Project Timeline 2005–2010

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Proof of Concept Phase – Interview E

Categories: Interviews, Proof of Concept Interviews, Support Material
Date: 26 April 2005

Andy Lloyd James: …we are on record…

Interviewee: [xxxxx] do anything about it.

Is this the University’s, or yours?

That’s mine. I feel I could have waited a thousand years [xxxxx] [laughs] Now I knew the only way for some stuff which I’m doing for Foxtel, but its’ a beautiful piece of [xxxxx].

Mm, hmm.

So the project itself is as much about content in 2015, as it is about technology and those things. And really what I’m looking for is just what, first up, what you think the key issues are that are going to get us to 2015?

What in terms of content or…?

In terms of politics, economics, society and technology, in the broader sense.


But clearly, I mean that, but within the terms of the industry as well.

Well, okay.

You know so [xxxxx]…

Well let’s, for no particular reason just think about the politics of it. The thing I think that you see about… you can say about the structure of broadcasting in Australia is that it has always been in a way that perhaps isn’t the case in other countries, very heavily influenced by politics and decisions about when we have new services, and the structure of services are pretty much made at the political level, rather than any kind of administrative level, in that… obviously the most pressing political decision that needs to be made as to whether or not to change the media ownership laws which would, you know, particularly the cross media which would effectively take us back to the situation that existed 20 years ago before they were reformed. Are we going to get new free-to-air television services? I think that’s still an open question, and again will be decided as I said, you know, this political interplay between what politicians think they want or want to give or get from the owners, and that’s why I’m saying that politics has also been heavily influenced by media proprietors on the way in which things are structured and you don’t, I think you only have to look at the way in which digital television has been mishandled, and there’s some introduction here to see that what should have been good policy outcomes have been heavily influenced by commercial priorities.

In you experience Nick, is that… is Australia unusually, or Australian television unusually dominated by those political forces or are they – I mean political forces in the broad sense – or is the same true in the United States and the United Kingdom and elsewhere?

I think that perhaps to a certain degree, Australia is more like the United States. On one level it appears that… there isn’t as much political interference in the United States because the Federal Communications Commission has a modicum of independence from the Administration, so you don’t often see the President for example, venting his views on broadcasting policy, etc.


But what you do see is I think because the whole bent of the American system has been towards a free enterprise, you know, and just let as many stations, broadcasting stations happen, that’s the spectrum and commercial interest will bear. I… where I think the political interplay comes is between the local stations and their local political [xxxxx], Congress is the one who intervenes. So for example you saw last year when FCC proposed to change the ownership laws.


It was Congress that intervened and told the FCC that they shouldn’t. So, it’s where… and comparing it to the UK, I think the thing you need to bear in mind there is that the UK system didn’t start out as a commercial system and there’s a much deeper and broader consensus I think in the UK about broadcasting as a public service institution, that’s servicing particular goals in terms of education and information and so on. So even with the privately owned broadcasters, I mean the fact that the public service remit of ITV or Channel 5 for example, goes largely unquestioned by the commercial interest, and it’s got so deeply imbued that it’s something they know that they have to do. And that’s something I think which is missing from the Australian system, and I think is a problem going forward for us in that, the whole notion of broadcasters serving public service seems to have faded into the background, in the last 10 year or so.

Except where the regulations compelled them?

Yeah. Yeah. Well you look at the Broadcasting Services Act, and it’s got things in it about quality and innovation and so on and so forth, which are all very high-minded goals for a broadcasting system, but there is no mechanism by which any of that is ever assessed. I mean the ABA as a regulator doesn’t do that, and there is no value for it because licences get renewed automatically, and the ABA hasn’t really done a kind of temperature check if you like as to how the Australian Broadcasting system is progressing. And so, in that sense I think that whereas before the level of commitment to public service was relatively weak in Australia as compared with the UK, I think it’s because it’s just not talked about anymore.


That is going to be, the way I see that being an issue is if, you know, looking forward 10 years, is if we start to see a system whereby there are more channels, and they are more privately owned and therefore commercially driven, if there’s no general consensus on what the broadcasting system is supposed to be doing, other than earning profits for shareholders, then that’s going to be a problem for the nation as a whole, and it’s also going to be a problem I think for the public broadcasters because if that whole notion of public interest gets more and more weakened, people will start to say, ‘well what…

Why have we got this?

Why have we got the government pouring money into the ABC and the SBS, when we’ve got so much more choice. And I think that’s a problem for the Australian Television System is that, it has been for awhile, is that the ABC and SBS are weak compared to the public broadcasters of other countries, and they are getting weaker in terms of the resources they have got available to them to fulfil the remit.

Has there been much – I just want to check on this thing, it is working isn’t it?I don’t quite know how to express this but you’ll know what I’m trying to get at, has there been a time in the history of television in this country when governments thought more forcefully about the serious value of the public broadcasters, or has it really just been a slow whittling farce?


See what I’m trying to…

Yeah, yeah.

People say that, you know, it’s the Howard Government and this, that and the other, but then I mean even from my own experience you could say, you could have been saying the same thing 25 years ago. I think it’s more focussed now.

