Opening Address to the Commercial Radio Australia National Radio Conference
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Well thank you to Joan Warner for that very kind introduction.
For those who know Joan will understand, when Joan asks you to do something you shouldn’t treat it as a request, you should treat it as an order. And just say yes, because it will save time. Which is why I’m here today.
But I am not here today in my capacity as the Minister for Disabilities, nor as the Minister for Ageing, nor wearing my other hat as the Manager of Government Business in the Senate, but, as Joan has said, in my role as the Minister representing the Minister for Communications in the Senate.
What that means in a public policy or a parliamentary sense is that I am essentially in a casual relationship with the communications portfolio. You know, we fool around a bit and sometimes it’s intense, but ultimately I’m committed to another.
Although when I was at university I did seriously consider going into radio, maybe even radio journalism. My Dad was a bank manager, back in the days when managers had accounts and responsibility. And one of Dad’s accounts, this was in the mid-eighties, was 2UE. So I asked Dad if he could talk to 2UE about some work experience.
So I went along and spent the day enthralled by the news room. The journalists casually playing indoor basketball and cricket within seconds of having to file or read a bulletin. Enthralled by the stories of managing high maintenance and high priced on air talent. Enthralled by the passion of the station manager, Rod Spargo.
Clearly, this was show business. Stars. Talent. Ratings. Reviews. Hirings. Sackings. And more hirings. And more sackings. Air kisses and back stabbings.
And at the end of the day I sat down with the station proprietor. And I was waiting for him to entice me to join the circus. His words to me. “Forget it. Young man, forget radio and journalism. Do something useful with your life.” I was crestfallen.
But it’s a real honour to be here to talk to the commercial radio industry. And what a cracking program. Andrew Denton, Derryn Hinch, Jules Lund.
Radio still has that intangible romance to it, but you’ll be sharing with each other the latest creative campaigns, the best new and emerging apps and new ways of earning revenue streams.
Although the radio industry is sometimes unfairly considered ‘legacy media’, it has a long history of innovation in Australia. The first commercial radio broadcasts in Australia were in 1923 – around the time when Derryn Hinch started his career.
It was the breakthrough of the 1934 Ashes series in England which ensured that it become an indispensable part of life for Australians. During the so-called ‘Synthetic Broadcasts’, telegrams from London were read aloud and broadcast locally, complete with sounds effects of pencils on desks, just seconds after each ball was bowled. Radio has always been showbiz.
We’ve gone from telegrams and sound effects to broadcasts on iPhone. But the medium and the personalities and the shows continue.
Although I must confess to a personal fear about the future of radio in the era of iTunes and downloads. That perhaps some of the shared experiences and collective memories would be lost. That there would be fewer people listening to and sharing the communal experience of radio. Remembering a given summer by a song on the radio. A generation having that shared memory. No more the experience of demographic lock whereby, for instance, someone of my age is forever trapped in a loop of 80’s music. Indeed, my demographic lock is so complete I still keep expecting to find Doug Mulray on MMM, Tim Webster on 2DAY FM and Grant Goldman and Ron E Sparks somewhere on the airwaves.
But my fears were misplaced. What is interesting in this new world is that there is still a strong and lingering affection for radio or, as my Senate colleague George Brandis still calls it, the wireless.
A study commissioned by some of the world’s biggest online streaming companies found that although people are listening to on-demand streaming services more, it doesn’t mean people are listening to traditional radio any less.
Nine out of Ten people still listen to radio and audiences are tuning in at more places than ever before, whether it be at the gym, on the bus or at work.
Radio, at its best, is a very human medium. It is something that connects us, informs us, entertains us and gives us something to talk about.
In the words of veteran U.K. radio industry strategist James Cridland – who will be speaking at the conference later today –
“A list of songs produced by a computer program is not radio … Radio is something that gives you companionship, it surprises you, it gives you news.”
In the past four years, metropolitan radio audiences have grown by 9 per cent. Radio remains a dominant form of media accessed by Australians in the morning – on par with online audiences and ahead of television.
Radio’s morning ‘breakfast’ time slot is still the preferred source of news and entertainment for Australian commuters. All of these underline the very strong financial performance and position of the industry. Advertising revenue, I am advised, for metropolitan commercial radio broadcasters grew by close to 2 per cent for the 2013-14 financial year. And even more encouraging, the radio advertising market is forecast to grow by between 2 and 5 per cent each year over the next five years.
But in the longer term, the industry will need to continually adapt and innovate to ensure it protects current revenue streams and finds new ones. As Brad March, the former CEO of Austereo, wrote recently:
“Innovation will always drive the future of radio. Technology will lead the way by growing radio’s audience and will open up new sources of revenue. Radio, unlike newspapers and magazines, has been quick to adapt to the digital environment and will continue to explore new innovations and revenue opportunities.”
Already there is evidence to show the challenges brought about by new entrants like Pandora and Spotify are being met by services such as Nova Entertainment’s iheartradio, a collaborative venture between Nova and digital music service Rdio.
Role of Government
The Government understands, that innovation and enthusiasm alone will not be sufficient to enable the radio industry to push confidently ahead, and that the role of Governments is pretty simple: to help, not hinder, the shift to new business models and make it easier for companies to innovate.
