Digital cash grab ‘not so bad for some’

The loss of revenue by traditional media because of tech giants may not be as bad as some suggest, Paul Fletcher says.

Communications Minister Paul Fletcher. Picture: AAP

The loss of revenue by traditional media because of tech giants may not be as bad as some suggest and it will be considered as part of a ­response to calls for regulatory ­reform, Communications Minister Paul Fletcher says.

Mr Fletcher cited advertising spending data released on Thursday to suggest the outlook for traditional media was “more ­nuanced”.

“(The data) tells some quite interesting stories, because there’s a conventional wisdom about the media and communications sector, which is that the new digital platforms are dominating; the traditional Australian businesses in the media sector dying,” Mr Fletcher told agency and media executives. “Of course, negative stories always get a good run … and some of those perspectives are very much what’s reflected in the recent Australian Competition & Consumer Commission’s digital platforms review.

“What I think is interesting from the … data is that the story is a bit more nuanced than that.”

The comments followed the release of a report on advertising spending, which revealed a ­decline for television, magazines and news media, but growth for radio, out-of-home and digital over the past decade.

Television’s share of advertising spending fell from 49 per cent of the overall market in 2009 to 41 per cent, while news media fell from 19 per cent to 5 per cent. Digital was up from 9 per cent to 29 per cent.

Mr Fletcher made reference to the ACCC report, which said Google takes 96 per cent of search revenue in Australia and that Facebook and Instagram collectively have 51 per cent of the online display advertising market.

But he said: “Radio is up over 10 years, outdoor is up and increasingly outdoor is digital and TV is holding up better than at least the headline story would suggest.”

New data also forecasts advertising spending will grow in October. “The data … is also of interest to those of us in government as we think about policy decisions to make in relation to the future of … the digital platforms and how they’re competing with more traditional businesses and whether there are changes we ought to make,” Mr Fletcher said.

The government is considering policy and regulatory changes in response to the final ACCC report, which was commissioned amid concerns that Facebook and Google had undermined the economics of commercial media.

The government will make a decision on its regulatory and legislative response to the report before the end of the year, but Google and Facebook have ­already raised concerns.