I think it’s not easy to say that there’s a slow and steady decline, but I think that when you go back say to the 50s and the 60s, when the level of resourcing of the ABC compared to the commercial sector was very high because the ABC had a guaranteed source of revenue, which was listeners licence fees. Since the time that they were done away with, which I think was in the late 60s or… yeah, and they’ve been reliant on direct funding, you see the revenue to the commercial sector keeps on increasing year in, year out.

That’s interesting, yeah.

Whereas the ABC’s doesn’t, and it lags behind. I think that probably you’d have to say that the 50s going into the 60s probably were a high point for the ABC in terms of the government understanding why they had a public broadcaster and, by that stage, what were also being resolved were issues that had been major ones in the 30s and 40s, like should the ABC have its own news service…


And be in competition with newspapers interests?


So in the 60s when you’ve got for example, the evolution I think of a really strong independent news and current affairs service for the ABC.

With TVT?

With TVT, and all of that sort of thing, when it really was in many respects an agenda setter for the television, the commercial television sector. My guess would be that that was a high point, but I think… look, again looking into the future, my fear is that as it becomes much more easy to deliver many more channels, as people’s entertainment options if you like become broader, as they have through access to the Internet and games and DVDs and I-Pods and all those of things, you know, the attention to television is going to be a problem and if it was simply left to the market place to decide rather than the government and society really working on a set of principles as to why you would have a public broadcaster and the kinds of things that a public broadcaster can deliver in terms of the level of information, education both in the formal sense and a more general sense. And the kind of innovation and quality and entertainment that could be delivered by an organisation that wasn’t purely driven by a profit. I think our broadcasting system will continue to need that kind of organisation, even more as the number of channels proliferates.

Mm, well yes I mean I was interested when you talked about the number of channels earlier on because the… I mean clearly one of the things about the amount of competition, be it actually direct television or competition in the form of channels or just other platforms starting up, other medias starting up. One of the issues clearly is, is where the advertisers go with the world [xxxxx], and immediately behind that issue, what then is the future for Australian content? Of all kinds, on commercial television and is there a, is that maybe a reason why which… for which governments may look to boost the public broadcaster?

And I think… you know what they’re doing in England at the moment? You know, Dot Com is talking about boosting public service broadcasting in order to unleash the ICVs.

Mm, mm. Is that possible here?

Well I think anything is possible, what it requires is a level of commitment and will to do it, and it also requires a level of resources which in the past, the government hasn’t been very willing to commit. I mean the television system, the Commercial Television system started in Australia on the basis that it wasn’t going to cost the public purse anything. So it had restricted competition in order to guarantee there would be a level of profitability, so that the private interest could afford to run a system, and ever since that time, you know, the government’s survived the persuasion except for Paul Keating’s brief experiment with the Commercial Television Fund, had been largely unwilling to spend any money on the Commercial Television System, and also tend to be reluctant to make the hard political decisions that might required it to be restructured. I mean, one of the fundamental problems that television system in Australia has got is that – and this was right from the beginning – is that, unlike Britain, the government decided it didn’t want to own the transmitters. So that’s what I meant about it, wasn’t going to spend any money at all on the system, and when you’ve got commercial interests that have spent hundreds of millions of dollars on a transmission system, the idea that – and this has happened in the UK – that you might want to restructure the way in which privately owned television is delivered, immediately faces any government, apart from all the other political crosses, with the question of, well how are we going to compensate the commercial interest for the loss of their investment?

That’s a fascinating question. Somebody else had said to me, on exactly this issue, not on the issue of the transmission – I’ve not heard that raised before, somebody else had said to me and it goes back to what you said at the start about the way that Australian television has been to some extent dominated by political interactions, had said that one of the reasons that governments are so conservative about their dealings with the broadcasting industry and leaving out [xxxxx] transmission, was that the government itself because of its intrusions over so many decades is actually seen as being responsible for television in this country. A bit in a way that the governments in quotes are seen as being responsible for water and power and that kind of thing.

Oh, you mean responsible in the sense that it’s some sort of utility that they…?

Yes, exactly, that if you [xxxxx] in other words I could no longer get Channel Nine that wouldn’t necessarily be Channel Nine’s fault, but I will certainly be screaming at the government to do something about it. Does this, does that figure?

Mm, yeah, look I think… I think there is an element of that, but again I mean that’s’… I think governments have had a kind of schizophrenic idea about whether or not they would be, they are responsible for delivering a television system and what the qualities of that television system should be. But certainly they have been over the years responsible for making decisions about the structure of it, and we see signs of that again in that the government’s saying that if we are going to get a fourth commercial television network, the decision on who gets it is not going to be made by the ABA, it’s going to be made by the Minister for Communications, and clearly, that’s an indication that this government at least sees that as a decision that it can’t afford to delegate to a regulator, no matter how responsible or independent, it might think it to be. But if it’s really true that governments thought themselves responsible in that sense I think you would have seen them thinking a lot harder about, you know, what it is that they might want the public to get out of the television system.

Can you talk about that a bit, because again you raised it right at the start the way in which the whole issue of digital television, that data casting and all of those kinds of things, there was really far too [xxxxx]. (loud traffic noise). If they stay as they are, what does that mean for the future?

