*contains graphic material

Now that media regulation is firmly on the agenda in Australia I feel like it’s suddenly Opposite Day. Normally the internet is full of people declaiming the impotence, irrelevance and imminent death of the dead tree medium. Suddenly the story is about the ‘excessive power’ of newspapers, their formidable ‘influence’ and the way they ‘set the agenda’. And the fewer people that read the newspaper (as with The Australian, the seventh most-read newspaper in Australia, read by 2% of the population) the more powerful it seems to be. I’m starting to think the Ad Sales Directors at News Ltd should pay a commission to some commentators, so effectively have they evangelised their product.

In this bizarro world you could easily be forgiven for thinking the media inquiry means that politicians and newspapers don’t like each other. This seems odd considering how closely they confer, trade information, openly collaborate for mutual benefit, exchange personnel, and otherwise utterly rely on each other for their day-to-day operation. Now that the terms of the media inquiry are here and all the main players have had their say, it’s a good time to parse some of the public statements for their true meaning.

According to Senator Stephen Conroy:

The fact is, news gathering and quality journalism costs serious money. And the business models that have provided that money in the past are under threat. The inquiry will be asked to assess the effectiveness of the current media codes of practice in Australia – particularly in light of technological change – the impact of this change on the business model that has supported investment in journalism … and ways to enhance media diversity in the digital era.

For Malcolm Turnbull, who found little merit in the proposed inquiry but did say:

I’m particularly interested — and I’m sure everyone in the media is – at finding out what is the answer to making newspapers profitable again. [...] As Thomas Jefferson said hundreds of years ago and I agree with him “Government functions best with a strong and independent press, but if given the choice of no Government or no newspapers, I’d rather have no Government.” 

According to John Hartigan, News Ltd CEO:

Quality journalism is a fundamental requirement of a well-functioning democracy and there is a public interest that Australia has a vibrant, independent and healthy media industry.

The terms of reference for the inquiry – strengthening the Press Council, the effectiveness of codes of practice – are all couched within the broader question of newspaper profitability. Any discussion of divestment has been ruled off the table, which is a good thing. Divestment of News Ltd’s properties was always a non-starter, and the fact that the Greens continually mention this is testament to their own naivety. Many newspapers in Australia are marginal concerns – Fairfax recently posted a $390m loss, while The Australian is widely believed to be loss-making and sustained only by cross-subsidy with the more profitable Herald Sun and Daily Telegraph.

Who’d buy the Herald Sun anyway? No less than Warren Buffett has said of investing in American newspapers “we would not buy them at any price … they have the possibility of going to just unending losses.” Therefore the new owner would have to be someone with an agenda other than profit, or an agenda of pure profit at expense of all else. Gina Rinehart, anyone? Google? A Russian ‘businessman’?  Most likely it’d be a slash-and-burn private equity group. Inconceivable as it may seem to Bob Brown, there’s an excellent chance that Rupert Murdoch is already the most ‘fit and proper’ potential owner of his newspapers.

So with that messy matter dealt with, doubtless the first order of business in the inquiry will be furious agreement on the point that QUALITY JOURNALISM (i.e. what newspapers do) is VERY IMPORTANT for a functioning democracy and that (newspaper) journalism must be PROTECTED AND PRESERVED at all costs. The fact is, despite being initially seen as an instrument for bashing News Ltd, the inquiry is likely to work in their favour. Not that you’ll know it from the inevitable whinging from the opinion writers of The Australian.

Most likely, the next order of business will be around strengthening regulatory mechanisms to act on complaints. As others have pointed out, the Press Council already appears to have proposed a new statutory body with new powers to cover all media. According to Jonathan Holmes, the new authority would “have the power, in serious cases, to insist on the production of evidence by media, and to levy fines or other sanctions.”

But any new move to strengthen regulations around privacy, public interest, or accuracy, will also strengthen established media companies. If the potential to penalise is introduced, News Ltd and Fairfax will complain loudest and longest about this. However, News Ltd generates the kind of profits that means they can afford to deal with any penalties – it will simply become a cost of doing business, albeit one which they scarcely need.

For a more marginal group – say, an online outfit like Crikey or New Matilda – new risks and barriers could put them out of business entirely. News Ltd and Fairfax can afford in-house legal counsel and law firms on retainer – a website employing 10 staff and operating out of a 3-room headquarters cannot. At the moment there is no complaint mechanism for online media, but that’s what Conroy has alluded to. It’s inconceivable and unfair that any such authority would cover a Fairfax website but not an online-only operation like Crikey.

Increasing the potential liability for acts of journalism will reduce, rather than bolster sorely-needed competition in the news business. There will be clear winners and losers: News Limited will win, since they will have less competition; politicians will win because they will be able to complain about coverage, accuracy, privacy etc. Everyone else, including smaller media companies and news consumers, will lose.

As a matter of urgency the inquiry ought to take a platform-neutral view of journalism. Journalism is not something that occurs solely in newspapers, nor is it something performed solely by full-time professionals. The inquiry ought to take as broad a view as possible of ‘acts of journalism’ as incorporating user-generated online platforms, and then consider what a desirable – and feasible-  level of regulation might be, if any. That’s if they want to foster competition, rather than simply help prop up News Ltd and Fairfax’s struggling businesses.

The one thing that needs to be addressed in the Australian media landscape is diversity. The oft-repeated but little-understood figure about Murdoch’s ’70% share of news’ does signify something – too much of the news consumed in Australia comes from just two sources: Murdoch and the ABC.  Finding a way to introduce the controls and complaint mechanisms that the community wants, while also – crucially – fostering competition, ought to be the central concern of the inquiry.  But at this point it seems just as likely that the mutual interests of politicians and established media companies will converge on the former at the expense of the latter.