background briefing 2-2 ..............3

Brave New World of digital broadcasting

ABC's vision for the future in limbo

Under new legislation now before the Senate, the public broadcasters have been denied the right to use their digital capacity to multi-channel. In essence, almost all they can do is transmit in digital to provide better pictures.

They will be obliged to transmit their programs in standard definition TV and analogue (the current system), and further down the track to transmit for 20 hours a week in high definition TV.

In the public interest?

'Prime Minister John Howard was understood to have told cabinet he did not believe the ABC should be treated differently from the commercial TV channels, which are banned from running multiple channels on their new digital frequencies.'

Anne Davies, The Age, 19/4/2000

If the Prime Minister did make that statement, it is extraordinary. We have a public broadcasting service which operates in the public interest and a commercial sector which exists to make money. The taxpayers are subsidising the digital services of 7, 9 and 10, who make very good profits on poor quality television; and the quality public broadcasters are starved of funding.

Audiences lose out

'But what about the public?' is the cry coming from inside the SBS and ABC. 'Doesn't the audience have a right to benefit from all the new things digital TV has to offer?'

According to SBS boss Nigel Milan, the decision means the audience is the loser. He told Media: 'It's stopping us from actually providing richer and more interesting services, against our charter ... it's really a question of the viewers missing out.'

ABC insiders describe the decision as pay-back. One senior manager told Media: 'The Government's position on the ABC is extremely negative, both on funding and the legislation, and you can't characterise it as being anything but that.

In its triennial funding submission, the ABC asked for an extra [$190m over three years] for new digital content and services.

So where to from here? The first priority for the ABC and SBS is to continue lobbying, in the hope they can sway the Senate to let them have their multi-channels. This has a reasonable prospect of succeeding as both the Democrats and the ALP - who together control the Senate - have signalled their support for the ABC and SBS. Meanwhile, says the ABC insider, Aunty has to keep developing ideas for digital TV. "The ABC can't just say, 'Oh sorry, we didn't get any money that's all dropped.' "

But even if the national broadcasters do win the right to multi-channel, there won't be a whole lot of programming unless the Government coughs up some funding.

Andrew Dodd, The Australian, 18/5/2000

Bonanza for the commercial networks

[The Broadcasting Services Amendment (Digital Television and Datacasting) Bill 2000] is a breathtaking document which turns the clock back to the 1950s in terms of its prescriptive approach and the extent of the protection it gives the three commercial networks.

The legislation could have been written by a the networks themselves. Perhaps they did.

Alston and Costello have already sustained a storm of criticism for giving away seven megaherz of spectrum to subsidise their investment in digital technology. The spectrum would have been worth anything between $5 billion and $7 billion had it gone to open auction. The ABC and SBS get the spectrum too, but their ability to use it is extremely limited.

Not so the networks. Alston's confirmation of the digital regime in December lit a bonfire under the share prices of Seven and of Nine's owner, PBL. PBL's market capitalisation increased nearly $3 billion over the ensuing weeks and Seven's increased nearly $700 million.

The networks can't be blamed for asking for so much in Canberra. The sad thing is that the politicians are only too willing to give it to them, no matter what the cost to the taxpayer.

Mark Westfield, The Australian, 12/5/2000