You mean if we stay with this… the dual system?



And with the limitations, the artificial limitations that have been thrown at it in terms of the data casting and transmissions and all those kinds of things?

Well I think you would have to say that in terms of the… just in the terms of the prospect of the conversion to a fully digital system, I mean, you’re looking at going way beyond even 2015, before… there is a complete switch-off, you know you’ve probably heard this before but I mean the… no government I believe is ever going to make the decision to switch off the analogue system until there is 100% conversion.

Right down to the last.

Yeah, I mean tell 10% of Australia that they can no longer watch television, and that 10% is likely to be in remote regional areas where there is a lot of political…


Yeah! The…

So that, as an issue leading toward 2015, that really has to change?

Yeah, and I think that the government has got to look at some more incentives to drive people to take up digital, other than better reception. I mean clearly that’s not working. Now whether that’s allowing the free-to-air’s to multi channel and have a… you know, provide extra services, that’s… and I think that’s still to be worked out and clearly there is also a division amongst the existing players as to whether or not they do it, or how they do it. I think also the government is like, as occurred in the UK and Europe, you’ve got to look at some sort of financial incentive too, particularly for people of lower size income levels to, you know, convert to digital system. The pressure I think that is going to come upon them is going to be for people who have thought up uses for that spectrum that’s now being occupied by the commercial networks. And want some… you know things to move faster so that can be used for other purposes, or whether or not the existing players think that they’ll, you know, they’ve bought themselves some time, and they’ll think up a reason why that should continue to hold onto that.


Respectfully, because they’ve come up with another use for it.

So unless it gets driven from the top, then it will be a very, very long time before the country actually gets the benefit of what people call the Digital Dividend.

Yeah, I think so, I mean what’s the penetration rate now, it’s only about 3% of television households, which is pitiful compared to the UK where it’s steaming towards 60%.

Issues of digital television?

Yeah. And in some parts of Europe which have already made the… what’s it… I think it’s Hamburg and other parts of Germany have turned off their Analogue Television Service already.

It’s… just to go back to the middle of it for a second, is this really fundamentally about a lack of… a lack of vision in government and the industry or a lack of vision in one or the other, or is it really just about not wanting to move very much because things are okay as they are at the moment?

I think it’s got to do with a, you know, that kind of resistance to change, to that kind of antrophy that you know is always there. I think also what we are lacking is, you know, thinking that who moves away from staying in particular compartments, people talk all the time about convergence. And there’ve been convergent reviews and things like that, but what we don’t seem to have done is really I think, not thought deeply enough and consistently enough across the whole spectrum of, well really what does convergence mean for the way in which we might want to structure our broadcasting system, how is the broadcasting system going to integrate more fully with the telecommunications system, and not just in the commercial and technical sense but also in terms of what kind of leverages are there to provide a dividend for the nation in terms of creating new content, and like, for example I know that just through conversation last week with Meagan Elliott from the Writers Guild, I mean they are wanting to get a conversation happening in public about, well we’re looking at some momentous changes in the terms of the possible sale of all or parts of Telstra, shouldn’t there be some sort of real financial dividend from that in terms of investment into content creation and they are looking at the models in Canada where the government and the regulator there require, as a matter of course when there’s a large transaction in telecommunications, that part of that is paid back as a dividend…

Really? To content producers?

To content producers!

Ah, that’s fascinating.

So I mean there are ways that the government could be thinking about how it rams up the level of investment, aside from just asking it to put its hand deeper again into consolidated revenue.

And it could also… I mean that… a move like that would be absolutely invaluable in starting to open up thinking about how you devise business models to… assuming for a moment that, at some stage it’s conceivable that commercial revenues will start to decline.

Mm, hmm.

Because of the fraction… the fragmentation of audiences, and therefore the amount of money available to Australian [xxxxx] to [xxxxx], a move like would already have the core elements of new business models in place.

Mm, hmm. Well another example would be, I mean, say the government decides that there is going to be another commercial television network, we then really need to ask the question: well, do we want another commercial network that is a clone of Seven, Nine and Ten, because the odds are it would in practical terms just end up looking like Fox 8, lots of re-runs of stuff that has already been seen on commercial television, you know. The government’s preferred model at the moment is price-based allocation, well why not say… you know, say for example someone is willing to spend, pay a billion dollars just for the privilege of spending more money in setting up the broadcasting system, why doesn’t the government say, for example, well you know, we are going to take less money if you’re willing to… we want bids from people, not to pay money into consolidated revenue, but to provide a new service that’s going to have Australian content production, so you start a competitive process whereby the government says, you know, that money isn’t just going to go into our pockets, it’s the kind of promise that’s…

Direct feedback.

It’s a direct feedback. You will get access and you know, it might be a combination of a beauty contest and cash on the table, but already you have a new commercial player that has got a different remit from the…

The current three!

The current three. And some people say, well wouldn’t… isn’t that not having a level playing field, well in the UK they seem to have been able to do it with 4, you know 3, 4 and 5 each having different…


… objects in terms of what they’re doing, but still basically being commercial enterprises.

