Australia can learn from Indonesia’s experience before relaxing its media laws

Indonesian media moguls have argued that the internet means cross-media ownership laws that prevent common ownership of radio, television and newspapers are obsolete. shutterstock

Indonesia’s media landscape may be a model Australia is emulating as it prepares to change its media ownership laws. There are positives to following Indonesia’s lead, but also reasons for Australians to be concerned.

Indonesia’s private media companies have evolved rapidly in the digital era. This is partly because Indonesia has largely abandoned major restrictions on media ownership. This has meant companies have been free to merge, create new platforms and build larger media conglomerates.

Indonesian media moguls have argued that the internet has made obsolete the cross-media ownership laws that prevent common ownership of radio, television and newspapers. Eric Thohir, an Indonesian media mogul with stakes in two TV stations, numerous newspapers and magazines, two radio stations and an online news portal, once told me:

I don’t see any point to the cross-media ownership laws. Convergence means they are obsolete laws. Besides, now if you want to start your own YouTube channel, you can. You can create your own media through social media.

Prime Minister Malcolm Turnbull, then Australia’s communications minister, has previously made similar arguments:

… we are a reforming government, a deregulating government. We believe that the flowering of the internet creates the opportunities for less regulation and more freedom.

Digital conglomerates

So what is happening in Indonesia? Since Indonesia’s media laws allow companies to own different media platforms, every major media company started to become a “digital conglomerate” – a multi-platform media company with a centralised newsroom located in Jakarta.

It was no longer adequate for media companies to maintain one platform – for example, a television station, a newspaper or an online site – on its own.

For a digital conglomerate to be created, numerous mergers and acquisitions within the industry needed to occur. As a result, big media became bigger, and medium-sized and smaller media were either bought by larger companies or struggle to survive. This means that Indonesia’s media landscape is becoming increasingly concentrated.

All these digital conglomerates largely look the same. They provide mainstream, national content across multiple platforms. They have two or three entertainment-content television stations, a 24-hour television news channel, an online news service, a few radio stations. Eventually all of their content will be streamed online.

Mergers are likely to happen in Australia if existing laws are changed. There is already speculation this might involve Nine Network and Fairfax, and News Corp and Ten.

Media companies would argue that mergers are essential for them to survive in the digital era. They may also claim that a financially healthy media company is crucial for providing quality news and entertainment.

Mergers would also allow them to compete with the growing threat of international media companies such as Netflix or Facebook, which do not face the same regulatory burdens or infrastructure costs.

Partisan coverage

So there are certain positives in relaxing media ownership laws. But a number of observations from the Indonesian media industry suggest some regulations are necessary.

First, media owners have become wealthier and more politically powerful than they were ten years ago. As a result, media coverage of the 2014 Indonesian elections was far more partisan than in the elections of 2009 and 2004.

There are a number of other reasons for this, but as the media landscape becomes more concentrated, partisan coverage can become all-encompassing.

Australia already has problems with the influence of powerful media owners. This was perhaps best exemplified by the Daily Telegraph’s 2013 election-year front pages “Kick this mob out” and “Australia needs Tony”.

Capital-city-centric

Second, despite hopes local content could be better funded, digital conglomerates are all based in capital cities. They have to be, in order to be cost-efficient. This is likely to be more pronounced in Jakarta or Moscow or London than in Australia, due to the dominance of these capital cities in their respective nations, but the most likely result is centralised “digital newsrooms” in Sydney and Melbourne.

Indonesia’s media companies have shown little interest in producing news from remote areas of Papua, Ambon or Aceh. It is just as unlikely Australia’s large media companies will be investing heavily in news content from the Northern Territory, Tasmania or Western Australia.

Third, Indonesia’s media moguls have also argued for a weaker public broadcaster.

Of all media companies in Australia, the ABC currently has a similar business model to Indonesia’s large digital conglomerates. This means the national broadcaster becomes even more of a direct competitor as a news provider via digital media platforms.

Moguls such as Rupert Murdoch are likely to argue that taxpayer dollars could be put to better use. Think of the previous debate about Sky’s Australia Channel versus the ABC’s Australia Network, but on a far grander scale.

Differences

There are some important differences between Australia and Indonesia. Indonesia’s multi-party system means media owners can and do directly run for political positions, even for president.

Furthermore, Australia has a respected public broadcaster. Indonesia’s is seen as subservient to government, given its former life producing propaganda in the Suharto-era.

In Indonesia, as media companies become more politically aligned and as officials in rural areas cry out for better news coverage, citizens are now making belated calls for stronger media ownership laws.

Some changes to Australia’s media laws are necessary and multi-platform conglomerates are probably inevitable. What Indonesia’s experience tells us is that the media mogul remains a powerful force in the digital era, despite the variety of content made available by the internet. Any change to existing laws should take into account this state of affairs.