Secretary's speech to KANZ Broadband Summit 2012
This page provides the text of a speech on convergence the Secretary of the Department of Broadband, Communications and the Digital Economy, Peter Harris, gave at the Korea-Australia-New Zealand (KANZ) Broadband Summit 2012 on 15 May 2012.
Speech by Peter Harris, Secretary of the Department of Broadband, Communications and the Digital Economy
Korea-Australia-New Zealand (KANZ) Broadband Summit 2012
15 May 2012
In 1992, the Australian Parliament passed the Broadcasting Services Act, revolutionising Australia’s approach to media legislation.
Communications technology has come a long way since 1992.
User-generated content, IPTV and digital radio are now standard parts of our media landscape.
Other innovations, like smart TVs and social viewing, are rapidly growing in popularity.
This is changing the fundamental nature of the communications industry and it is incumbent on governments to keep regulation up-to-date so that there is scope for innovation and protection for community interests.
It’s for this reason that the Australian Government initiated the Convergence Review, which I spoke of in detail at KANZ in Tasmania last year.
At the time, I observed that, while convergence as a phenomenon had been around for the last 15 years, the policy frameworks had been able to manage without a major overhaul, until now.
With the success of device manufacturers—such as Samsung and others—and with the clear shift in consumer preferences that now—not during the telecoms deregulation period of the 90s, not in the dot com revolution of 2000, but now—the time had come to accept that convergence of telecoms and broadcasting is upon us and as such there is a need to re-examine in Australia the regulatory structures that underpin the businesses that deliver services over communications networks.
Well, after undertaking extensive consultations, publishing eight consultation papers including an interim report, and working through some 340 written submissions and more than 28 000 comments, the Independent Review Committee has handed in its report to government.
Before I turn to some of the more substantive issues, I will make a couple of high-level observations.
- While I was confident a year ago that a new policy framework was essential, the pace of change in the market even in the past year, regardless of any report, demonstrates the need to initiate far-sighted reform is now not only essential but pressing.
- Based on submissions to the review, the time when convergence was on the radar but not being factored into short-to-medium term business plans has long passed.
- In implementing a new policy framework, a key challenge will be to provide an opportunity for firms to stress test the proposed reform measures in a constructive way.
I am going to venture here a few ideas towards that end, as I outline what the review proposes.
A quick synopsis of the findings is all that time will permit. The report is on our website and some of its proposals will probably travel quite well. I will be in Canada next month and I understand there is already interest there in these ideas.
The review found that Australians continue to expect three key things in the changing media landscape:
- a diverse news media with content delivered from a number of different owned sources
- continuing access to Australian local content, and
- media content standards across all platforms, particularly those that reflect children’s interests.
It also found, unsurprisingly, that the government will need to rebalance the mix of policy tools it employs to achieve these ends. The heavily-regulated broadcast media want the removal of regulation, while the online news media want to remain outside the current standards and content regulatory arrangements. And, with all governments now in search of innovation, it seems that both the old and the new media will prove more right than wrong in their objectives.
Less regulation is not, however, no regulation. Less regulation may well be the use of new methods of achieving the same overall standard.
In a global and converged marketplace, relying heavily on black-letter law to achieve the production of public interest outcomes is probably not sustainable.
Regulation needs to be used only where it can be expected to remain respected by the regulated. Not loved, perhaps, but nevertheless respected. The failure of laws that are passed with no expectation of delivering an outcome is the greatest failure in public policy.
And in the circumstances of the new media, the use of agreements or other concepts borrowed from the world of international trade—where countries generally recognise the futility of black letter law as a means of regulating global behaviour—or from public-private partnerships where the alliance is driven by a sharing of risk rather than an allocation of it, may prove more viable.
A further organising principle is that obligations on market participants should be confined to those enterprises that have substantial influence—the review refers to these firms as content service enterprises.
Such enterprises would all face the same regulatory obligations—thus a level playing field—even if they may have different means of delivering those obligations. Thus free-to-air broadcasters, cable TV operators, over-the-top services and new media internet services would all need to meet a common set of obligations, but might differ in how they do it.
Or looked at another way, how their obligations might be less the subject of law and more the subject of negotiation.
The Convergence Review proposes these content service enterpises be identified by criteria such as:
- control of professional content they deliver
- a threshold of a large number of Australian users of that professional content, and
- a revenue threshold.
The thresholds for revenue and users would be set at a high level, so that only the most substantial and influential entities are within the category of a content service enterprise.
In addition to providing useful regulatory concepts on which to base a more confined regulatory scheme, the review has emphasised the importance of competitive markets.
Specifically, the review points to breaking the link between the right to spectrum and a content licence. Content service enterprises do not need to have spectrum: you can with other platforms today reach as many households without it as with it. Perhaps not as efficiently, but perhaps the completion of Australia’s National Broadband Network by the end of the decade, with its continent-wide fibre-to-the-home network, will change the commercial dynamics.
This will not only free up the scope for more efficient and alternative uses of spectrum, but in a market structure sense separates the broadcasting industry, thereby better allowing firms to choose how to compete as well as with what content they will compete.
Policies for the allocation and management of broadcast spectrum should be more closely aligned to broader spectrum policies, including limited tenure and market-based fees. The broadcast licence fee—currently a turnover tax with no value as a tool to allow allocation to occur efficiently, and minimal linkage to the value of broadcast spectrum—could then be abolished and be replaced with a spectrum fee similar to the process that applied now in telecommunications. Thus convergence is supported.
The Convergence Review has provided the opportunity for serious shifts in policy to be debated in Australia. I look forward to hopefully speaking to you at the next KANZ to discuss the progress that has been made in addressing, in an innovative and sustainable way, the challenge and opportunities that convergence presents.
3 http://techliberation.com/2008/12/13/technology-2008-vs-1992/ (originally published in Forbes magazine)