tag:theconversation.com,2011:/global/topics/foxtel-2957/articlesFoxtel – The Conversation2021-02-18T19:12:49Ztag:theconversation.com,2011:article/1546402021-02-18T19:12:49Z2021-02-18T19:12:49ZRegardless of the rules, sport is fleeing free TV for pay, and it might be an avalanche<figure><img src="https://images.theconversation.com/files/384117/original/file-20210214-13-1becssh.jpg?ixlib=rb-1.1.0&rect=916%2C275%2C2642%2C1467&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">The Conversation</span>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span></figcaption></figure><p>Netball Australia has signed a five-year deal it describes as “<a href="https://supernetball.com.au/news/new-broadcast-and-rights-deal-announced-2022">ground-breaking</a>”. </p>
<p>Every game of every round of each year’s Super Netball competition will be broadcast live and ad-free on Foxtel platforms including its sports streaming app Kayo Sports.</p>
<p>For viewers who don’t want to part with cash, two games each week will be available live and free on <a href="https://help.kayosports.com.au/s/article/Freebies-All-you-need-to-know">Kayo Freebies</a>, although viewers will have to hand over their email and other details.</p>
<p>That several events will be free is good for Netball Australia — it gives it potential access to the mass audience it would have had on free-to-air TV – and also good for Foxtel because it will pioneer a way of getting around the <a href="https://www.legislation.gov.au/Details/F2017C00987">anti-siphoning</a> rules that are meant to ensure major events can be watched by everyone.</p>
<p>Rugby Union is doing something similar. </p>
<p>From tonight every match will be shown live on <a href="https://www.stan.com.au/sport">Stan Sport</a>, part of the movie streaming platform Stan owned by Nine, under a three-year deal worth a reported <a href="https://www.abc.net.au/news/2020-11-09/rugby-australia-rights-deal-online-streaming-stan-nine/12863176">A$100 million</a>. </p>
<p>Enough matches will be shown free on the Nine network to satisfy the anti-siphoning rules.</p>
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Read more:
<a href="https://theconversation.com/the-tv-networks-holding-back-the-future-155220">The TV networks holding back the future</a>
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<p>The Rugby deal replaces an earlier one with Foxtel, which used the Ten network to broadcast free matches.</p>
<p>Cricket is now broadcast on both <a href="https://www.foxtel.com.au/watch/cricket.html/">Foxtel</a> and the Seven Network, a deal Seven is reportedly <a href="https://www.smh.com.au/sport/cricket/seven-moves-towards-terminating-450-million-cricket-australia-deal-20200911-p55unt.html">trying to get out of</a>. It means fans must now subscribe to watch domestic men’s One Day Internationals for the first time.</p>
<h2>Anti-siphoning antiquated</h2>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=1185&fit=crop&dpr=1 600w, https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=1185&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=1185&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1489&fit=crop&dpr=1 754w, https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1489&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/384919/original/file-20210218-19-1nxo42x.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1489&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="attribution"><a class="source" href="https://www.legislation.gov.au/Details/F2017C00987/">Broadcast Service Events Notice</a></span>
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<p>Australia’s anti-siphoning laws were enacted with the <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp0910/10rp14">birth of pay TV</a> thirty years ago in order to ensure all Australians retained access to “<a href="https://theconversation.com/anti-siphoning-changes-a-blow-to-sports-fans-who-want-to-watch-on-free-to-air-tv-78666">culturally significant</a>” sports and events.</p>
<p>So-called “<a href="https://www.legislation.gov.au/Details/F2017C00987/">broadcast events notices</a>” specify events that, in the opinion of the minister, “should be available free to the general public”.</p>
<p>Among those currently on the list are every event at the Summer and Winter Olympic games, the Melbourne Cup, every match in the AFL and AFL premiership competitions, and each cricket test played in Australia or overseas by a representative team chosen by Cricket Australia.</p>
<p>The rules don’t compel free-to-air networks to broadcast these events, but they do require them to be given first dibs.</p>
<p>While broadly successful in securing sporting events for free-to-air television and the viewing public, the rules are becoming <a href="https://www.smh.com.au/business/companies/anti-siphoning-laws-need-to-be-examined-after-cricket-deal-labor-20190505-p51k64.html">battle weary</a>. </p>
<h2>‘Freemium’ not tested</h2>
<p>Netflix, Amazon, Twitter, Facebook, Stan, Kayo, Telstra and the smartphone didn’t exist when the rules were drawn up.</p>
<p>The rules as written appear to allow Kayo to pursue a Spotify and YouTube-style “freemium” strategy while fulfilling the requirements of the legislation.</p>
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Read more:
<a href="https://theconversation.com/fight-over-live-streamed-sport-to-go-on-after-final-bell-sounds-72494">Fight over live-streamed sport to go on after final bell sounds</a>
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<p>As worded, the law refers to events “available free to the general public” rather than events available on free-to-air TV.</p>
<p>Kayo is opening the way for Fox Sports and others to meet the formal requirements of the anti-siphoning laws while raiding sports until now housed on free-to-air TV, the AFL and Rugby League among them.</p>
<h2>Netball the canary in the coalmine</h2>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=970&fit=crop&dpr=1 600w, https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=970&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=970&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1219&fit=crop&dpr=1 754w, https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1219&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/384937/original/file-20210218-21-ojg8t2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1219&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Liz Watson of the Vixens and coach Simone McKinnis celebrate victory during the Super Netball Grand Final.</span>
<span class="attribution"><span class="source">ALBERT PEREZ/AAP</span></span>
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<p>A key question will be whether access via an app is really “free”. Surrendering email addresses and demographical information in return for watching isn’t quite the same as free. Facebook and Google have made it more than clear that such data is <a href="https://thenewdaily.com.au/life/tech/2020/12/16/facebook-accc-vpn-data/">valuable</a>.</p>
<p>The stakes are high for sport leagues, media outlets and fans.</p>
<p>It has been <a href="https://books.google.com.au/books/about/The_Economics_of_Sports_Broadcasting.html?id=YGSVlol_hgsC">argued</a> that even in the hypothetical absence of an anti-siphoning list, most sports would be well served to choose a free-to-air broadcast partner to maximise their exposure and popularity.</p>
<p><a href="https://www.tandfonline.com/doi/full/10.1080/17430437.2020.1773433">Super Rugby</a>’s 25-year decline behind a Foxtel paywall is used as a cautionary tale.</p>
<p>Sport accounts for about only 10% of commercial television air time, yet rates <a href="https://www.freetv.com.au/wp-content/uploads/2020/07/Free-TV-Industry-Report-Everybody-Gets-It-20-July-2020.pdf">consistently highly</a>. Sport, news and reality television account for all of free to air’s top twenty programs. </p>
<p>Free-to-air’s share of the advertising market is at present predicted to decline from 20% in 2018 to <a href="https://www.pwc.com.au/industry/entertainment-and-media-trends-analysis/outlook.html">14%</a> in 2023. </p>
<p>The loss of sport could send it into an even faster nosedive.</p><img src="https://counter.theconversation.com/content/154640/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Hunter Fujak does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Pay TV appears to have found a way around the rules meant to ensure sport stays on free-to-air TV.Hunter Fujak, Lecturer in Sport Management, Deakin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1467592020-09-23T07:50:38Z2020-09-23T07:50:38ZIs fast-tracking funds to Foxtel the best way to support the media during COVID?<figure><img src="https://images.theconversation.com/files/359508/original/file-20200923-16-k6glr0.jpg?ixlib=rb-1.1.0&rect=636%2C49%2C2974%2C1999&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>According to an ABC report, government funds were <a href="https://www.abc.net.au/news/2020-09-23/foxtel-benefited-from-fast-tracked-federal-government-funds/12690954">fast-tracked to Foxtel</a> during the coronavirus pandemic. </p>
<p>This news will raise eyebrows, as the media — like so many industries — tries to survive the <a href="https://www.theguardian.com/media/2020/apr/14/dozens-of-australian-newspapers-stop-printing-as-coronavirus-crisis-hits-advertising">pain and disruption</a> brought by COVID-19. </p>
<p>Why are some outlets missing out when others have their requests prioritised? </p>
<h2>The Foxtel fast-track</h2>
<p>The background to these latest Foxtel funds is a <a href="https://www.theguardian.com/australia-news/2017/jul/19/government-declines-to-explain-foxtels-30m-handout-for-sports-broadcasting">$30 million grant</a>, controversially awarded to the subscription broadcaster in 2017. </p>
<p>This was to</p>
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<p>support the broadcast of underrepresented sports on subscription television, including women’s sports, niche sports and sports with a high level of community involvement and participation.</p>
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<p>At the time, <a href="https://www.theguardian.com/australia-news/2017/jul/19/government-declines-to-explain-foxtels-30m-handout-for-sports-broadcasting">media reports noted</a> the government did not adequately explain why it had given the funds to Foxtel. </p>
<p>Fast-forward to April 2020 and COVID-19 was <a href="https://www.afr.com/companies/media-and-marketing/content-quotas-spectrum-fees-waived-for-2020-20200415-p54jxh">wreaking havoc</a> in the media sector. The federal government announced a <a href="https://www.paulfletcher.com.au/media-releases/media-relase-immediate-covid-19-relief-for-australian-media-as-harmonisation-reform">support package</a> for the media, but Foxtel missed out. </p>
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Read more:
<a href="https://theconversation.com/that-was-the-news-a-sad-farewell-to-the-abcs-7-45am-bulletin-146478">That was the news: a sad farewell to the ABC's 7:45am bulletin</a>
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<p>However, as the ABC reported, after a letter from Foxtel chief executive Patrick Delany, the TV service quickly received $17.5 million. </p>
<p>This included bringing forward $7.5 million of taxpayer money already granted to Foxtel. In July 2020, a <a href="https://www.theguardian.com/australia-news/2020/jul/22/coalition-gives-another-10m-to-foxtel-to-boost-womens-sport-on-tv">further $10 million</a> was awarded to Foxtel, with the same opaque justification as the 2017 grant. </p>
<p>The ABC was able to report the process behind these developments following a Freedom of Information (FOI) request.</p>
<h2>Foxtel supported as national broadcaster struggles</h2>
<p>The Foxtel funds came amid yet another round of cost-cutting and job losses at the ABC. In June, the ABC announced <a href="https://theconversation.com/latest-84-million-cuts-rip-the-heart-out-of-the-abc-and-our-democracy-141355">250 job losses</a> to deal with an $84 million budget shortfall. </p>
