ABC & SBS cleared over competing with networks

The ABC and SBS have been cleared in the industry-profile Competitive Neutrality review.

The review, agreed to as part of a deal with Pauline Hanson’s party to pass media ownership reforms, found the public broadcasters do not enjoy an unfair competitive advantage over their commercial rivals.

Free TV, representing Seven, Nine and 10, has complained that the broadcasters were competing with them in news and content. That includes objecting to titles as being “off charter.” But the review ruled they competed fairly in the marketplace and abided by their charters.

ABC and SBS were not overstepping their charters by publishing free online news, the review found. In fact, the charters compelled the public broadcasters to maximise their reach and become “significant” content providers across all platforms.

But it did find the charters were so broad it was “hard to conceive of an activity or program that could not arguably be fitted under the charters as they are currently written”. It also concluded they needed to be more transparent in their business activities and report on how their operations related to their respective charters.

The Australian Government Competitive Neutrality Complaints Office has only received a single complaint about the ABC or SBS, which was levelled against the ABC in 1999.

The three-person independent panel was made up of former ABC director of television Sandra Levy, former Free TV chief executive Julie Flynn and former Productivity Commission head of office Robert Kerr.

The review also recommended the government consider options for a long-term funding model for the ABC and SBS, rather than agreements that are renegotiated every three years.

Communications Minister Mitch Fifield will take no action in response to the six-month inquiry, saying it was up to the broadcasters to deal with the report’s limited recommendations.

ABC statement:

The ABC welcomes the findings of the competitive neutrality report, which reinforces the importance of a well-funded, independent ABC.

Recognising that the ABC should be able to adapt to new and emerging technology and audience behaviours, the independent expert panel agreed that the ABC is operating in the public interest and in line with its Charter.

The report also found that increasing competitive pressure on domestic media operators is likely to come from international companies, which may lead to further market consolidation such as the Fairfax/Nine Entertainment merger.

The panel accepted the ABC’s submissions that it is operating in a manner consistent with the general principles of competitive neutrality.

The ABC Board and management will consider the recommendations in more detail and respond at a later date.

SBS said in a statement: “As the terms of reference noted, competitive neutrality principles do not imply that government organisations cannot successfully compete with private businesses. SBS is engaging more Australians than ever before as a result of a well-defined strategy, content audiences won’t find anywhere else and efficient operations, all in service of the SBS charter.”

Free TV CEO, Bridget Fair said: “We welcome the conclusion of the Panel that changes should be made to increase the transparency of the business activities of the ABC and SBS.

“While the Panel has identified the issues, they have not adequately set out the governance changes needed to address these shortcomings.

“We have consistently said that we stand with all Australians who want strong, vibrant and distinctive national broadcasters. However, we do not believe the Panel gave sufficient weight to the evidence provided by the commercial sector of competitive neutrality issues associated with recent investment and programming decisions of the ABC and SBS.”

Source: The Age, Australian Financial Review