Yes, it’s fascinating to see how Channel 5 has been sort of slowly morphing itself through a series of existences, I mean now, as I’m sure you know I mean astonishingly one of the best outlets for arts programs in the United Kingdom is Channel 5, quality arts documentaries which I think nobody ever expected we’d be seeing there at all at the start. But again, I mean that will be an enormously, you would think that expressed properly to a government that could be enormously attractive to them, because it would maintain some notion of public service remit, whilst again whilst having the capacity to free up the others.

Yeah, the other thing that I’ve – and this is sort of off the question, but the other thing I wonder about is that, you mentioned before the effect on advertisers, as you know, whether in 2015 television is still going to be a mass medium, I think it probably will be. The issues are going to be that they will lose viewership to other competing medias, and one is already seeing that at the present time, particularly amongst young people, but then on all medias for young people, newspapers have lost readership amongst young people, radio, all medias have lost because they’ve got so many more options these days. But I was just thinking that, you know, it’s hard to that in 10 years time whoever succeeds Leyton Hewitt in the final of the Australian Open, what was there… 4½ million people watching, I can’t believe that in 10 years time a large percentage of those 4½ million people would be willing to pay to watch that, which would be the only other option, if there was no mass market television. Some would, but a lot of people who wouldn’t be unless it was so incredibly cheap.

I think that’s right but I think… I mean, which is an irony because they’re probably more likely to want to pay for that than they want to pay for… a standard piece of cloth,but it seems to me that the one place that the networks will have room for… oh sorry, one of the places where the networks will have real power and go on having real power is with those big events, live events or those things which I think they’ve been extraordinary clever about, constructing events whether they’re Big Brother or Michael or whatever, and constructing them so that they are cross-platform, cross-media deliveries in a really sophisticated kind of way. What fascinates me is whether – and here I’m asking you in your old spa [xxxxx] – whether that kind of thinking can attach itself or whether everybody is looking at attaching that kind of thinking to what anyone of us might call the ‘quality end of television’, quality drama, quality information documentary programming, that kind of thing. Whether there is anybody who is actually trying to work their way through business models for that sort of programming.

I think… one can see that there’s different business models being thought of and particularly as we get technology that allows for people to avoid watching advertisements, then advertisers are going to want to think of different ways in which they can get their brand image before people rather than the 30 seconds commercial. That’s going to mean for broadcasters that they’re probably going to have to give up a level of control that they’ve enjoyed up to now over their programming, because once you get advertisers in there actually constructing the programs, you get back to, well the kinds of things that used to happen in radio days in Australia in the 30s, 40s and 50s where the radio networks in Australia were really created by the advertisers not by the stations, because they wanted to ensure that their ads had a national focus. So I think that it’s relatively easy to think how with quiz shows and reality type programs, how you can like weave a brand into that.


It’s much more difficult to think of how you can do that with a drama program other than the advertiser saying, you know, this is the “Cadbury’s Drama Hour” or something like that, or straight up product placement.

Yeah, I know it is a real issue. And again I mean if they did, if audiences start to diminish, and if revenue starts to diminish, I mean we are talking again about the most expensive end of turn, which is the production of any kind of quality or to production. I mean it seems to me that there is a potential, unless the government thinks very hard about it, unless the industry thinks very hard about it, or the industries, that Australia’s always tenuous production industry could actually be in really, really serious jeopardy.

See, I don’t see our government thinking in the way that the UK government has been thinking about when they looked at, you know, the new communications bill in the White Paper, I mean part of that, a big part of that was how can we use changes to the structure of the broadcasting system to really make the independent sector in the UK healthy, because its very clearly stated objective was through all of that was to make the UK one of the strongest communications and media markets in the world. And not just in terms of commercial broadcasting or telecommunications providers, but also as content creators, and I think that there’s a problem there which is that in the way in which governments have thought about why they are supporting content creation, is that it’s largely been justified on cultural grounds and not in terms of well, it’s not only good, it makes sense in terms of cultural outcomes but it’s good economics as well. And, as I said, that may mean the government has to think about more innovative ways in which it can kick more money into the creation of content, because you will see that broadcasters just left… commercial broadcasters just left to their own devices, will always do what is best for their shareholders which is to keep costs as low as possible, and maximise profit, and producing high quality drama is a very costly and very high risk enterprise.

Extremely high risk, yeah.

And the… I mean you know all of this, I mean it’s, you know, the producers in this country have had 15 years or more in which they’ve had to try and fund wider and wider deficits for drama. You look at a company like Grundy for example, aside from Neighbours, it doesn‘t do drama anymore because there is no money in it. And they’d be no money in Neighbours if the BBC decided to cancel it.

It’s one of the things, I mean it’s one of the things really people tend not to think so much about, for which you’d know the absolute core of from a variety of experiences that you’ve had and that is that this country, absolutely unlike the United States or the United Kingdom, has only ever been coming off a level of about 55% Commercial, or ABC, 55% to 60% maximum Australian content. So it’s… whereas the Brits I would imagine are probably up around the 90% mark, 85% to 90% whatever, the United States I would imagine even higher. So that they have been able to deploy if you like the entire value of all of their network systems in one way or another is feeding into an independent production operation, here is, well it’s certainly not even 55%, because so much of that’s news, current affairs and sport. And so the pinch really does come very quickly in this country if you start to make it very much harder for independents to try and get those budgets to work.

