Corp, Mr. Turnbull’s communications officials said in a statement that the pending legislation is “unabashedly pro-Australian voices and pro-Australian jobs.” It added, “The Labor Party was and remains completely indifferent to a strong Australian media.”

The Liberal party struck a number of deals to get the legislation passed. One senator, Nick Xenophon, successfully demanded additional initiatives, including a package of 60 million Australian dollars, or $47.2 million, to help small and regional publishers, allowing them, he said, to “have a fighting chance to flourish.”

The package has been criticized by Labor politicians as merely providing smaller outlets with equipment and doing nothing to sustain jobs.

At Mr. Xenophon’s urging under an additional initiative, the government has pledged to conduct an inquiry into the impact of Facebook and Google on advertising revenue.

The Liberal party also struck a deal with the One Nation Party, a right-leaning party led by Pauline Hanson, who has long criticized coverage by Australia’s public broadcasters. Under that agreement, government officials will put the content and practices of the Australian Broadcasting Corporation under greater scrutiny.

“We’re looking after the public’s interest,” Ms. Hanson said, “in ensuring that they get a fair deal.”



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