Government taps media heavyweights as regional news talks heat up

Former Fairfax Media chief executive Greg Hywood and ex-Foxtel boss Peter Tonagh are among a collection of top media executives the federal government has approached as it searches for ways to support struggling regional media companies.

As Communications Minister Paul Fletcher prepares for key talks with regional media stakeholders in Wagga Wagga this week industry sources cautioned that supporting the sector remains complex and there is "no silver bullet" that the government could use to ensure rural newsrooms survive.   "No one has solved this problem, not in the UK or the US" one source said.

Former Domain CEO Antony Catalano took over the Australian Community Media portfolio of newspapers and publishing assets in July.Credit: Jesse Marlow

Department of Communications secretary Mike Mrdak met with senior media industry figures, including Mr Hywood and Mr Tonagh and News Corp group executive of corporate affairs, policy and government relations Campbell Reid, earlier this year.

The meetings were held when Mitch Fifield was Communications Minister, however Mr Fletcher and the department have continued to build on plans to assist regional broadcasters including commissioning a report by former PwC partner Megan Brownlow.

Sources familiar with the discussions said the ABC's presence in the regions and the potential for federal subsidies or more advertising from government departments to support regional publications were among the issues floated in the talks.

Regional media has moved back into focus over the past year following a spate of corporate dealmaking as well as cuts to newsrooms outside of capital cities.

Nine Entertainment Co, which publishes this newspaper, sold its regional publications to former Domain executive Antony Catalano in July for $125 million.

Seven West Media chief executive James Warburton last month struck a deal to acquire the network's regional affiliate Prime Media. Mr Catalano, who has also lobbied aggressively for changes to regional media regulation, last week emerged with a 10 per cent stake in Prime in a potential attempt to thwart the deal.

Mr Fletcher is expected to discuss additional support for the regions at an event in Wagga Wagga this week.

A spokesman for Mr Fletcher said in a statement there were regular discussions with stakeholders and industry, including the upcoming regional media symposium "to discuss challenges and opportunities for the sector".

"Brownlow's report ... provides a perspective on Australia's regional media and will be one of many varied perspectives in the mix of considerations and factors the Government will weigh up in a response to the [competition watchdog's] Digital Platforms Inquiry by the end of the year," the spokesman said.

The inquiry looked at how tech titans Facebook and Google had affected traditional media companies and advertising revenue. Regional publishers are grappling to product costly news bulletins amid declining audiences as people increasingly head online, and face growing competition for advertising budgets. These issues have since been exacerbated by the drought, which has hit rural business confidence.

A media source familiar with the ongoing dicsussions said the main concern was that no country had yet figured out how to support regional media companies in the face of declining audiences and advertising revenue.

While metropolitan newspapers have scale that has allowed them to radically change their business models, regional publishers lack the audiences needed to pivot into online or subscription-focused services.

"The government has to be there because it's a political nightmare, a lot of these newspapers are mouthpieces in the regions," the source said.

Direct subsidies are not favoured by regional media executives who fear there could be a quid pro quo leaving publishers vulnerable to government manipulation. Media industry figures also believe the government is unlikely to consider pouring taxpayer funds directly into regional media companies as a viable option.

"The challenge for government is that once you start propping up regional media, you'll [have to] keep doing it," they said.