When reform has no bang and barely a whimper

What a difference a year makes. One year ago, when Communications Minister Helen Coonan released the discussion paper which was to become the September 2006 media reform package, was also coincidently the same day that Apple’s iTunes service released its first movie for download - High School Musical, a movie apparently popular with the tween set. iTunes has now sold 50 million TV shows. Apple started shipping their Apple TV, a device which delivers content downloaded from the iTunes service to the family television, in March this year.

The frenzied media commentary which greeted YouTube’s sale to Google in October for $US1.65 billion wasn’t all hyperbole. YouTube only opened for business a year prior, and, due to its popularity, it now plays a central role in modern political campaigns, public relations, and is at the centre of debate about copyright online. No television program with aspirations of greatness can ignore the contradictory importance of YouTube - success on the online social video networking site can mean enormous popularity, but also copyright infringement on a massive scale.

YouTube and iTunes are merely two of the largest services. Video downloading services, in different shades of legality, have sprouted up rapidly over the last twelve months, and are injecting themselves into media consumption habits across the globe. In 2004, an American study found that in the United States, consumers spent roughly 10 per cent of their leisure time online. With the increase of applications and bandwidth since then, that number is no doubt higher.

There are few serious commentators on the media who doubt that in the near or at least foreseeable future, new media will be as popular, important and influential as the traditional print, radio and television triangle was in the second half of the 20th century.

On the one hand, change of this dramatic nature isn’t new. The history of media and technology is scattered with examples of disruptive, radical innovations.

Numerous technological innovations have altered the way we consume, produce and interact with media. The transition in the 1960s and 1970s of magazine printing from the older rotary press to offset lithography dramatically reduced the cost of printing, resulting in the proliferation of hundreds of specialty publications, in contrast with the previously rather limited selection.

The history of popular music was shaped by the potent combination of the use of the FM band by independent broadcasters, and the emerging competition from television in the 1950s. Vinyl recordings, tapes, CDs and MP3s - and the devices they are played on - have further altered our relationship with popular music, and the content of the music itself.

Similarly, entrepreneurs have altered patterns of media consumption with existing technologies with innovative new business models. Charles Dickens serialised his novels in popular magazines, changing the nature and structure of his stories, and creating new market opportunities to great effect. The practise of block booking, where film studios bundled multiple films together to sell to theatres, buttressed the Hollywood studio system, until it was prohibited by the Hollywood Antitrust Case of 1948.

The history of media is change, not continuity.

The dynamism of technological innovation couldn’t be better contrasted than by the narrow approach taken by governments to media law and regulation. It is a consequence of the inertia of the political process that major regulatory changes can be enacted perhaps once a decade. When policy is made and reform is pursued it must be forward-looking enough to facilitate unexpected changes in the industry it is trying to regulate. By this measure the government’s 2006 media law reforms were a regrettable failure - after ten years of promises to liberalise Australia’s media regulation, the package passed in Parliament in October had no bang, and barely a whimper.

Minor adjustments to ownership rules, the introduction of two crippled “non-traditional TV” licences, loop-hole closing in anti-siphoning regulations, another delay of switchover to digital television - it is only by force of habit that the package was referred to by commentators as “reform”. Where large regulatory decisions changes were made, they went in the opposite direction. Regional and rural radio licensees ended 2006 staring down the barrel of a draconian array of new regulatory controls, designed to keep rural politicians on the air, rather than increase any level of local “diversity”.

The federal government’s reluctance to pursue any meaningful reform after such a long build up is most unfortunate. The laws which govern Australia’s media are a fragmentary web of protectionism and restriction. It is hard to beat the Productivity Commission’s characterisation of a regulatory framework that “reflects a history of political, technical, industrial, economic and social compromises. This legacy of quid pro quos has created a policy framework that is inward looking, anti-competitive and restrictive”.