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<img alt="ABC logo against colourful light backdrop" src="https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=444&fit=crop&dpr=1 600w, https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=444&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=444&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=557&fit=crop&dpr=1 754w, https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=557&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/359510/original/file-20200923-24-1cvpcrx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=557&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">The ABC recently announced 250 job losses.</span>
<span class="attribution"><span class="source">www.shutterstock.com</span></span>
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<p>As of this week, the iconic <a href="https://theconversation.com/that-was-the-news-a-sad-farewell-to-the-abcs-7-45am-bulletin-146478">7:45am radio bulletin</a> no longer features in Australians’ morning routines as a result of the cuts. </p>
<p>Meanwhile, regional media outlets have been <a href="https://theconversation.com/the-governments-regional-media-bailout-doesnt-go-far-enough-here-are-reforms-we-really-need-144666">particularly hard hit</a> during COVID. We have also seen recent job losses at <a href="https://www.abc.net.au/news/2020-05-28/news-corp-to-cut-jobs-in-restructure-towards-digital-newspapers/12294970">News Corp</a> (who is a part owner of Foxtel) and <a href="https://www.abc.net.au/news/2020-08-11/network-10-announce-staff-cuts-news-bulletin-changes/12546122">Channel 10</a>. </p>
<h2>What support have media companies had during COVID?</h2>
<p>The government announced a COVID-support package <a href="https://www.paulfletcher.com.au/media-releases/media-relase-immediate-covid-19-relief-for-australian-media-as-harmonisation-reform">for the media</a> in April. </p>
<p>This included $41 million in rebates for use of the broadcasting spectrum, targeted at commercial television and radio broadcasters. </p>
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Read more:
<a href="https://theconversation.com/the-governments-regional-media-bailout-doesnt-go-far-enough-here-are-reforms-we-really-need-144666">The government's regional media bailout doesn't go far enough — here are reforms we really need</a>
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<p>A $50 million <a href="https://www.communications.gov.au/what-we-do/television/relief-australian-media-during-covid-19">Public Interest News Gathering program</a> was also announced to support public interest journalism delivered by commercial television, newspaper and radio businesses in regional Australia.</p>
<h2>Is this the best use of taxpayer funds?</h2>
<p>The reports of the fast-tracked funds to Foxtel beg the question, where is public money best spent? On the public broadcaster so it can maintain its crucial services (with another bushfire season around the corner) — or on a subscription-based commercial broadcaster?</p>
<p>When you consider the <a href="https://theconversation.com/whatll-happen-when-the-moneys-snatched-back-our-looming-coronavirus-support-cliff-138527">different support packages</a> the Morrison government has launched as part of its pandemic response, there is one glaring omission — support for the national broadcaster. </p>
<p>The ABC is the <a href="https://theconversation.com/cutting-the-abc-cuts-public-trust-a-cost-no-democracy-can-afford-140438">most trusted media brand</a> in the country. But instead of supporting it, to help us get through the pandemic, the Coalition continues to bleed it. This is the polar opposite to its support of News Corp-owned Foxtel, <a href="https://theconversation.com/whether-a-ratings-chase-or-ideological-war-news-corps-coronavirus-coverage-is-dangerous-143003">a relationship</a> the government seems much more comfortable with and clearly prioritises.</p>
<h2>Not enough information</h2>
<p>When considering whether Foxtel deserves its funding, it would be useful to see a government-issued summary of how it used the first $30 million. </p>
<p>We have seen <a href="https://www.smh.com.au/entertainment/tv-and-radio/how-foxtel-is-spending-its-30-million-government-handout-20180907-p502fy.html">some reporting</a> (again via FOI requests) of how the initial $7 million was used to boost sports coverage. But given this is taxpayers’ money, best practice would be open and transparent government reporting on how the funding is utilised.</p>
<p>It would also be useful to have an explanation of why the extra funds were provided now. </p>
<p>Unfortunately, information access and openness has not been the Morrison government’s forte. </p>
<p>We have seen a <a href="https://www.theguardian.com/australia-news/2019/jan/02/how-a-flawed-freedom-of-information-regime-keeps-australians-in-the-dark">number of cases</a> where the FOI process has been contrary to the spirit of the <a href="https://www.oaic.gov.au/freedom-of-information/the-foi-act/">Freedom of Information Act</a>, which holds that as much information as possible should be made available to the public. </p>
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<img alt="Open filing cabinet, with paper files" src="https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/359513/original/file-20200923-16-1bc25dr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">The Australian government has been criticised for the high rate of FOI refusals.</span>
<span class="attribution"><span class="source">www.shutterstock.com</span></span>
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<p>The <a href="https://www.theguardian.com/australia-news/2019/nov/26/government-blocks-access-to-emails-about-angus-taylors-attack-on-clover-moore">blocking of FOI requests</a> over Energy Minister Angus Taylor’s attack on <a href="https://www.theguardian.com/australia-news/2019/oct/23/doctored-documents-angus-taylor-news-corp-climate-clover-moore">Sydney Lord Mayor Clover Moore</a> is one recent example. </p>
<p>The recent requests to the Morrison government about Foxtel is another. According <a href="https://www.abc.net.au/news/2020-09-23/foxtel-benefited-from-fast-tracked-federal-government-funds/12690954">to the ABC</a>, more than half of the hundreds of pages released were blacked out and 80% of the rest had substantial redactions. Communications Minister Paul Fletcher’s chief of staff, Ryan Bloxsom, was one of the FOI decision makers and justified the extensive redactions in this way:</p>
<blockquote>
<p>I do not consider it would inform debate on a matter of public importance or promote effective oversight of public expenditure.</p>
</blockquote>
<p>This is not just out of line with the aims of the FOI Act, it means Australians remain ill-informed about how and why tax payer money is being spent. Our public discourse is worse of for it. </p>
<p>This makes funding public interest journalism even more important — especially in the regions where coverage of courts and local councils is the engine room of our democracy.</p>
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<p>
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<strong>
Read more:
<a href="https://theconversation.com/funding-public-interest-journalism-requires-creative-solutions-a-tax-rebate-for-news-media-could-work-146563">Funding public interest journalism requires creative solutions. A tax rebate for news media could work</a>
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<img src="https://counter.theconversation.com/content/146759/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Johan Lidberg does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The news Foxtel received a speedy funding boost as the ABC faces another round of damaging cost cuts will raise eyebrows. And questions about how we spend taxpayers’ money.Johan Lidberg, Associate Professor, School of Media, Film and Journalism, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1013112018-08-19T19:49:58Z2018-08-19T19:49:58ZCan Australian streaming survive a fresh onslaught from overseas?<figure><img src="https://images.theconversation.com/files/231410/original/file-20180810-30443-122o9fc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">shutterstock</span> </figcaption></figure><p>Australia’s already punch-drunk streaming sector is set for even more upheaval, as CBS <a href="https://www.theage.com.au/entertainment/tv-and-radio/cbs-confirms-australian-streaming-platform-to-launch-by-end-of-2018-20180806-p4zvpf.html">will launch</a> its streaming service in Australia as early as October. </p>
<p>Disney is also <a href="https://www.thewaltdisneycompany.com/walt-disney-company-acquire-majority-ownership-bamtech/">set to launch its streaming service in 2019</a>. Based on recent history, Australia will likely be first up when it goes global.</p>
<p>The question is whether Australian streamers can compete locally with the global mammoths. Doing so might require coordination the likes of which we haven’t seen before.</p>
<p>This will impact not just what media Australians have access to, but <a href="https://www.screenaustralia.gov.au/sa/media-centre/news/2017/06-15-abs-survey-results">more than 31,000 people</a> employed by Australian media.</p>
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<a href="https://theconversation.com/netflix-arrival-will-be-a-tipping-point-for-tv-in-australia-38386">Netflix arrival will be a tipping point for TV in Australia</a>
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<p>We have already seen huge upheavals in Australian streaming.</p>
<p>Stan is the last remaining Australian streaming service from 2015, <a href="https://theconversation.com/netflix-arrival-will-be-a-tipping-point-for-tv-in-australia-38386">when I wrote about the official launch of Netflix in Australia</a>. At that time there were two Australian-based subscription video-on-demand (SVoD) services, Presto and Stan. </p>
<p>Presto, a joint venture between Seven and Foxtel, was shut down in early 2017. </p>
<p>Foxtel then launched <a href="https://www.foxtel.com.au/now/index.html">FoxtelNow</a> in June 2017. It is already set for an <a href="https://www.channelnews.com.au/foxtel-now-dead-new-4k-uhd-service-coming-cricket-launch/">overhaul</a> later this year, to include 4K streaming, along with sports and entertainment streaming packages. </p>
<h2>Aussie streaming services, more than just subscription</h2>
<p>In addition to Stan, there are also transactional video-on-demand (TVoD) services in Australia, although these are discussed far less. A TVoD service is based upon a single payment being made to view singular content for a limited time, e.g. you have streaming access to the latest release for 48 hours. </p>
<p>One such Australian service is <a href="https://www.quickflix.com.au">Quickflix</a>, which launched in 2014. It went <a href="https://theconversation.com/buyouts-mean-the-future-of-australian-video-on-demand-is-hard-to-picture-66683">into receivership</a> in 2016, before being saved and later relaunched. </p>
<p>Quickflix is still a streaming company, but retains the older <a href="https://www.quickflix.com.au/Join">disc mail-out service</a>. This mail-out service could help Quickflix survive against global streaming services. </p>
<p>With the <a href="https://www.smartcompany.com.au/technology/australias-video-shop-association-set-close-can-streaming-keep-demand-high-quality-video/">closure</a> of video stores and retail stores <a href="https://thenewdaily.com.au/money/consumer/2018/06/28/kmart-australia-dvds-cds/">removing discs</a> from their shelves, a mail-out service still has value for Australians with poor internet speed and access.</p>
<p>The other Australian TVoD service is <a href="https://www.ozflix.tv/">OzFlix</a>, which some Australians may not be aware of. </p>