Yeah, absolutely I mean the… it’s not, I mean there’s the comparison there in terms of the amount of output, but also if you look at another measure which is the amount of revenue that’s actually invested in program production, I think you’ll find that Australia has one of the lowest percentages in the world.

Is that right? This is for in returns, revenue to the commercials?


I’ll check that one out, thank you for that.

So, and the money that they’re earning is going back as profit. And you can look at the figures and for example the Productivity Commission’s report about the year, you know aside from the late 80s, it’s year in, year out, increases in profitability. And their earning levels of profitability, which I think would only be outdone by the Banks, I think, in this country.

Where do you see the TELCOs going in all of this? Do you see the TELCOs well most particularly Telstra, but do you see them moving here, you know there was that huge move in late 80s, early 90s, there was a huge move towards sort of converged content provider / carrier model, do you see that re-arising over the next 10 years or so, as they start to hunt around for content for different platforms but then obviously you start doing the [xxxxx] work about [xxxxx] to make it more worthwhile.

Well I think there are some big issues that have to be got over before then which is the government clearly want to prime privatise Telstra, but I.. the major problem that it’s got is that if it does that, and it doesn’t solve the issue of competition, then all it’s going to end up with is maybe a lot of money, that will go into retire debt, but it created a telecommunications company which has now got entirely private ownership and is still the 400 pound gorilla! Now the… so what you end up then is how do you deal with those competition issues, I mean one way which some people are talking about is breaking Telstra up, so that you create smaller companies, which is kind of a variation of what the US did 20 odd years ago when they broke up ATNT and turned it into a series of smaller telephone companies. You see, I mean Telstra, like some of the other companies, is already converged in the business sense, it’s got Foxtel, with its directories business, Sensis, and it’s wanting to try and grab some of the revenue that goes into classified advertising and newspapers, so… and they’re thinking about with the possibilities of the new mobile phones, of what kind of content that can be delivered on that, and we saw in the last week the complaints already coming in, but because Telstra is linked up with Foxtel, and one of the things that could be delivered on that new mobile phone is video of, you know, you could be in a bus and watching Leyton Hewitt, and who has.. you know and there is all these connections here, so, you know, and the others are saying, wait a minute, this is all being sewn up again! So again it comes back to a competition issue. I am not sure what the answer is to be honest, but I think there has to be a more concerted effort on the part of government to come up with some sort of answer to introducing more competition, I mean on one level it’s been done by allowing more licences but the market share, there is always new telecommunications companies [xxxxx] are not very high, and they are clearly failing as the Regulator say, I mean the ACCC said recently that it has difficult.. it has a whole lot of difficulty actually getting the information it needs about what Telstra is doing. And there will continue to be argument, like the argument that has been had in the past about, well, the government decided that it’s clearly, there is a public interest to be served by having a universal access to telephony, you know, basic telephone service, so Telstra has got the universal service obligation, but the other telephone companies are supposed to subsidise Telstra in doing that, because look, reasonably well it’s… Telstra is not going to pay for it all by itself but then there are constant arguments about how much is the Universal Service Application actually costing Telstra?

Yep, nobody can drill into all of that.

No, or why is it that as we all know, that the cost of renting a landline has increased dramatically over the last 5 years, but there has been no dramatic increase in the quality of telephone service to justify it.

It’s a six [xxxxx] TELCO world [xxxxx]. Looking… then looking ahead and I think these are questions 2 and 3, the best and the worst outcomes for 2015?

Well I think the worst outcome that we could have is a television system in which the commercial networks have lost market share to other forms of television, and their revenue basis are either flat or contracting, and in that… so that their ability to fund new Australian content is diminished but, you know, subscription television has no new obligations on it to take up the slacks, so I’m saying in 2015 say 60% of Australia is getting… subscribes to subscription television, will we see the [xxxxx] of equivalence of Showtime America or Home Box Office, whether doing those really innovative Sopranos, Sex And The City type things, you know or are they just providing the same sort of…


Churn of staff, and you‘ve got public broadcasters whose chronic funding problems have become even worse, and so their ability to take up the slack is also there, so you end up with a… you know the worst outcome would be to have a television system which is apparently on the surface, looking like it’s providing a great diversity of output, but it’s… it really is what Bruce Springsteen described, 50 Channels and nothing on, type of thing.

Is it possible, I don’t… I’ve forgotten to ask about subscription television, is it possible with the Free Trade Agreement, nine players, is it in fact possible to regulate subscription television beyond where it’s regulated at the moment? Or is that… Is that new media or is that not new media?

That’s not new media. You know, I mean the requirement there is that we can’t, we can up the expenditure requirement by up to 20% from 10%.


But it can’t go beyond that.

And it can’t step outside the [xxxxx] to which it’s already attached?

It can go into documentary and I think… I have to remember whether it’s children’s or not. So yeah, you know, that is a… that’s another problem for the government too, is that by agreeing to the Free Trade Agreement it’s cut off one of… you know its ability to move in one of the tools that it wouldn’t ordinarily have, which is the ability to regulate. I think though that with a bit of innovative thinking the kinds of things I was thinking about before, so where you set up funds and subsidy mechanisms, but they may not be constricted in the same way as a result of the FTA. So, yeah, I mean that’s the worst outcome.

