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Much of the history of media regulation in Australia would make an excellent case study of the pursuit of private interests by powerful individuals and of the failure of governments to protect the public interest. Media policy-making has never been an easy task. Mixing together, as it does, potent ingredients such as powerful vested interests, political influence, social responsibility, rapidly changing technologies and market failures, debate on the issue is invariably explosive and constantly results in front-page headlines in morning newspapers and lead stories in main evening television news bulletins.
In this book, we adopt both a retrospective and a prospective approach to assess how well past and present policies have served the public interest. Our analysis was guided by the fundamental principle that regulatory intervention should be entertained only in situations where the market fails to deliver an efficient outcome and the benefits of intervention exceed its costs. Our conclusion is that many media regulations do not pass this simple test and that, more often than not, policy decisions have been driven by narrow considerations that tend to focus on the protection of private interests rather than safeguarding the wider public interest.
The effectiveness of traditional regulatory mechanisms is increasingly being challenged by rapid technological change. Because of convergence, what used to be distinct services with different delivery platforms are becoming indistinguishable in terms of their attributes and delivery. The Internet and other delivery platforms, such as satellites, are beyond the reach of national regulations. In such circumstances, great care should be exercised to ensure that regulatory mechanisms do not distort market incentives or hinder maximization of economic and social benefits. We make several suggestions for alternative policy directions that avoid some of the shortcomings we have identified and propose four guiding principles for the development of efficient regulation.
We would like to thank the Institute of Public Affairs and particularly its Director, Mike Nahan, for giving us the opportunity to undertake this study. We are grateful to Michael James for his editorial assistance and helpful suggestions on presentational style and to Kate Morrison and Cento Veljanovski for their helpful comments. We also thank the Department of Communications, Information Technology and the Arts (DCITA) for consenting to Franco Papandrea's participation in this study, in a private capacity and in his own time. It goes without saying that the views presented in this book should be attributed only to the authors and should not necessarily be construed to represent those of DCITA or any other organization. Finally, we thank our families for their love and unwavering support.
Robert Albon & Franco Papandrea
About the Authors
Chapter One: Introduction
Social Responsibility and Paternalism; Private Interest Politics; Plan of the Book
Chapter Two: Australian Media and its Funding
Role of Media; Snapshot of Media Industries; Subscription Broadcasting; Regulation of Broadcasting Media; Summary
Chapter Three: Media Competition
Characteristics of Media Markets; Aspects of Competition; Competition for Advertising; Competition for Inputs; Management and Distribution Skills; Networking; Conclusion
Chapter Four: Market Failure In Media Industries
Public Good; Natural Monopoly; Lack of Nexus between Supply and Demand; Conclusion
Chapter Five: Planning and Licensing
Frequency Planning; Licensing; Conclusion
Chapter Six: Restrictions on Ownership
Regulation of Ownership and Control; Media Ownership Provisions; Impact of Ownership Restrictions; Efficiency Effects of Ownership Restrictions; Conclusion
Chapter Seven: Policies for New Media
Record on Management of Technological Change; Converging Technologies; Impact of Convergence on Media Industries; Impact on Competition; Implications for Media Regulation; Conclusion
Chapter Eight: Improving Media Regulation
Specific Policy Implications; Overall Conclusion
Appendix: Historical Outline of Media Regulation
Early Development of Radio; Gibson Committee; The Australian Broadcasting Control Board; Introduction of Television; Turmoil in the 1970s; The 1980s and Beyond; Broadcasting Services Act 1992; Current Regulatory Structure