That is why, in the Coalition’s Boost Productivity and Reduce Regulation policy we took to the Australian people at the election, we set a target across government of reducing regulatory costs to the economy by $1 billion per annum.
Across the communications portfolio, the current media, telecommunications and radio communications regulatory framework is still fundamentally based in a mid-1990s world of relatively stable technologies and business models.
We now, of course, live in a world that has seen the explosion of the internet, the ubiquity of the mobile device, the invention of social media, the rollout of a fast broadband network and the rise of cloud computing.
The pressures on the regulatory arrangements and the negative impact of out-dated regulation on the radio industry will only increase. I know that Minister Turnbull was inundated with suggestions from industry, including from people in this room, since announcing his review of regulation. Let me assure you that the Government has heard industry’s views and is already taking action.
The First Repeal Day
As part of the First Repeal Day, we removed more than 1,000 pages of unnecessary regulation, which is expected to save the communications sector $35 million a year.
The First Repeal Day Bill, which was passed by Parliament last month, contains a number of measures that will reduce the cost of doing business for commercial radio broadcasters.
These measures include:
- reduced account auditing requirements for commercial radio licensees, which will save smaller licensees significant annual auditing costs; and
- reduced reporting and notification requirements associated with changes in control of a radio licence.
The changes also provide the ACMA with discretion to investigate complaints as they see fit, allowing the regulator to focus on the more serious complaints and avoid those that are misconceived or trivial.
The Australian Communications and Media Authority has also been involved in this deregulatory process and has consulted on proposals to reduce reporting obligations on commercial radio broadcasters in relation to local content and local presence.
I am pleased to say that this consultation resulted in changed reporting arrangements that came into effect just over two weeks ago, on 1 October and the ACMA will continue to look at ways to streamline reporting and record keeping obligations.
Second Repeal Day
Following further feedback from industry, the Government is moving to introduce into parliament a number of changes to further reduce the regulatory burden on the commercial radio industry. With the Government’s second repeal day, set for later this month further reforms include:
- ensuring that small radio licensees are not subject to increased regulatory requirements stemming from population changes in their licence area.
- correcting certain licence area planning anomalies with respect to media diversity;
- removing all annual directorship notifications for broadcasting licensees and newspaper publishers; and
- extending the timeframes for notifications for changes in control from 10 calendar to 10 business days.
Many in the industry have asked the Government to look at whether we still need platform specific media ownership and control rules.
At its March meeting the broadcasting and media representatives on the Minister’s Advisory Council were in broad agreement that reform was necessary, particularly where it could improve the economic stability of the sector in an increasingly difficult environment.
The Communications Deregulation Roadmap released in May identified a number of other media policy areas that the Government has been working on through this year – and in response to calls from industry – media ownership was one of those areas identified for reform.
To further discussion, the Department of Communications released a background paper earlier this year. The paper outlined current media diversity and control rules, their practical workings and how they fit into a broader, regulatory setting.
Minister Turnbull has explained to those in the industry who are advocating change that consensus is always a good place to start from to achieve substantial reform. Reform is still on the agenda but it needs to carefully balance two competing concerns – the need for diversity in our media industry and to ensure that we have enough economically viable media businesses to make that diversity possible. The Minister continues to have focused discussions with senior executives to test if consensus can be achieved.
A key principle of the Government’s deregulation agenda is that regulation should only be imposed where absolutely necessary and should not be the default position when dealing with public policy issues. The Government understands the need to work towards technology neutral regulation; however, it should not be done at the expense of one industry over the other.
This brings me to radio internet simulcasts. I understand that some may be disappointed that the Government has not sought to intervene in this issue.
But the Minister remains convinced, and I agree, that this copyright issue should be resolved through the appropriate commercial mechanism and not by government intervention. This is consistent with the practice of comparable overseas jurisdictions such as Canada and the United States, where royalty rates for music used in online radio simulcasts are set by copyright adjudication bodies. As you know, this matter is currently before the Tribunal and Government remains hopeful that if informal commercial negotiations cannot resolve the dispute then the Tribunal will at the final hearings set down for March 2015.
Commercial radio has been strongly committed to the introduction of digital radio into Australia and the Government is aware of the sector’s interest in rolling out digital radio to regional Australia.
You would be aware that the Minister for Communications asked the Department to conduct two statutory reviews on the regulatory regime and technologies for digital radio services. I understand that the Department expects to complete the reviews before the end of 2014 and that the Minister for Communications will then table the reviews in Parliament.
On behalf of the Government, I want to take this opportunity to thank the commercial radio sector for your submission on these complex and challenging issues and we look forward to working through the reviews recommendations with you.
Commercial radio is part of this nation’s DNA. For almost 100 years it has been the backdrop and soundtrack to the lives of Australians. It’s recorded our triumphs. I can still remember running to catch the train to school with a transistor to my ear listening to Australia II win the America’s cup. It records our losses and challenges and no more so than at times of national disaster. Radio reflects our musical passions and our talk back concerns.
Today, its role is both challenged and changing.
The Government congratulates the industry on its determination to navigate these changes and looks forward to continue to do what it can to ensure the industry’s strong future.
Have a great day.