As it stands, doyou… if subscription television goes on down the path that it’s going at the moment, which seems to be in the large, purchase of domestic rights for material that’s being made in lots of other countries in the world, plus news and current affairs and that sort of thing [xxxxx] but no real impetus to create new material in this country. Do you see that form of subscription television as going much beyond the 25 or whatever it is percent that it’s got at the moment?

I think one of the issues for subscription television that’s stopping people at the moment is actually the sheer cost of it. You know, it’s what, if you get the whole, leaving aside the digital movie package, if you get the whole Foxtel, it’s costing you nearly $90 a month.

Yes that’s [xxxxx].

Which is I think a big disincentive to… well it would be a big disincentive to a lot of households in Australia. I think the other thing that’s happened with Pay Television here is the timing of its introduction that coincides with the arrival of DVD players and the huge explosion in DVD. I mean I think that’s going to be another interesting issue to look at too as to whether or not, in fact for content creators, DVD might end up being the way in which you can get out into the marketplace, without having to go through some of the more traditional gatekeepers.

Some of the advertising people that I’ve talked to have talked about this and they’ve talked about the reality that in the fullness of time, whether it’s in the next 10 years, that there is likely to be a far greater range of I suppose single point to single consumer relationships than currently exist and in fact, I meant to put it into net terms, what broadcast television is is fundamentally a distribution operation and if you can distribute wider but not necessarily domestically, then why would you stick with the broadcast when [xxxxx] in fact that whole set of relationships that currently we have with networks, again it could be in the [xxxxx] but not, this is not tomorrow.


And it’s not going to happen presumably with the speed of falling down the staircase but that’s… (noisy background) I mean I suspect one they’re looking in advertising that was t-bones and that kind of state of the art technology, which doesn’t allow you to (noise in the background) start to shape your own profile and your own [xxxxx] the way you want it shaped.

Yeah, there’s that and I think the other thing too particularly for content creators is that the combination of DVD and the Net provides a means by which you can do it all yourself, you can have an absolutely direct relationship with the people that you want to buy your film, and there are examples of that having happened. I mean the… that show that was on the ABC last night “Outfoxed”, the way that they… It ultimately got a conventional distribution, but that way in which that was launched last year in the United States was that they organised a series of events across the country, invited people to come, and they bought a DVD copier on it, and then they used the net as a means of distributing it. I mean partly that was a political decision because they had to get it out there before Fox could do anything legally to stop them. And once enough people had seen it or had copies of it, the… Fox obviously made the decision that it was probably only going to exacerbate that and give them greater notoriety if they tried to…

I mean it’s fascinating, it’s really Tupperware meets Television, or Tupperware meets the audio/visual industry. And [xxxxx], as you know there are documentary producers in this country who are already exploring that as given that it’s so difficult to get a documentary funded in this country. We’re exploring that as a way into the future that instead of trying to find 200,000 viewers in this country via one broadcast, to try and find 100,000 viewers right the way around the world for 10 bucks each, 5 bucks each, or whatever to pre-purchase or up take the punt and [xxxxx] with it. But they’re looking at that as a serious business problem.

Yeah, one…

What’s the best outcome?

I think that the… well, the best outcome is really at the antithesis of the work, which is that we see firstly a public broadcaster that has not nearly maintained the level that is now, that actually improved its ability to invest… doing what I think public broadcasters should do, which is to have a remit, to invest in programming that is of a high quality, and however you manage this quality but innovative in some way that it’s exploring things, wether it be drama, programming or a documentary or new forms of television.


And doing it in a way that’s obviously exciting and creating… creative and that’s got resources available to it to do that well. The best outcome would be I think when the government looks at introducing new services to be really thinking hard, so that we have an outcome in 10 years time, that the new services that have been introduced are not just tired versions of what we’ve got now. But are also doing different things, that have got some sort of remit other than simply making money for the… whoever their shareholders are. And it doesn’t have to be an onerous remit, by any means. But there is a… and that we’ll have also reached the stage in the debate about what broadcasting does in society that does still talk about public interest, you know, that…

Across the whole.

Across the whole system, and it’s not simply just a means of entertainment that is there for commercial ends only, but it’s actually got some purpose, that it’s functioning as the…you know, one of the ways in which we for example, exchange ideas about the kind of society that we’re living in that does already but in a more, you know, conscious sense of thinking, of well, this is why we’re here, but I mean – and I’m not decrying Big Brother or anything like that, I mean obviously they do say something about society that get in and do that in a way – but it’s not as though there has been a…in a public policy sense, a real concerted effort to think about, well, what is it that we really want the broadcasting system to deliver, that will make this a better society, a fairer society, one in which people’s ordinary discussion and debate is helped and engendered by what the broadcasting system actually delivers, but it’s not something that impoverishes public life, but actually enriches it!

Yes enriches it, but then you see it’s fascinating because you talked a couple of minuted ago about the debate on the issue, of course, reality is the reason why.