<p>Its differentiation is plans to source “<a href="https://www.ozflix.tv/#!/page/412/about-us">Every Aussie Movie. Ever.</a>”. A big task, but its specific niche may help it survive the onslaught of global media streaming services, while also giving <a href="https://theconversation.com/with-the-rise-of-subscription-and-online-tv-we-need-to-rethink-local-content-rules-79496">local content</a> a dedicated home. </p>
<h2>Global media giants set their sights on Australia</h2>
<p>Australia has been the first country that many media companies expand to when moving outside their own region. <a href="https://theconversation.com/netflix-arrival-will-be-a-tipping-point-for-tv-in-australia-38386">Netflix</a> and <a href="https://theconversation.com/youtube-red-is-here-and-it-breaks-the-video-on-demand-mould-59656">YouTube Red</a> (now YouTube Premium) are two examples. </p>
<p>More recently we have seen <a href="https://theconversation.com/amazons-new-grand-tour-series-could-be-the-next-illegal-download-victim-68141">Amazon Prime Video</a> launch in late 2016, although it is yet to have a major uptake locally. </p>
<p>The arrival of CBS All Access will impact Stan particularly. Stan features a number of CBS programs, so future programming will need to be from other distributors or through greater investment in original content. </p>
<p>Disney is also set to <a href="https://www.channelnews.com.au/foxtel-netflix-set-to-face-off-with-new-disney-streaming-service/">acquire</a> 21st Century Fox. This will expand its catalogue on the new streaming service beyond its already huge catalogue. The Marvel movies look set to remain on current services, for now.</p>
<h2>Australians and streaming…. what next?</h2>
<p>A recent <a href="http://www.roymorgan.com/findings/7681-netflix-stan-foxtel-fetch-youtube-amazon-pay-tv-june-2018-201808020452">Roy Morgan report</a> found over 9.8 million Australians had access to Netflix, with Stan at over 2 million. While Stan is clearly behind, it has had a 39.2% increase in the last 12 months. </p>
<p>YouTube premium has over 1 million subscribers, FetchTV 710,000 and Amazon Prime Video last at 273,000 (an 87% increase year on year).</p>
<p>The arrival of CBS All Access and Disney will make an already crowded market only more so. But is more choice a good thing? </p>
<p>A 2014 <a href="http://www.nielsen.com/us/en/insights/news/2014/changing-channels-americans-view-just-17-channels-despite-record-number-to-choose-from.html">Nielsen report</a> showed the average channels receivable by US households grew from 129 in 2008 to 189 in 2013. But the average channels tuned in remained at 17.</p>
<p>On top of larger content libraries, the global players also have deeper pockets. Disney looks <a href="https://www.tubefilter.com/2018/08/14/star-wars-live-action-series-will-cost-100-million-be-streamed-exclusively-on-disneys-platform/">set to spend</a> US$100 million on a new Star Wars series for its streaming service. Netflix will <a href="https://variety.com/2018/digital/news/netflix-original-spending-85-percent-1202809623/">spend</a> more than US$8 billion on content in 2018 alone, and Amazon last year spent US$4 billion on content. </p>
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<a href="https://theconversation.com/with-the-rise-of-subscription-and-online-tv-we-need-to-rethink-local-content-rules-79496">With the rise of subscription and online TV, we need to rethink local content rules</a>
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<p>Australian services will need to have a point of difference. Quickflix and OzFlix have their points of difference, but what about a larger service like Stan? </p>
<p>Stan can’t compete with the global companies on quantity of content, so it must, like others, have a point of difference. </p>
<p>Stan could become a premium platform for content of which some is broadcast on Nine later. That would be a similar approach to when Australian FTA broadcasters would buy US content months after it was broadcast in the US – to save on costs.</p>
<p>For an Australian service to compete, a better solution would be a combined approach, an all-Australian streaming service that combines the strengths and finances of the Australian media industry. </p>
<p>The <a href="http://www.freeview.com.au/freeviewfv/">Freeview app</a> is an example of how Australian television has tried to work collaboratively but failed. The users can view all the catch-up content from Australian broadcasters, but to view it they are taken from the app to the specific broadcasters’ own catch-up apps. </p>
<p>This requires six apps in total to be installed to view all catch-up content.</p>
<p>But is the Australian media industry willing to come together to fight against global streaming media companies, or will they continue to battle each other? Failure here could result in a further decline in Australian media.</p><img src="https://counter.theconversation.com/content/101311/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>Is the Australian media industry willing to come together to fight against global streaming media companies, or will Australian media continue to battle each other?Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/952962018-04-29T20:13:47Z2018-04-29T20:13:47ZIn the debate about Australian content on TV, we need to look further than the ABC<figure><img src="https://images.theconversation.com/files/216065/original/file-20180424-94115-kt9y37.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Sean Keenan in Australian sci-fi drama Glitch. The show's second season was a co-production between ABC TV and Netflix.</span> <span class="attribution"><a class="source" href="https://www.imdb.com/title/tt4192782/companycredits?ref_=tt_dt_co">ABC TV/IMDB</a></span></figcaption></figure><p>One of the main functions of the media is to tell a society’s collective story, both to the society itself and to others.</p>
<p>People instinctively grasp the importance of this, and an established way of assessing how well a society does it is to quantify the local content appearing in its media, especially on television.</p>
<p>In Australia, this issue is always lying just under the surface of public debate, and occasionally breaks through to open controversy. It usually takes the form of an argument about how much local content, especially drama, is shown on ABC TV.</p>
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<a href="https://theconversation.com/missing-in-action-the-abc-and-australias-screen-culture-76797">Missing in action: the ABC and Australia’s screen culture</a>
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<p>A controversy like this is happening now, as the Senate Environment and Communications References Committee <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent">inquires</a> into the kind and quantity of Australian content on broadcast, radio and streaming services. </p>
<p>However, the <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent/Submissions">submissions made to the inquiry</a> show that it is misleading nowadays to focus the debate primarily on the performance of ABC TV. </p>
<h2>Going digital</h2>
<p>Digitisation is changing viewer habits radically, and in today’s globalised world there is a significant international component on both the production and distribution sides of the local content industry.</p>
<p>Of course, the ABC remains a very important part of the industry, and its obligation to make and show local content is alluded to in its <a href="http://about.abc.net.au/how-the-abc-is-run/what-guides-us/legislative-framework/">charter</a>.</p>
<p>The charter requires the ABC to broadcast programs that contribute to a sense of national identity; that reflect the cultural diversity of the Australian community, and that tell other countries about Australia and Australian attitudes on world affairs.</p>
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<a href="https://theconversation.com/is-a-quota-the-key-to-getting-netflix-and-co-to-spend-more-on-australian-content-60308">Is a quota the key to getting Netflix and co. to spend more on Australian content?</a>
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<p>So it matters that the ABC’s <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent/Submissions">investment in local content</a> over the past two years has fallen: in documentaries and factual by 55%; in drama by 22% and in narrative comedy by 17%. </p>
<p>At the same time, the free-to-air commercial television networks are <a href="https://www.acma.gov.au/theACMA/communications-report">meeting their quotas</a> of local content, even as their revenue falls under pressure from online platforms, whose advertising revenue is now more than double that of the networks.</p>
<p>In some respects, they are meeting their quotas comfortably, although it should be noted that their “documentaries” include reality TV programs.</p>
<h2>The bigger picture</h2>
<p>There are now significant global factors at work, affecting both the program-making and distribution sides of local content.</p>
<p>On the program-making side, data from <a href="https://www.screenaustralia.gov.au/fact-finders/reports-and-key-issues/reports-and-discussion-papers/drama-report-2016-17">Screen Australia</a>, the federal government’s film-funding agency, show that in 2016/17, the total Australian expenditure on local drama production was $1.28 billion, nearly half of which - $610 million – came from foreign sources. </p>
<p>The $1.28 billion represented a year-on-year increase of more than 50%.</p>
<p>On the distribution side, online streaming has been transformative. Netflix’s <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent/Submissions">submission</a> to the inquiry captures the essence of this:</p>
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<p>The borderless nature of the internet expands opportunities for distribution, pushing Australian content creators to compete with producers from around the world.</p>
<p>This growth was not driven by artificial demand generators such as quotas, funds, or minimum investment requirements. Australian creators are creating high quality content, and succeeding on a global stage.</p>
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<p>This shift in distribution systems presents a challenge to Australian policymakers. Local content rules for the commercial television sector are still based on quotas: the number of broadcast hours devoted to showing local content.</p>
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<a href="https://theconversation.com/with-the-rise-of-subscription-and-online-tv-we-need-to-rethink-local-content-rules-79496">With the rise of subscription and online TV, we need to rethink local content rules</a>
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<p>Streamed services do not count as broadcast, and so the local content quota system does not apply to them.</p>
<p>Therefore, as streaming services become increasingly dominant, the relevance of the existing quota system as a way of assessing how well Australia’s electronic media tell the national story declines.</p>
<h2>Audience habits</h2>
<p>Data from the broadcasting regulator, the Australian Communications and Media Authority (ACMA) on audience viewing habits reinforce the point. They show that the trend away from broadcast and towards streaming services is accelerating, especially among younger people – those aged 18 to 34. </p>
<p>The generational differences are stark.</p>
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<p>Then there is this killer statistic: among all adult age groups, free-to-air television viewing declined from 88.15% in 2010-11 to 80.70% in 2016-17. In round numbers, eight percentage points in six years.</p>
<p>Meanwhile, the ABC and commercial television companies are developing partnerships with big global distributors such as Netflix, to make and export Australian drama content via streaming. Two big-ticket items are <a href="https://www.imdb.com/title/tt4192782/?ref_=fn_al_tt_1">Glitch</a> and <a href="https://www.imdb.com/title/tt7371868/?ref_=nv_sr_1">Pine Gap</a>, both made in a collaboration between Netflix and the ABC. </p>
