Wednesday, February 17, 2010

The assault on Free to Air television

The Murdoch press has come out with all guns blazing on the issue of licence fee rebates for the FTA networks.

ichael Stutchbury writing in the Oz labels it "corrupt" because it is a supposedly "scret" deal. The sin being that;

Neither the Prime Minister nor Conroy have revealed what the commercial broadcasters agreed to provide in return for paying less to use their publicly owned spectrum.

It really is a piece of nonsense framed like that. The broadcasters clearly made the point that they needed either a reduction in licence fees or a reduction in ocal content quotas. The Government chose the former. The fact there has been no writte commitment about local content related to the rebate could well be due to it being prohibited under the US-Australia Free Trade Agreement (the other FTA).

Meanwhile Terry McCrann has written a diatribe that shows he is more a tool of Murdoch propaganda than serious business journalists. He tries to claim that the only reason Rupert Murdoch doesn't own a Free to Air network is because he wasn't a media mogul whe the licences were handed out in the 1950s.

He forgets to mention that the only asset still held by its original owners is Nine Sydney and Melbourne, both of which were sold then bought back. He doesn't mention that Rupert used to own TV stations but had to dispose of them under the media cross ownership laws when he acquired HWT. He doesn't mention that News and Telstra each bought 15% staks in Seven when it was re-floated after receivership.

That party ended when Seven decided to join Optus and Nine in Pay TV anyway.

And Kerry Stokes is an even more recent media mogul than Rupert. He bought his entire stake in Seven on the open market. CanWest has been a ready seller over at TEN for some time. Rupert can't buy it for a whole host of reasons, but mostly because he doesn't really want to.

Meanwhile at Crikey, Bernard Keane repeats the line that the free to air networks were "given" 7 MHz of spectrum for the purposes of digital conversion. He qualifies this by saying they didn't have to "bid for it". The vast bulk of users of spectrum pay for it by administratively determined licence fees, not by auction.

The FTA networks pay for their spectrum in licence fees that are a progressive scale on revenue up to a rate of 9%. It might have been reasonable to think of the additional channels as additional licences - but they weren't. That actually means the networks pay more because they are paying 9% of the small revenues they get from the multi-channels rather than the lower rate the revenues would qualify for o their own. Issuing an additional licence would have raised less money not more.

The main users who have acquired spectrum through auctions ("bidding for it") are the mobile networks. Not all their spectrum was acquired that way - they pay a flat licence fee for the 900 MHz spectrum originally used for GSM. If you project mobile industry revenues forward at the same growth rate as today a licence fee of less than 3% of revenue would have raised the same amount as the fees raised by auction.

So let's just get the facts straight. The FTAs are paying for their (temporary) digital allocation and they are paying more for it than those people who did buy spectrum at auction.

Meanwhile Telstra and News pay nothing for their use of the airspace through which the Cable TV signal is distributed despite the attempts of some local councils to charge rates for it.

Sunday, February 7, 2010

Intelligence Squared

There is a suggestion that Intelligence Squared can't find speakers for the filter for their forthcoming debate on the incorrectly named internet filter. (Actually its against - cause the topic is Governments should not censor the internet.

Maybe they should invite Verity.

Regulation and the planned economy

A very intemperate post from me on a very stupid article in New Zealand on competition and regulation.

This is a guy whose belief in "freedom" runs to his freedom to be exploited by monopolists.

I wrote in part;

When New Zealand was the global darling of economic turn around it wasn't from abandoning the law or regulation as such, but from introducing competition. New Zealand is allowing itself to "go soft" by listening to the bleating of its large firms.

There is no part of improving one's global competitiveness by reducing competition at home that can ever be justified. New Zealand might just be still getting away with it in dairy.

But riddle me this, if just one or two large firms, or even a cartel of firms provides global competitiveness, then a centrally planned economy is the way to go. With no local market competition you aren't getting the price system to do anything.

Letting domestic firms get fat dumb and happy on monopoly rents is no incentive to go compete.

Anonymous comments

Verity is always thrilled to see her name in print, even if it is a very short comment on Crikey's website.

The comment was on the discussion about South Australian law that attempted to outlaw anonymous blog comments as part of political commentary. The new age internet types were horrified. However, there are two things we should look at. The first is how existing law works, and the second is about how anonymous comment can play out.

The first thing to note is that it is standard law across Australia that electoral comment has to be authorised by someone. We are used to the authorisation line on electronic and printed ads. We might forget though the additional line that appears to cover editorial content in newspapers as required by s328 of the Commonwealth Electoral Act. The Act also covers ads on the internet and misleading or deceptive publications.

Newspapers will normally include a line as to who is taken to be publisher of the paper for these purposes. That means that if the newspaper chooses to publish material that falls foul of the law the publisher is at fault. I find it fascinating that people on the web don't realise that the same rules apply, that ultimately the person who owns a domain name and thus authorises all the content that is available on their site is the "publisher".

How the anonymous content thing can play out is also interesting, mostly because it is open to manipulation. I think I started this blog soon after reading Ender's Game in which part of the plot is a brother and sister who created two fictional characters who get involved in debate on (I think) the interweb. The point is that they create an artificial conflict between themselves which they then resolve and bring both lots of supporters along with them.

The risk factor is that the speed of network formation and expansion using online media rather than the printed word or radio is that the "swarm" can develop before there is any nterrogation of its source.

Ultimately though the correct legislative solution is not a ban on anonymous content, just a recognition that the publisher (domain owner or as otherwise delegated) remains responsibl for the content.