It is, I mean for reasons which I suspect are partly to do with the cross-media regulations at the moment because certainly, you know, the newspapers are not prepared to discuss it in any serious sense except to say just we need to have as many players as possible, and it’s better [xxxxx] to control. The television stations are not going to discuss it seriously, there is… I mean it is…. what I hope in the fullness of time will be one of the outcomes of this is actually to put a whole lot of tools in the hands of those who wish to start a public debate or at least try to.

Well, you mentioned journalism, I mean when you actually sit down and think about it, there is a lot of journalism about television, in the newspapers, but most of it is either just, you know, a straight reportage or whatever else. There is this whole kind of attitude that amongst the television journalists to write in a kind of smearing way about television, you know, a kind of superior way, in a way that you wouldn’t… you look at the literary pages of newspapers and where people write reviews of books which actually treat the print medium with a level of seriousness.


Whereas with television, the whole tanner is… well it’s inconsequential, it’s here today gone tomorrow, its flim-flam, so let’s just treat it that way. So you don’t get that on a level of discussion because, you know, journalisms is not encouraged to write in a serious way about television to ask those questions.

And certainly the points at which, at least in my experience, the points at which you… politics or the ownership of networks and newspapers comes into play, you can see the house shutting down very quickly indeed.

Mm, hmm.

What needs doing first? I mean let’s assume for two seconds that you want to head towards the kind of best outcome which you were talking about, which is certainly may be hard to achieve but it’s not unrealistic, but what are the sort of key things that need doing first or what of the flocks do anything happening on this? It seems to me that at least having a digital public discussion about ownership would not be a bad thing now, but it’s not necessarily a priority. What would you think the priorities are?

Well I think structurally what needs to happen is some… at the government level there needs to be some sort of coordinated and deep examination of what… where the broadcasting system is now, what are the problems with it, what are the weaknesses with it, what are the strengths, what are the sorts of things that we want to try and identify, what is it that we actually want to come out of the broadcasting system, other than efficient use of spectrum or, which seems to be the narrowness of what the public officials have been given to talk about in terms of… and when you talk about broadcasting policy it’s about, you know, efficient use of spectrum or competition and not talking about the…

Public value.

The public value, the cultural goals, and there are… so there needs to be a commitment at government level for that sort of thing to happen. It may be –and I think also what we’re suffering from is that the opposition at the moment is in such disarray, I mean they‘re not poking the government to have those attitudes, so they are letting the government off the hook – and I mean there is no doubt these are hard questions to ask and it’s, you know, we’re at a moment, a political moment where we have got a government that can almost, you know, think that it can coast the next election, that has not, is not evidencing this in other areas of what governments do, it’s not evidencing that it’s got a lot of bigger ideas, so you’re not seeing a government that’s committed to really thinking creatively and a whole of our engine there is not just broadcasting about where the country should be going, because the political reality is that they’ve been able to manage by and with the complicity of the opposition, manage to keep themselves in power through, I think, a series of fortunate circumstances for an economy that, you know, that keeps on growing so that people feel comfortable and relaxed and, you know, not wanting to think about those…

In a collapsed opposition.

In a collapsed opposition. And as you say, we’ve got a… we’ve got a media that to the extent, you know, on the one hand, it loves to talk about itself, that doesn’t talk about itself in a very creative or far-seeing way, and I think the problem with the producers and writers and directors and actors is that they just find it so hard to get together and try and get this concerted debate happening, you know, which is not to say that it can’t happen. I mean you look about… look at what happened over the free trade issue, I mean the – and that was a really concerted effort – but what you ended up with at the end of the day, at the end of the negotiations, what were the two key issues that had top of the public mind was pharmaceutical benefits and Australian content on television. And a year before if you said that a government was prepared to walk away from a trade agreement on the basis of Australian culture, people would have laughed at you. So I think that demonstrates that it is possible, with a sense of will and purpose and direction, to get that sort of thing happening.

Well tell me what the dynamic of that was, because it seemed to me that it wasn’t necessarily even [xxxxx] a sort of huge driver for the public it might well have been, but not that it really put the hard word on the government, what was that? Was that to do with… I suppose what I’m asking is was that in fact, unbeknownst to me, was that in fact a huge groundswell coming out of the public or was this an extremely finely focussed piece of logging on particular ministers?

There was… you know because I was involved in it.

I know, that’s why I’m asking.

The… quite early on because we had access to some of the polling that the ALP had done, that showed that Australian content was a proper mind issue.

Really, it really was.

With a large proportion of the public when asked the question, if we are going enter into free trade agreement with America, it means that there will be less Australian content on television, should we do it? And the answer, the majority said NO.

Oh, that’s fascinating, yeah.

Right to the extent that until the end, it wasn’t something that you had a lot of the general public writing letters to newspapers about and also the strategy that was decided on quite early on was one… when the negotiations began which was to not carry that debate out in public, but to really focus on the government in saying, look this is a serious issue for us, we want to help you get the best outcome out of these negotiations by giving you the information, the ammunition, etc, etc, etc, that you need to use to take to the Americans. And afterwards, when John Howard made the decision to accept the deal that he did, to then concentrate on the opposition to get them to make it one of the make or break issues, for their support of the…

Who was the group?