<p>However, a further challenge for policy-makers is that these global markets are not regulated in the same way as domestic broadcasting. It is an open market, like the market in films, books, magazines and newspapers.</p>
<p>As matters stand, the highly regulated broadcasting system stands separate from streaming. If a commercial licensee is making and showing local content internationally via streaming services like Netflix, why should that not count towards the fulfilment of its local content obligations?</p>
<p>The ABC is already a quite successful player in the streaming market. According to the ABC’s <a href="http://about.abc.net.au/speeches/chief-financial-officer-apm-speech/">chief financial officer</a>, ABC iView remains second only to Netflix as Australia’s most popular video-on-demand service.</p>
<p>However, over the past five years, the ABC’s budget has been cut by <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent/Submissions">$200 million</a>. </p>
<p>Free TV Australia makes the point in its <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/AustralianContent/Submissions">inquiry submission</a> that television is a growing export market. It wants government support to assist local producers to participate.</p>
<p>The same applies to the ABC. If the Federal Government wants the ABC to continue growing in this burgeoning sector, and really values the telling of Australian stories to new global audiences, it might consider expenditure in this area to be an investment in exports, rather than a reluctant handout to a cultural enemy.</p><img src="https://counter.theconversation.com/content/95296/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Denis Muller does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>As streaming services become increasingly dominant, the relevance of the existing local content quota system is declining.Denis Muller, Senior Research Fellow in the Centre for Advancing Journalism, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/949762018-04-13T07:17:48Z2018-04-13T07:17:48ZSeven and Foxtel snag cricket rights, meaning more content but maybe not for free<p>Under a new broadcast rights deal Cricket Australia will part ways with its long broadcast partner, the Nine Network, after more than 40 years. </p>
<p>The A$1.182 billion deal lasts six years and will commence from this coming summer through to 2024. It will be split between Seven and Foxtel. </p>
<p>As part of a new deal, Seven West Media will pay A$75 million per year to <a href="http://www.sevenwestmedia.com.au/assets/pdfs/180413-SWM-Cricket2.pdf">broadcast</a> Big Bash League matches (43 of the 59), all home international tests, including the Ashes (2021-22), some Women’s Big Bash League and International matches, along with award ceremonies including the Allan Border Medal and Belinda Clark Award.</p>
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<a href="https://theconversation.com/are-sport-broadcast-rights-worth-the-money-37460">Are sport broadcast rights worth the money?</a>
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<p>Foxtel will pay A$100 million per year and <a href="https://www.cricketaustralia.com.au/media/media-releases/landmark-cricket-broadcast-partnership-announced/2018-04-13">promises</a> to “show every ball of every over bowled in Australia”, also part of the new deal. </p>
<p>Foxtel will have a dedicated cricket channel. Its coverage will include: simulcasting games from Seven, exclusive rights to men’s one day international and T20 games and 16 Big Bash League matches. </p>
<p>A key for part of the deal for Foxtel has been it securing exclusive digital rights. </p>
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<p>The Nine Network’s partnership with Cricket Australia had a rocky start when the Australian Cricket Board decided to ignore Kerry Packer’s bid in 1976, in favour of the then partner - the ABC. Packer then changed cricket forever with <a href="http://www.espncricinfo.com/worldseries/content/story/72632.html">World Series Cricket</a>. </p>
<p>Today’s new media rights deal is another major shift in Australian cricket history. Not only is it the first time Seven will be involved in cricket, the new deal will also <a href="https://www.cricketaustralia.com.au/media/media-releases/landmark-cricket-broadcast-partnership-announced/2018-04-13">allow</a> Australian cricket fans to have access to more cricket coverage than ever. </p>
<p>While there are more hours, there is a definite shift in what will now be shown on free-to-air television.</p>
<h2>The negotiations</h2>
<p>The <a href="http://www.abc.net.au/news/2013-06-04/grassroots-cricket-to-benefit-from-financial-windfall/4732566">current</a> cricket broadcast rights deal with Nine and Ten is a five year A$590 million deal, ending this year. It was an 118% increase on the previous five-year deal. </p>
<p>Cricket Australia desired a similar increase with its new broadcast rights deal, asking a A$1 billion price tag. While it reached the A$1 billion price tag, the deal is for six years rather than five years. </p>
<p>Despite this, the deal is on par with recent increases in the cost of Australian sports media rights. Cricket Australia’s new rights deal matched the <a href="http://www.abc.net.au/news/2018-04-13/cricket-coverage-shakeup-with-seven-and-foxtel-winning-rights/9652964">percentage increase</a> from the previous deal, (achieved by the AFL) of 67%.</p>
<h2>The winners and losers</h2>
<p>The rights for Foxtel are a massive win, as Foxtel has lacked Australian summer sport content. By gaining the cricket it now has a full-year calendar of Australian sport. Its exclusive digital rights will allow Foxtel to expand its streaming platforms and potentially increase subscription across both its cable and digital services.</p>
<p>Foxtel’s exclusive digital rights will also dictate what Seven can do with cricket coverage. In <a href="https://theconversation.com/sevens-olympic-coverage-could-change-the-way-we-watch-sport-on-our-screens-60563">recent</a> years Seven has established a free (with ads) and premium service for its major sporting rights, including the tennis and the Olympics. For the cricket it appears that Seven will not be able to incorporate this approach.</p>
<p>Despite this <a href="http://www.sevenwestmedia.com.au/assets/pdfs/180413-SWM-Cricket2.pdf">Seven executives see</a> the cricket rights as a better deal in comparison to the tennis rights, which it recently <a href="https://www.nineentertainmentco.com.au/2018/03/29/11/30/nine-secures-all-rights-to-tennis">lost</a> to the Nine Network. This is because the cricket media rights give the company over 400 hours of sport, more than double that of the Australian Open.</p>
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<a href="https://theconversation.com/declining-sport-viewership-shows-why-we-should-keep-it-on-free-tv-72357">Declining sport viewership shows why we should keep it on free TV</a>
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<p><a href="https://theconversation.com/chasing-the-audience-is-it-over-and-out-for-cricket-on-free-to-air-tv-76792">Previously</a> UBS media analyst Eric Choi had stated that Nine lost A$30-40 million a year on the current cricket rights deal. Nine will still have cricket as part of its <a href="http://www.adnews.com.au/news/seven-and-foxtel-secure-cricket-media-rights-in-1bn-deal#IcOHmgeXZ32QV67p.99">schedule</a> as it has rights to the next Ashes series from England and the ODI World Cup in the UK in 2019 and the T20 World Cups in Australia in 2020.</p>
<p>The biggest loser from the broadcasters’ perspective is Ten, that has held the rights and gained high ratings from the Big Bash League. It will now need to find programming to fill a very big void in its summer lineup.</p>
<p>Now Cricket Australia has to play a balancing act to make sure cricket is not placed behind a pay-wall and therefore see levels of participation <a href="https://theconversation.com/chasing-the-audience-is-it-over-and-out-for-cricket-on-free-to-air-tv-76792">decline</a>, as seen in the UK.</p>
<p>It has to ask itself, will Australians pay to watch cricket on their screens?</p><img src="https://counter.theconversation.com/content/94976/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>A 40-year partnership between Cricket Australia and the Nine Network ended today, with Seven and Foxtel securing media rights. The deal means more hours of coverage and is a big win for Foxtel.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/823672017-08-15T06:24:16Z2017-08-15T06:24:16ZA fragmented streaming video market is good for everyone but the consumer<figure><img src="https://images.theconversation.com/files/182026/original/file-20170815-29240-1ducut4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Disney is leaving Netflix. Is the streaming market becoming too fragmented?</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/paris-france-december-15-2016-netflix-539808154?src=iM2bF1g7wRFRxF9lKZstEQ-1-6">pixinoo/Shutterstock</a></span></figcaption></figure><p>Streaming video platforms were meant to put choice back in the hands of the viewer. They’d be able to watch the content they wanted, when they wanted. But the growing fragmentation of the on-demand market threatens to leave consumers worse off.</p>
<p>While Netflix and Amazon are among the biggest subscription video on demand (SVOD) players, they have plenty of competitors for content. In Australia, <a href="http://www.news.com.au/technology/home-entertainment/tv/stan-signs-multiyear-content-deal-with-premier-us-network-showtime/news-story/5fa0b0dd5a1da42a6ed1d0f61041a9a3">Stan</a> and <a href="https://www.foxtel.com.au/whats-on/foxtel-insider/foxtel/home-of-hbo.html">Foxtel</a> have programs from Showtime and HBO respectively largely locked down. And <a href="http://variety.com/2017/digital/news/disney-netflix-end-acquires-bamtech-espn-ott-services-1202519917/">Disney is set to abandon</a> Netflix in favour of creating its own platform – a trend we’re sure to see more of from the major entertainment studios.</p>
<p><a href="https://thewaltdisneycompany.com/walt-disney-company-acquire-majority-ownership-bamtech/">Announcing that</a> it had acquired majority ownership in BAMTech, a streaming technology company, Disney said it sees the future of media as “defined by direct relationships between content creators and consumers”. </p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/is-liking-something-on-facebook-protected-political-speech-it-depends-82209">Is liking something on Facebook 'protected political speech'? It depends</a>
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<p>Facebook’s <a href="https://newsroom.fb.com/news/2017/08/introducing-watch-a-new-platform-for-shows-on-facebook/">recent announcement</a> of its video platform Watch is also a sign of things to come. Like traditional media and television, technology companies are making attempts to <a href="https://theconversation.com/with-the-rise-of-subscription-and-online-tv-we-need-to-rethink-local-content-rules-79496">re-position</a> themselves and take advantage of the <a href="http://www.nielsen.com/au/en/insights/news/2017/small-screens-driving-audience-growth-to-netflix.html">rapid uptake</a> of streaming services and changing viewer behaviour. </p>
<p>But while these new services give consumers unlimited entertainment options, for the most part, they don’t come for free. The cost and confusion of having content tied to so many different players could ultimately provoke a return to bundling and a pay TV model.</p>
<h2>It’s all about originals</h2>
<p>Netflix and Amazon are known for their original content, and they use these exclusive programs to persuade customers to subscribe. They’re also cheaper than having to negotiate rights and region deals with the studios.</p>
