Media reform bill tabled in parliament

The senator’s support may be critical to the Coalition’s media reform package, tabled today.

Malcolm Turnbull. Picture: AAP.

Powerful independent senator Nick Xenophon has called for TV licence fees to be slashed after the Turnbull government tabled a landmark media reform bill.

Senator Xenophon, whose support could be crucial to the bill’s success, said Australia’s free-to-air licence fees were too high and any cut should be offset by a turnover tax on global digital giants such as Google, Facebook and Netflix.

The free-to-air networks — including Seven, Nine and Ten — pay higher licence fees than their global peers and, like all traditional media companies, have seen their advertising revenue come under pressure from digital competitors.

“Right now there is not a level playing field with Australian free-to-air broadcasters still copping the highest broadcast licence fees in the world while the likes of Google, Facebook and Netflix have a huge competitive advantage and are eating into the revenue of Australian TV broadcasters,” Mr Xenophon said.

“Media reforms in the changing media landscape are obviously important, but why should Australian-based broadcasters with a strong commitment to local content and production be at such a disadvantage compared to these multinationals.”

The current licence fee, equal to 3.375 per cent of sales, reaps more than $100 million a year in revenue for the government and is far higher than the UK fee of 0.21 per cent.

Mr Xenophon’s comments come after he had lobbied for licence fee cuts to be implemented to offset his proposed restrictions on gambling advertising on free-to-air networks.

It comes as the momentum for media reform grows, with the Coalition today introducing a decisive package that seeks to axe outdated pre-internet laws, in a move that would allow more deals in the sector.

The Turnbull government tabled the bill in the lower house today after it was approved by the party room on Monday, as revealed by The Australian.

“Australians are changing the way they access media and our laws must adapt to these trends,” the government said in statement.

“In the digital era, our current regulations unfairly restrict Australian-based broadcast or publishing companies from optimising the scale and scope of their operations and from accessing resources, capital and management expertise available to other media operators.”

The Turnbull government has proposed scrapping the reach rule, which prevents mergers between metropolitan and regional free-to-air broadcasters, and the two-out-of-three cross media ownership law.

But the bill is unlikely to have a smooth path through parliament with Labor not expected to support the abolition of the two-out-of-three rule, which stops anyone from owning a newspaper, free-to-air TV licence and radio station in the same metro market.

Labor will support the reach rule’s abolition in isolation but Communications Minister Mitch Fifield ruled out splitting the package as recently as this week.

It is understood that former communications minister Stephen Conroy is strongly opposed to axing the two-out-of-three rule, although the Labor Party is yet to publicly commit to a view on the issue.

Senator Conroy, the deputy opposition leader in the Senate, is a factional powerbroker and, as the former minister, carries significant sway in the area of communications.

The bill is largely unchanged from one that was introduced prior to the July 2 double dissolution election, although there has been a tweak to a key clause that seeks to protect regional TV news in the event of a merger.

Key to the National Party’s support of the bill was a clause that required regional networks to boost production of local news in the event of a change of ownership. However, under the previous bill the clause was only triggered if a metropolitan network took over a regional network.

It is understood the legislation has been amended to apply to situations where a regional network would absorb a metro network.