The key people doing the lobbying were essentially, in terms of organisations, The Writers Guild, SPAR, ASTA and The Alliance.


In terms of working most closely together it was Meagan Elliot and Richard Harris and Geoff Brown. The Alliance tended to try and run their own race, and they in my mind actually were responsible for some of the blunders in the campaign like getting the actors to make all those statements in the AFR Awards, which…

Really aren’t helpful to anyone.

Which, you know, led to the other people having to hose it down and you know and because they had politicians saying to them, what’s all this about, I thought you understood what our position was, blah, blah, blah, blah, you know, so!

And the agencies, the AFC, the Universities and the…?

Yeah, the AFC particularly was very active until the deal was done and they got told to put their head back in the box.

Yeah. They do… to the best of my knowledge, you were the first people to bell the cat on new media. Did the government ever get that… or did they ever really grasp the seriousness of that issue, I think it was too hard to get it through an MTLA or did they simply not grasp it?

Look, I think the officials grasped it, but the… the thing one also has to understand is that the American negotiators are world class.

Oh, yes.

That’s the… and the way that the negotiators… the US Trade Representative has advising him about 700 people on various committees, there are about 24 different committees of industry sectors of various levels, who are all professionals in those industries, who are there to look at what, you know, so they…

The trade issues.

The trade issues, they get to see what the negotiators are going into any negotiation with, and it comes down to things like, when the team was in Washington, at the negotiating table that anyone of those people could go in on secure access to the US Trade Representative’s website and get the very latest on what was happening in the negotiating room and provide advice, etc, which just simply wasn’t available to anyone in Australia, not just to the cultural industry but to even the biggest players in the land.

That was a hugely sophisticated!

Hugely sophisticated operation, and my strong belief is that, last February the negotiators should have got up from the table and come home, and not said, you know, this is the end, but said, we need to think and regroup and get advice, not just from our political masters but also from the industry groups here.

We’re aren’t advised.

Yeah. But instead it was left to John Howard and George Bush to have the conversation, and they were always going to be saying, let’s do the deal, because they were looking at the politics of it, which is, you know everyone knew that unless Congress got to look at it before the middle of last year there was no prospect of the deal being done until after the presidential election, and…

Nobody was expecting the result that they got from the American election?

No. No.

In… in that [xxxxx] of the last question, which is when you rule the world, what would you do is the answer, is part of the answer to that you would ensure that that debate took place?

Yeah part of that goes through that, and…

What else?

Well, I think it also needs to be not just a debate, but something out of which something concrete happens. I think that we need to seriously look at, well as I said before, have a serious and coordinated look at what we want the broadcasting system to do. Who does that, is it done by the department? Do we have some sort of sparring committee to do it, or we’re talking about creating a new regulator from the merging of the ABA and the ACA, and I think one of the problems with that is that again is evidence of the government failing to grasp the opportunity, because they’re saying, oh the reason we’re doing it is because there is a convergence and it’s a convergence and their issues that need to be grappled with, but they are not actually saying, we’re going to do it. All they’re doing simply is putting the two organisations together and not giving them any remit to do that work and you know, you can predict… I mean also at the regulatory level, a lot is going to depend on who gets appointed.


To that. And I think you can predict that with the prospect of the sale of Telstra, they are going to want to appoint as the head of that organisation someone who has got a fair degree of commercial savvy. Someone who has got business and economic, and then they’re going to have to appoint people who have got the technological background to deal with the technical issues. And my fear would be that the people who are interested in content and culture, they end up being you know part-time members, and that area of the authorities’ activity, I mean I think content regulation will continue to go on.


But that kind of other thinking about…

The overarching.

Yeah, the overarching, you know, not just now being converged to mouthing that there are challenges, but actually saying, look, what are the challenges? How do they particularly impact on our industry?

And driving through…

And driving through them and coming up with ways and strategies in which the country can deal with it.

What’s your experience of the FTA, such as to suggest that in the absence of, which I don’t mean maliciously either, but in the absence of a government wishing to do that and that does appear to be so, this happened to other governments but this government doesn’t appear to wish to have that kind of very full and holistic debate, is it your experience of the FTA that you can get that debate to happen anywhere?

I think it’s possible but it needs a lot concerted effort and you know, and an agreement on the strategy amongst the groups of people that have… you know, not in the past, not in any… you know and I’m not saying this is any malicious sense, but in the past not have… yeah, much evidence of doing this because the reality is, is that it’s not that these people can‘t see the need for it but I know from my own experience of running a industry organiser representative organisation that you have got to be able to carry your membership with you. Now with the Free Trade Agreement, I mean that was relatively easy and everyone said, no, it’s bad. But it had got to that level of awareness in the membership through, what, over a decade of talking and…

Bashing it around.

Bashing it around and getting people to think a bit more about… more than their immediate business concerns, I mean – and I think that’s the problem is that… for those organisations is that their membership is divided, it does tend to think short-term, it does… they do tend to think about how can I use this organisation to benefit my commercial outcome?

This week.

This week.

Yeah. Which is exactly why this is set out for ten years out. To give people at least the opportunity to step back and think about that [xxxxx]. Thank you very much.

That’s okay.