<p>Netflix <a href="https://www.cnbc.com/2017/05/31/netflix-spending-6-billion-on-content-in-2017-ceo-reed-hastings.html">is reported</a> to be spending US$6 billion on original content this year. Amazon will also pay a <a href="https://www.businessinsider.com.au/amazon-video-budget-in5-billion-2017-4">considerable amount</a> – by some estimates, it could hand over around US$4.5 billion in 2017.</p>
<p>In addition to SVOD companies, many social media platforms and technology companies are adding video streaming to their offerings. They’re using the original productions approach of Netflix and Amazon, which has arguably become the industry standard. </p>
<p>YouTube <a href="https://www.bloomberg.com/news/articles/2017-05-04/with-40-new-original-shows-youtube-targets-tv-s-breadbasket">is set</a> to fund the production of more than 40 original shows and movies in the next year. This <a href="https://www.theverge.com/2017/8/4/16095448/youtube-red-karate-kid-cobra-kai-series-announced">includes</a> outbidding Netflix and Amazon for the series Cobra Kai, a Karate Kid sequel, which will appear on the company’s <a href="https://theconversation.com/youtube-red-is-here-and-it-breaks-the-video-on-demand-mould-59656">subscription</a> service, YouTube Red.</p>
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<figcaption><span class="caption">Apple Carpool Karaoke - Will Smith with James Corden.</span></figcaption>
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<p>Apple has created original content for Apple Music. The first was <a href="https://www.planetoftheapps.com">Planet of the Apps</a>, a startup show similar to Shark Tank, which had <a href="http://variety.com/2017/tv/reviews/planet-of-the-apps-apple-gwyneth-paltrow-jessica-alba-1202456477/">limited success</a>. More recently, it commissioned <a href="https://itunes.apple.com/show/carpool-karaoke/id1219046821?app=music">Carpool Karaoke: The Series</a>.</p>
<p>Facebook’s recent announcement of its video platform <a href="https://newsroom.fb.com/news/2017/08/introducing-watch-a-new-platform-for-shows-on-facebook/">Watch</a> suggests the company also sees original video as a key part of its future. <a href="https://www.theverge.com/2017/6/26/15872750/facebook-original-content-tv-shows-budget-ads-data">It’s reported</a> that Facebook is willing to pay up to US$3 million per episode for “centerpiece” shows. Refinery29’s Strangers, which featured at Sundance Film Festival, <a href="https://www.theverge.com/2017/6/26/15872750/facebook-original-content-tv-shows-budget-ads-data">is rumoured</a> to be part of Facebook’s future original content lineup.</p>
<p>In addition, it’s likely more studios will follow Disney’s lead and attempt to support their own direct-to-consumer platform. In the US, for example, the cable channel FX recently <a href="https://www.nytimes.com/2017/08/07/business/media/fx-comcast-ad-free-service.html">launched an</a> ad-free subscription service that features its popular shows like American Horror Story and The Americans.</p>
<h2>What will consumers pay for?</h2>
<p>The continued upheaval in the SVOD market could end up pricey and unwieldy for consumers.</p>
<p>While they want choice, and individually the various subscription services are relatively cheap, accessing a significant breadth of original content will require multiple subscriptions.</p>
<p>Netflix’s monthly prices <a href="https://www.gizmodo.com.au/2017/06/australia-your-netflix-just-got-more-expensive/">vary across</a> three price brackets: AU$9.99, AU$13.99 or AU$17.99, depending on the number of screens, and if you wish to have HD. Stan <a href="https://help.stan.com.au/hc/en-us/articles/115005777028-Stan-subscription-plans">starts at</a> AU$10 a month and rises to AU$15.</p>
<p>Apple Music has three price <a href="https://www.apple.com/au/apple-music/membership/">points</a>: a student price of AU$5.99, individual AU$11.99 and family AU$17.99. A <a href="https://www.youtube.com/red">YouTube Red</a> subscription will cost at least AU$11.99.</p>
<p>Combining a few of these services could see a family paying more than AU$60 a month. And this doesn’t include any future additions like Disney, nor sports packages where there are also numerous streaming options.</p>
<p>Could we get to a point where bundled or aggregated subscription services, like a new incarnation of pay TV, become a more feasible choice? </p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/country-rules-the-splinternet-may-be-the-future-of-the-web-81939">Country rules: the ‘splinternet’ may be the future of the web</a>
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<p>Pay TV player Foxtel <a href="https://theconversation.com/shame-the-technical-glitches-that-hit-game-of-thrones-could-limit-other-popular-live-streamed-events-81163">recently</a> re-branded and restructured its streaming service. Foxtel Now has <a href="https://www.foxtel.com.au/now/shop.html">starting packs</a> like Lifestyle, Kids or Docos for AU$10, with the Drama or Pop pack at AU$15 per month. Customers can then add premium packs – Movies or Sport for AU$20 and AU$29 per month each. </p>
<p>Some families may see these packages as more favourable and manageable from a cost perspective.</p>
<p>But pricing doesn’t matter if the premium original content isn’t there, and we’re sure to see further fragmentation thanks to content producers establishing direct-to-consumer platforms. The question is now: just how many platforms can viewers handle and how many are they willing to pay for?</p><img src="https://counter.theconversation.com/content/82367/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>The cost and confusion of having content tied to so many different streaming platforms could ultimately provoke a return to bundling and a pay TV model.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/811632017-07-19T06:03:45Z2017-07-19T06:03:45ZShame! The ‘technical glitches’ that hit Game of Thrones could limit other popular live-streamed events<figure><img src="https://images.theconversation.com/files/178552/original/file-20170718-21742-pc1t8e.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Not everyone got to see Cersei Lannister (Lena Headey ) and Jaime Lannister (Nikolaj Coster-Waldau) in the opening season seven episode of Game of Thrones.</span> <span class="attribution"><a class="source" href="http://www.imdb.com/title/tt5654088/mediaviewer/rm1517238016">HBO</a></span></figcaption></figure><p>Winter was coming with the first episode of the new Game of Thrones series this week, but the real freeze was a technical one.</p>
<p>Many fans across the world were unable to watch the much anticipated season opener using legal streaming services, such as <a href="https://www.foxtel.com.au/now/index.html">Foxtel Now</a> in Australia. </p>
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<p>Foxtel <a href="http://community.foxtel.com.au/t5/Foxtel-Press-Releases/Game-of-Thrones-phenomenon-crash-sites-across-the-globe/m-p/206549">issued a statement on Monday</a> saying the problem was due to “technical glitches around the world”.</p>
<p>This technical glitch is extremely concerning, not just for fans of Game of Thrones but for the future of streaming video of major events and programming.</p>
<h2>The focus on streaming</h2>
<p>It was only last month that Foxtel launched its new logo and rebranded its Foxtel Play streaming service as Foxtel Now.</p>
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<a href="https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/178761/original/file-20170719-31776-nwwqw2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">New logo for Foxtel Now.</span>
<span class="attribution"><a class="source" href="https://www.foxtel.com.au/about/media-centre/press-releases/2017/introducing-foxtel-now.html">Foxtel</a></span>
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<p>The company’s <a href="https://www.foxtel.com.au/about/media-centre/press-releases/2017/introducing-foxtel-now.html">announcement</a> of the new service promised Game of Thrones fans – and those of other programs – that they could now enjoy their favourite shows in high definition for as little as A$15 per month.</p>
<p>Previously, the only way to access Game of Thrones legally in Australia was via Foxtel’s “<a href="https://www.lifehacker.com.au/2017/06/is-foxtel-now-worth-the-money/#Ro4vibhY3UVQSKJc.99">prohibitively expensive Pay TV offerings</a>”. </p>
<p>This restricted access had seen Australians become some of the world’s leaders in <a href="https://theconversation.com/from-convicts-to-pirates-australias-dubious-legacy-of-illegal-downloading-39912">illegally downloading</a> previous seasons of Game of Thrones. </p>
<p>Even with the cheaper access via Foxtel Now, a <a href="http://www.smh.com.au/technology/technology-news/game-of-thrones-one-third-of-australian-fans-planning-to-pirate-season-7-20170629-gx107h.html">Finder.com.au survey</a> showed that more than 30% of people said they would be illegally downloading the new season.</p>
<p>The glitch this week will create headaches for Foxtel, and raises questions over the viability of its cheaper streaming alternative to its premium pay TV service.</p>
<p>Many Australians vented their frustration on social media via the hashtag <a href="https://twitter.com/hashtag/foxtelfail">#FoxtelFail</a> and on <a href="http://community.foxtel.com.au/t5/Foxtel-Press-Releases/Game-of-Thrones-phenomenon-crash-sites-across-the-globe/m-p/206549">Foxel’s community board</a>. </p>
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<p>But while Australians targeted their anger at Foxtel, the glitch was global.</p>
<h2>A global problem</h2>
<p>In addition to Australia, fans in the <a href="http://www.nydailynews.com/entertainment/tv/game-thrones-season-7-premiere-shatters-viewership-records-article-1.3334919">United States</a>, <a href="http://community.foxtel.com.au/t5/Foxtel-Press-Releases/Game-of-Thrones-on-Foxtel/td-p/206805">Latin America</a> and <a href="http://indianexpress.com/article/entertainment/television/hotstar-failed-to-stream-game-of-thrones-season-7-premiere-episode-and-faced-flak-4754913/">India</a> also faced the same frustrating technical issues.</p>
<p><a href="http://www.hotstar.com/">Hotstar</a>, an Indian online streaming service, had been <a href="http://gadgets.ndtv.com/entertainment/news/game-of-thrones-season-7-episode-1-torrents-download-got-s07e01-hotstar-1725707">promoting</a> an “Hours Before Torrents” promise. Its advertising used the phrases “Torrent Morghulis” and that “torrents must die”, both based on popular Game of Thrones phrases.</p>
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<a href="https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=279&fit=crop&dpr=1 600w, https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=279&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=279&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=351&fit=crop&dpr=1 754w, https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=351&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/178762/original/file-20170719-4932-1em6igt.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=351&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Advertising ahead of Game of Thrones premiere on Hotstar.</span>
<span class="attribution"><a class="source" href="https://www.facebook.com/hotstar/photos/a.1559468234297503.1073741827.1506095676301426/1960676820843307/?type=3&theater">Hotstar</a></span>
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<p>Unfortunately the creative marketing campaign will now be laughed at as torrents of the premiere program were reportedly <a href="http://gadgets.ndtv.com/entertainment/news/game-of-thrones-season-7-episode-1-torrents-download-got-s07e01-hotstar-1725707">available illegally</a> 45 minutes before the episode was available on Hotstar.</p>
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<h2>An unexpected surge</h2>
<p>Foxtel has redirected the blame for the technical glitch towards both its own customers – thanks to a <a href="https://mumbrella.com.au/foxtel-elaborates-on-game-of-thrones-glitch-458755">40% surge in new subscriptions</a> in the 48 hours before episode one’s screening time – and to Game of Thrones’ <a href="http://www.abc.net.au/news/2017-07-18/foxtel-blames-hbo-for-bungling-game-of-thrones-season-7-premiere/8718624">US production company HBO</a>.</p>
<p>Level 3 Communications is HBO’s partner in delivering its HBO Go streaming service. Diane Tryneski, chief digital officer at HBO, <a href="http://investors.level3.com/investor-relations/press-releases/press-release-details/2017/HBO-Streams-Game-of-Thrones-Season-7-Using-Level-3s-CDN/default.aspx">had said ahead of the season premiere</a> that Level 3 was pivotal in its “ability to stream Game of Thrones and other HBO programming to our customers”.</p>
<p>Laurinda Pang, Level 3’s regional president for North America and Asia Pacific, added that with more viewers and devices accessing HBO GO content, “the importance of relying on a network optimised for media delivery cannot be overstated”.</p>
<p>But it appears that the anticipated numbers of people simultaneously accessing the Game of Thrones opening episode were underestimated. This is a situation to which Australians can relate – a similar congestion-based crash contributed to last year’s <a href="https://theconversation.com/did-the-census-really-suffer-a-denial-of-service-attack-63755">census debacle</a>.</p>
<p>It is hard to acknowledge that viewer estimates for this popular series could be so wrong, given its <a href="http://variety.com/2016/tv/ratings/game-of-thrones-ratings-season-6-finale-record-1201805035/">ratings success at the end of series six</a> in 2016.</p>
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<h2>Global streaming future</h2>
<p>But this latest technical glitch raises some bigger questions.</p>
<p>There is continual evidence in <a href="http://www.nielsen.com/be/en/insights/reports/2017/the-nielsen-total-audience-report-q1-2017.html">the US</a> and <a href="http://www.oztam.com.au/documents/Other/Australian%20Video%20Viewing%20Report%20Q1%202017%20Final.pdf">Australia</a> that audiences are changing their viewing behaviours.</p>
<p>There is a global shift from traditional television broadcast to online services, streaming and video-on-demand services. So can these services handle the future loads that are anticipated? </p>
<p>This is not just in reference to prerecorded content such as Game of Thrones, but also to live content in which technical issues, buffering and low quality video will impact the viewing experience. There was <a href="http://www.news.com.au/sport/olympics/sports-life/sevens-olympic-app-plagued-by-technical-problems-blamed-on-unprecedented-demand/news-story/5dc9aa183bb8fd3a0688affc7309c40c">evidence of these types of issues</a> last year with the Rio Olympic Games streaming content.</p>
<p>Streaming video will only continue to grow with predictions it will be 82% of all <a href="http://www.cisco.com/c/en/us/solutions/collateral/service-provider/visual-networking-index-vni/complete-white-paper-c11-481360.pdf">consumer internet traffic</a> by 2021. </p>
<p>The growth of video will not just be via IP data, but also mobile. It’s estimated that almost 80% of <a href="http://www.cisco.com/c/en/us/solutions/collateral/service-provider/visual-networking-index-vni/mobile-white-paper-c11-520862.html">global mobile data</a> will be video by 2021. </p>
<h2>What’s bigger than Game of Thrones?</h2>
<p>With this in mind, could the internet handle major events such as a Superbowl television audience? </p>
<p>Last year its <a href="http://fortune.com/2017/02/06/super-bowl-111-million-viewers/">TV audience</a> was more than 111 million in the US alone – far more than the 16 million <a href="http://www.smh.com.au/entertainment/tv-and-radio/game-of-thrones-crowned-as-record-audience-wage-war-with-streaming-glitches-20170717-gxd6ze.html">reported</a> to have watched the latest episode of Game of Thrones.</p>
<p>Even adding the <a href="http://community.foxtel.com.au/t5/Foxtel-Press-Releases/Game-of-Thrones-on-Foxtel/td-p/206805">Australian</a> and <a href="http://www.smh.com.au/entertainment/tv-and-radio/game-of-thrones-crowned-as-record-audience-wage-war-with-streaming-glitches-20170717-gxd6ze.html">UK</a> figures of 1.5 million and 2.8 million respectively, it was far from a Superbowl TV audience.</p>
<p>The Superbowl online audience question was presented to a panel of experts in the US in May this year, with some interesting responses. The <a href="http://www.nscreenmedia.com/live-streaming-super-bowl-size-2022/">experts’ consensus</a> was that a live stream of the event over the internet to match the regular TV audience figure would be possible, but not until about 2023.</p><img src="https://counter.theconversation.com/content/81163/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>The problems some people had trying to watch Game of Thrones via the internet shows we still have a long way to go before we can live-stream major events to a mass online audience.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/794962017-06-16T05:04:03Z2017-06-16T05:04:03ZWith the rise of subscription and online TV, we need to rethink local content rules<figure><img src="https://images.theconversation.com/files/173972/original/file-20170615-23542-fqy55g.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Kate McCartney and Kate McLennan in The Katering Show (2015), which began as a short form web series.</span> <span class="attribution"><span class="source">idmb</span></span></figcaption></figure><p>The newly released Australian Bureau of Statistics (ABS) report on Film, Television and Digital Games <a href="http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/8679.0Main%20Features12015-16?opendocument&tabname=Summary&prodno=8679.0&issue=2015-16&num=&view=">2015-16</a> offers fascinating insights into how our screen media landscape has changed over the past four years.</p>
<p>A key factor has been the <a href="https://theconversation.com/netflix-arrival-will-be-a-tipping-point-for-tv-in-australia-38386">introduction</a> of subscription video-on-demand services in early 2015. Indeed, the report notes that the income of subscription broadcasters and channel providers (A$5.3 billion), such as Netflix, Stan and Foxtel, now exceeds that of commercial free-to-air broadcasters (A$3.9 billion).</p>
<p>So, what does this mean for the Australian screen media landscape?</p>
<p>Set against the <a href="https://theconversation.com/ten-networks-problems-are-history-repeating-79420">Ten Network’s woes</a> and media reforms being <a href="https://mumbrella.com.au/fifield-tens-voluntary-administration-wake-call-opponents-proposed-media-reforms-451413">debated</a> by the federal government, the ascendancy of subscription broadcasting adds to the worries of free-to-air broadcasters. </p>
<p>The number of commercial free-to-air broadcast businesses dropped over the four-year period measured by the ABS report from 24 to 14. Income declined from $4.6 billion in 2011-12 (the time of the last report) to $3.9 billion (2015-16) and operating profit before tax from $996 million to $420 million.</p>
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<p>Subscription broadcasters and channel providers saw a huge increase in income - from $4.6 billion to $5.3 billion - although their total expenses also increased. (The total number of businesses in the area declined slightly from 36 to 32 in this period).</p>
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<p>A recent Roy Morgan report found that more than one in three Australians now have <a href="https://www.roymorgan.com/findings/7242-netflix-subscriptions-march-2017-201706080957">Netflix</a>, an increase of 20% in the first quarter for 2017. <a href="http://www.roymorgan.com/findings/7118-netflix-subscribers-and-commercial-television-december-2016-201701310906">According</a> to Roy Morgan, </p>
<blockquote>
<p>Netflix subscribers watch less commercial TV than others. </p>
</blockquote>
<p>And Foxtel last week announced a revision of its streaming and on-demand service, Foxtel Play - now called Foxtel Now - after buying out its joint venture partner in Presto, the Seven Network, and shutting Presto down. Meanwhile, we are still yet to see the full impact of Amazon Prime in Australia, which arrived here late last year.</p>
<h2>Other threats to free to air</h2>
<p>But free-to-air TV faces other threats. This report shows there has also been an enormous increase in non-TV production for online distribution. The makers of these shows use platforms like YouTube to gain access to a global audience, far greater than that available through traditional TV broadcast. </p>
<p>Many <a href="https://theconversation.com/the-battle-for-audiences-as-free-tv-viewing-continues-its-decline-58051">Australian YouTubers with large followings</a> and subscribers have a greater audience than some TV programs. For instance, <a href="https://www.youtube.com/user/Reslim">Jamie and Nikki</a>, a Melbourne-based couple, have more than a million subscribers and receive hundreds of thousands of views within days of uploading new videos, without any association to traditional TV networks.</p>
<p>There are also examples of shows such as <a href="https://www.youtube.com/user/LeadBalloonTV">The Katering Show</a>, which have <a href="http://www.smh.com.au/entertainment/tv-and-radio/the-katering-shows-kates-to-tackle-breakfast-tv-in-new-abc-series-get-krackn-20170215-gue17a.html">moved</a> from a short format web-series to a long format TV series. The Katering Show’s makers have created a new full-length series for the ABC titled Get Krack!n, which is co-funded by Film Victoria and NBC Universal’s US comedy streaming channel Seeso.</p>
<p>Screen Australia CEO Graeme Mason <a href="https://www.screenaustralia.gov.au/sa/media-centre/news/2017/06-15-abs-survey-results?utm_source=email&utm_medium=media-release&utm_campaign=abs-survey-results">pointed out yesterday</a> that:</p>
<blockquote>
<p>online content creators… have delivered exponential production growth, now representing $93.6m of non-TV production costs compared to just $5.5m in the 2011/12 survey.</p>
</blockquote>
<p>The number of webisodes increased from 107 (2011-12) to 3248 (2015-16). As Screen Australia <a href="https://www.screenaustralia.gov.au/sa/media-centre/news/2017/06-15-abs-survey-results?utm_source=email&utm_medium=media-release&utm_campaign=abs-survey-results">noted</a>, </p>
<blockquote>
<p>Since 2012, Screen Australia has funded 107 online projects including Soul Mates, The Katering Show and Starting from Now.</p>
</blockquote>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/qzbOBzQpUX4?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">The first episode of Starting From Now, which began as a web series and was later picked up by SBS 2.</span></figcaption>
</figure>
<p>The digital game developers’ sector has also seen an <a href="https://www.screenaustralia.gov.au/sa/media-centre/news/2017/06-15-abs-survey-results?utm_source=email&utm_medium=media-release&utm_campaign=abs-survey-results">increase</a> in employment - up 26% since the 2011/12 survey. Income in the sector rose from $89 million to $111 million. </p>
<iframe src="https://datawrapper.dwcdn.net/pohIX/1/" scrolling="no" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="500"></iframe>
<p>Then there is the <a href="https://theconversation.com/the-rise-of-the-pro-player-as-australia-hosts-its-richest-computer-gaming-event-76865?sa=google&sq=esports&sr=5">increased</a> interest in eSports. Sydney <a href="https://theconversation.com/the-rise-of-the-pro-player-as-australia-hosts-its-richest-computer-gaming-event-76865?sa=google&sq=esports&sr=5">recently</a> hosted a Counter-Strike: Global Offensive event with a record $260,000 in prize money. The AFL is interested in this area, with the Adelaide Crows <a href="http://www.foxsports.com.au/afl/adelaide-crows-buys-professional-gaming-team-legacy-esports-best-known-for-their-league-of-legends-team/news-story/ad0a43e10f1d5a90f7fb2bc6412c5138">recently</a> acquiring its own eSports team.
There is also <a href="https://theconversation.com/the-rise-of-the-pro-player-as-australia-hosts-its-richest-computer-gaming-event-76865?sa=google&sq=esports&sr=5">The eSports Network</a>, a newly formed media company that plans to bring eSports to Australian screens in the near future. </p>
<p>Other key findings of the ABS report include a slight rise in the income of film and video production businesses and digital game developers. This is despite a fall in the overall number of game productions from 245 in 2011-12 to just 178.</p>
<iframe src="https://datawrapper.dwcdn.net/D2IHM/6/" scrolling="no" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="400"></iframe>
<p>Based on Ten’s recent announcement and the continued discussion around the revenue decline in television, Australia’s television networks need to rethink what a network is in this ever-changing media landscape. </p>
<p>Seven has made the first move here, particularly in relation to its recent re-negotiations with Yahoo. Opting to keep both its <a href="https://7live.com.au">seven.com.au</a> website and <a href="https://au.yahoo.com">Yahoo7</a> separate, Clive Dickens, Seven’s chief digital officer, <a href="https://mumbrella.com.au/critically-important-seven-no-longer-seen-broadcaster-clive-dickens-following-amended-yahoo7-deal-451612">observed that</a>, “Seven is no longer purely a broadcaster, it is a total video company”. </p>
<h2>What about local content?</h2>
<p>These trends raise questions about how to provide adequate local content. Should <a href="https://theconversation.com/is-a-quota-the-key-to-getting-netflix-and-co-to-spend-more-on-australian-content-60308">Netflix and co</a> be subject to a local content quota in the same way that the free-to-air broadcasters are?</p>
<p>But this discussion needs to broaden beyond subscription TV providers: it must be consider all platforms and screens. According to the recent <a href="http://www.oztam.com.au/documents/Other/Australian%20Multi%20Screen%20Report%20Q1%202016%20FINAL.pdf">Australian Multiscreen Reports</a>, Australians now spend an average eight hours and 33 minutes per month watching online video via a PC or Laptop, up from six hours and 57 minutes just a year ago. </p>
<p>Australians’ viewing habits are continuing to change. We must rethink the local content quotas in light of this and the new media landscape. A quota on specific platforms will no longer be sufficient as the screen media industry evolves.</p><img src="https://counter.theconversation.com/content/79496/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>New ABS figures on film, TV and digital gaming show that subscription broadcasters and online content creators are booming. Yet local content quotas only apply to free-to-air broadcasters.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/724942017-02-08T03:23:38Z2017-02-08T03:23:38ZFight over live-streamed sport to go on after final bell sounds<figure><img src="https://images.theconversation.com/files/155825/original/image-20170207-4240-5qs3ul.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Nearly 300,000 people tuned into two live streams on Facebook of the Anthony Mundine-Danny Green fight.</span> <span class="attribution"><span class="source">AAP/David Mariuz</span></span></figcaption></figure><p>When a Brisbane boxing fan who paid $59.95 for “live and exclusive” viewing of last Friday’s Danny Green v Anthony Mundine boxing match <a href="http://www.news.com.au/sport/sports-life/boxing-fan-live-streams-mundine-v-green-fight-over-facebook-live-wins-internet/news-story/72694120291078080d9b209fac9e67c4">streamed it off his TV</a> through a smartphone and Facebook Live, he landed quite a blow beneath Foxtel’s belt. An estimated 300,000 <a href="http://www.bandt.com.au/media/foxtel-take-legal-action-streamers-green-v-mundine-fight">tuned in</a> via this and another unauthorised stream.</p>
<p>This is the latest skirmish over premium live sport in Australia. Foxtel’s high-priced oligopolistic control over Australian pay TV has again clashed with the demands of sport fans and the increasingly sophisticated capture and relay technologies available to them.</p>
<p>In a constantly changing TV sport environment, pay-TV providers have many more bruising bouts ahead of them – unless they let go of their conventional model of TV-based subscription and move to multiple platforms.</p>
<h2>Foxtel scores an own goal</h2>
<p>The curious feature of <a href="https://mumbrella.com.au/foxtel-threatens-to-sue-as-facebook-pirates-plunder-mundine-vs-green-fight-424052">Foxtel’s response</a> to this purported act of mass piracy is the surprise at its occurrence, and its ham-fistedness. The <a href="http://www.abc.net.au/news/2017-02-04/green-v-mundine-live-streamers-warned-to-brace-for-legal-action/8241276">national coverage</a> accorded to Foxtel’s open threat to sue the <a href="http://www.bandt.com.au/media/foxtel-take-legal-action-streamers-green-v-mundine-fight">“two ordinary blokes”</a> who streamed the Mundine-Green fight achieved twin outcomes.</p>
<p>First, it elevated the profile of the two men, Brett Hevers and Darren Sharpe, who have become unlikely symbols of online resistance against perceived corporate greed. </p>
<p>As half-owner of Foxtel, News Corp Australia’s flagrant <a href="http://www.sunshinecoastdaily.com.au/news/two-face-5-years-jail-streaming-green-mundine-figh/3140108/">use of its news media syndication</a> to canvass five-year jail terms and $60,000 fines for the live-streamers was a self-administered punch by Goliath in his contest with David.</p>
<p>Foxtel’s decision to charge so much for access to the fight contrasts with <a href="https://mumbrella.com.au/foxtel-threatens-to-sue-as-facebook-pirates-plunder-mundine-vs-green-fight-424052">Hevers’ claim</a> that $10 would have been a fairer amount to pay. This is especially the case as pay-per-view subscribers would already have incurred the cost of ongoing subscriptions to be in a position to watch it. </p>
<p>Second, that Facebook Live and similar services can be used to bypass restrictions on subscription-based television content has now been advertised in headlines across Australia. A previously low-profile part of the <a href="https://books.google.com.au/books?id=WQacCAAAQBAJ&printsec=frontcover&dq=the+informal+media+economy&hl=en&sa=X&ved=0ahUKEwjptYHn1_zRAhWMNpQKHSRnA1IQ6AEIGTAA#v=onepage&q&f=false">informal media economy</a> is now common knowledge.</p>
<p>Almost the <a href="https://www.theguardian.com/technology/2015/may/04/twitter-periscope-winner-mayweather-pacquiao">exact same scenario</a> unfolded in the US just two years earlier during HBO and Showtime’s live pay-per-view coverage of the blockbuster fight between Floyd Mayweather and Manny Pacquiao. The only difference was the brand of the smartphone app used to circumvent the control of broadcast rights holders over access to the fight. The Twitter-owned Periscope service was the live-streaming app of choice among users on that occasion.</p>
<p>At least HBO and Showtime had the good sense to <a href="http://www.bbc.com/news/technology-32584454">limit their public statements</a> on the use of Periscope during the fight. </p>
<p>Foxtel’s errors are compounded by Facebook’s efforts to build a clear association between sport consumption and its Live service in the minds of millions of users. A reported US$4.4 million <a href="https://www.wsj.com/articles/facebook-enlists-soccer-elite-to-help-live-video-1469727818">has been paid</a> to popular athletes, teams and sports media companies around the world to create video content for Facebook Live.</p>
<p>The combination of Foxtel, Hevers, Sharpe and <a href="http://www.bandt.com.au/media/foxtel-take-legal-action-streamers-green-v-mundine-fight">300,000 viewers on Facebook</a> during the Green-Mundine fight has added to this push. The stage could be set for a knock ’em down, drag ’em out corporate tussle between Facebook and Foxtel.</p>
<h2>Can Foxtel keep up?</h2>
<p>Despite these missteps, it would be a mistake to assume that Foxtel is powerless against so-called digital disruptors. </p>
<p>Increased marketing of the Foxtel Play streaming service, particularly following the recent closure of Presto, and the offer of a bundled broadband service to new subscribers are indicative of an evolving business model designed to deliver content across multiple screens. </p>
<p>Actions are also being taken to counter rising competition from operators in the telecommunications sector. </p>
<p>When Optus <a href="http://www.businessinsider.com.au/how-optus-stole-the-english-premier-league-from-foxtel-2016-5">seized the rights</a> to the English Premier League from Foxtel for its mobile and broadband platforms, Foxtel contracted with beIN Sports to carry some premium European football and games on delay, and other material from the channels of six leading English Premier League clubs – at <a href="http://www.foxsports.com.au/football/epl-on-fox-sports-foxtel-ceos-open-letter-to-fans-about-optusfox-deals/news-story/9a26b28b92aad4bc596104dadb3efae1">no extra cost</a> to its subscribers.</p>
<p>So, Foxtel isn’t averse to giving away sport content when it suits its commercial interests. In this case, it did it to prevent the churning of paying customers to other services.</p>
<p>Rumbles like the one over the Mundine-Green live stream will no doubt proliferate. This technical knockout comes as Foxtel and other sport content owners transition from a service originally based on a big TV in the living room or the pub to a multiplicity of anytime, anywhere viewing platforms.</p>
<p>These owners won’t just have to deal with the spread of the NBN. They also must appreciate that the use of digital media technology is at least as much about capturing and uploading mobile content – say from the stands of a football stadium or the seats surrounding a boxing ring – as it is about receiving an expensive one-way communication provided by someone else.</p>
<p>Finally, there were other, non-pugilistic sport viewing opportunities on Australian TV last Friday night. People might have watched the A-League football match between Brisbane Roar and Sydney FC on free-to-air SBS.</p>
<p>Or, of greater historical significance, they could have resisted the dubious pleasure of paying $59.95 to watch <a href="http://www.theage.com.au/afl/eddie-everywhere-mcguire-missing-from-collingwoods-historic-aflw-debut-20170203-gu5gdi.html">Eddie McGuire</a> host the boxing in favour of witnessing – without charge – the opening match of the AFL women’s league between his Collingwood team and Carlton on Seven. </p>
<p>Women’s sport is on the rise on free-to-air TV. Anti-siphoning laws continue to prevent many of the major sports events in Australia from becoming the <a href="http://www.acma.gov.au/Industry/Broadcast/Television/TV-content-regulation/sport-anti-siphoning-tv-content-regulation-acma">exclusive property of subscription TV</a>. And then there is the constant, rapid development of disruptive technologies and services. </p>
<p>All together, this means the pay-TV sector needs to adapt quickly in appealing to subscribers whose attention now moves freely between different screens.</p><img src="https://counter.theconversation.com/content/72494/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>David Rowe has received funding from the Australian Research Council to support research relating to this article: Struggling for Possession: The Control and Use of Online Media Sport (with Brett Hutchins, DP0877777); 'A Nation of "Good Sports"? Cultural Citizenship and Sport in Contemporary Australia' (DP130104502), and 'Australian Cultural Fields: National and Transnational Dynamics' (with Tony Bennett et al, DP140101970). </span></em></p><p class="fine-print"><em><span>Brett Hutchins has received funding from the Australian Research Council to support research relating to this article: The Mobile Media Sport Moment: Investigating the Pivotal Role of Sport in Mobile Media Content, Markets and Technologies (FT130100506; <a href="http://artsonline.monash.edu.au/mobilemediasport/">http://artsonline.monash.edu.au/mobilemediasport/</a>), and Struggling for Possession: The Control and Use of Online Media Sport (with David Rowe, DP0877777).</span></em></p>Foxtel’s high-priced oligopolistic control over Australian pay TV has again clashed with the demands of sport fans and the increasingly sophisticated capture and relay technologies available to them.David Rowe, Emeritus Professor of Cultural Research, Institute for Culture and Society, Western Sydney UniversityBrett Hutchins, Professor of Media and Communications Studies, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/666832016-10-11T05:14:16Z2016-10-11T05:14:16ZBuyouts mean the future of Australian video-on-demand is hard to picture<figure><img src="https://images.theconversation.com/files/141174/original/image-20161011-3903-1y6nqdd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The hugely popular Game of Thrones could be a crucial drawcard for Foxtel Play's new viewers.</span> <span class="attribution"><span class="source">AAP Image/Village Roadshow Production</span></span></figcaption></figure><p>The dust is showing no sign of settling on Australia’s video-on-demand (VoD) media landscape. The past week has seen two seismic shifts which will have a flow-on effect on almost anyone who watches subscription-based television.</p>
<p>First came the news of <a href="http://www.abc.net.au/news/2016-10-04/presto-to-disappear-as-seven-sells-stake-to-foxtel/7900778">Foxtel’s takeover of Presto</a>, with the latter’s customers being transferred to Foxtel Play when Presto shuts down next year.</p>
<p>Then the ailing VoD service <a href="https://www.quickflix.com.au/">Quickflix</a> gained a surprise stay of execution, being <a href="http://www.smh.com.au/business/media-and-marketing/quickflix-snapped-up-for-13m-by-us-entrepreneur-20161004-gruqoq.html">saved by a US buyer</a> after going into <a href="https://theconversation.com/a-shake-up-in-australias-busy-tv-industry-as-quickflix-calls-in-the-administrators-58487">voluntary receivership</a> earlier this year.</p>
<p>The shakeup has left viewers wondering where their subscription fees are going to end up, and what content they will be able to access once the merry-go-round stops.</p>
<h2>Quickflix’s future?</h2>
<p>Quickflix’s problems began in 2014, when former stakeholder HBO sold its shares to Nine Entertainment. The following year the shares were transferred to Stan, Nine’s new joint VoD venture with Fairfax Media. </p>
<p>When Quickflix went into voluntary receivership, it stated Stan’s unwillingness to bargain with potential buyers as a key reason for its <a href="https://theconversation.com/a-shake-up-in-australias-busy-tv-industry-as-quickflix-calls-in-the-administrators-58487">demise</a>.</p>
<p>Quickflix has now been saved, although it is not clear what it will become or what its focus will be. US media entrepreneur Erik Pence has paid A$1.3 million, and the holding for the purchase, Karma Media, plans to retain 24 employees and pay entitlements to former employees. </p>
<p>There will <a href="http://www.smh.com.au/business/media-and-marketing/quickflix-snapped-up-for-13m-by-us-entrepreneur-20161004-gruqoq.html">reportedly</a> be more investment in marketing and a shift towards more niche content. This latter strategy has been a globally successful tactic for other VoD and online platforms such as <a href="http://netflix.com">Netflix</a>, <a href="http://youtube.com">YouTube</a> and <a href="https://www.fullscreen.com">Fullscreen</a>. </p>
<p>But it is unclear whether Quickflix’s new service will support the production of Australian content in any way – or even whether it will primarily offer movies, television series, or both. This makes it difficult to analyse the impact its re-emergence will have on the Australian VoD landscape.</p>
<h2>Hey Presto</h2>
<p>In contrast, the future of Presto has been made very clear indeed. Foxtel has acquired Seven West Media’s interests in the service and confirmed that it will cease on January 31, 2017. </p>
<p>This arguably makes Presto the first real casualty of the battle that has sprung up in Australia’s crowded VoD landscape.</p>
<p>Presto has been constantly reported as struggling for subscribers against competition from Netflix and Stan. A recent Roy Morgan <a href="http://www.roymorgan.com/findings/6839-netflix-stan-presto-subscription-video-on-demand-may-2016-201606141025">report</a> from this year showed how far Presto was behind its competition. </p>
<p>Presto had 142,000 subscriptions, less than half of the 332,000 signed up to its local competitor Stan. Even combined, these numbers are far short of international giant Netflix, which has <a href="http://www.roymorgan.com/findings/6839-netflix-stan-presto-subscription-video-on-demand-may-2016-201606141025">1,878,000 Australian subscriptions</a>.</p>
<p>Foxtel plans to move Presto’s subscribers over to its internet-delivered service Foxtel Play by the end of this year. In a <a href="https://www.foxtel.com.au/about/media-centre/press-releases/2016/foxtel-revamps-its-streaming-video-service.html">media release</a> Foxtel promised that “Presto customers will get access to more premium first run television programs and more recent movies than ever before” – raising the question of whether they were holding back on content before the takeover.</p>
<p>The Foxtel Play service also may not be what current Presto customers are expecting, nor is there a guarantee that it will end up costing the same.</p>
<h2>Does Foxtel really want to compete?</h2>
<p>It is clear that Foxtel is trying to compete with current VoD services, as underlined by its <a href="https://www.foxtel.com.au/about/media-centre/press-releases/2016/foxtel-revamps-its-streaming-video-service.html">recent announcement</a> that Foxtel Play entry prices will be cut to A$10 from the current A$25. But Foxtel Play’s <a href="https://www.foxtel.com.au/content/dam/foxtel/foxtelplay/support/pp-change/foxtel-play-pp-changes.pdf">subscription pricing structure</a> is much more complicated than other VoD services. </p>
<p>Unlike <a href="https://www.netflix.com/au/">Netflix</a> or <a href="https://www.stan.com.au">Stan</a>, which charge a flat fee for all content (although Netflix charges extra fees for more screens and HD qaulity), Foxtel Play has different prices for different content packages, much like Foxtel’s pay TV pricing structure. The content on Foxtel Play is not HD, although will <a href="http://decidertv.com/page/2016/10/7/foxtel-play-foxtel-go-will-make-the-switch-to-high-definition-foxtel">reportedly</a> be upgraded in 2017. </p>
<p>Foxtel Play’s <a href="https://www.foxtel.com.au/about/media-centre/press-releases/2016/foxtel-revamps-its-streaming-video-service.html">packages</a> include a basic offering of Documentary, Lifestyle or Kids programming at A$10 each per month, plus Premium Drama and Premium Entertainment options at A$15 each per month. Customers can also add Sport (A$25 per month) or Movies (A$20 per month) on top of these. So it seems likely that many customers end up paying more than those subscribing to other VoD services.</p>
<p>At first glance, Foxtel shutting down Presto could appear to be a way in which it can gain new Foxtel Play subscribers while dissuading viewers from defecting to Stan or Netflix. But the actual numbers may be small, according to Roy Morgan’s recent <a href="http://www.roymorgan.com/findings/6990-most-presto-subscribers-already-have-netflix-stan-or-foxtel-too-august-2016-201610050930">research</a>. </p>
<p>Of the 143,000 Australian homes with Presto, 77% already have an alternative VoD or pay TV service, which could include Netflix, Stan and Foxtel. Of Presto households, 55% also use Netflix and 27% have signed up to Stan. </p>
<p>Meanwhile, almost half of Presto subscribers already have Foxtel, mainly through its traditional set-top box service. Foxtel itself has <a href="https://mumbrella.com.au/foxtel-admits-subscriber-figures-include-presto-users-but-claims-cable-still-biggest-growth-driver-311968">admitted</a> to using Presto subscription numbers to bump up its own quoted subscriber growth numbers for 2015. </p>
<p>But Foxtel has two key advantages over Netflix and Stan. The first is HBO content, most notably the wildly popular series Game of Thrones. Next year Foxtel will <a href="https://www.foxtel.com.au/about/media-centre/press-releases/2016/foxtel-revamps-its-streaming-video-service.html">significantly increase</a> the amount of HBO content it offers.</p>
<p>The second advantage is sport, which fittingly is where the fiercest competition is set to play out among rival platforms.</p>
<h2>Into the sporting arena</h2>
<p>Sport streaming is poised as the next battleground in Australian video streaming, VoD and video subscriptions. If planned changes to <a href="http://www.acma.gov.au/Industry/Broadcast/Television/TV-content-regulation/sport-anti-siphoning-tv-content-regulation-acma">anti-siphoning rules</a> are made, the battle will become even more intense.</p>
<p>Foxtel Play’s pricing will allow access to Foxtel’s sports package for A$35 a month, A$15 cheaper than its pay TV sports package. But is it cheap enough?</p>
<p>Telcos themselves have now become sports broadcasters, with both <a href="https://www.telstra.com.au/tv-movies-music/sport">Telstra</a> and <a href="http://www.optus.com.au/shop/entertainment/sport">Optus</a> heavily invested in sports streaming – the latter after <a href="https://theconversation.com/optus-the-new-player-in-australias-sports-media-rights-battle-50069">sensationally pinching</a> the rights to the Premier League from Foxtel. </p>
<p>Seven’s recent broadcast of the Rio 2016 Olympics also <a href="https://theconversation.com/the-rio-olympics-are-a-test-case-for-the-future-of-sports-broadcasting-63589">raised many questions</a> about future sports broadcasting and media rights. With Seven no longer involved with Presto, it could set its sights on sport and furthering its partnership with Telstra.</p>
<p>If Telstra were to <a href="https://theconversation.com/bed-fellows-no-more-its-foxtel-versus-telstra-in-battle-for-online-subscribers-56672">sell its stake</a> in Foxtel, it may decide to invest more money in becoming a direct competitor to Foxtel Play.</p>
<p>This will open opportunities for streaming not only for major international competitions, but leagues that currently enjoy less funding and publicity. The Women’s AFL could be a perfect place to start – offering a homegrown product to homegrown viewers.</p><img src="https://counter.theconversation.com/content/66683/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>With Quickflix saved but Presto on the way out, it’s hard to predict who will emerge as the winners as battle for video-on-demand viewers intensifies.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/566722016-03-22T23:41:43Z2016-03-22T23:41:43ZBed fellows no more? It’s Foxtel versus Telstra in battle for online subscribers<p>Foxtel has previously been coy about confirming <a href="http://www.news.com.au/technology/home-entertainment/tv/speculation-grows-that-foxtel-will-release-competitor-to-apple-tv-and-telstra-tv/news-story/0dd99f4c3bd9bdb363894694b225f3e0">speculation</a> it is planning to launch a service that will compete with Telstra TV and Apple TV.</p>
<p>But new chief executive Peter Tonagh has now told <a href="http://www.dailymail.co.uk/news/article-3502494/Could-Foxtel-Netflix-join-forces-Pay-TV-company-wants-offer-rival-streaming-service-s-content-win-customers.html">reporters</a> that it would ‘maximise’ all its distribution platforms, leading to speculation it would launch against part-owner Telstra’s own device.</p>
<p>His comments come amid reports Telstra is considering a A$4.5 billion initial public offering or sale of its 50% Foxtel stake. </p>
<p>Tonagh, who in a surprise move recently replaced Richard Freudenstein after four-and-a-half years at the helm, must usher Foxtel through a fast-changing media landscape which continues to be disrupted by subscription video-on-demand (SVoD) operators such as Netflix. </p>
<h2>The SVoD phenomenon</h2>
<p>Last year saw a massive change in the way in which Australians access and view video media. SVoD services launched included Stan, Presto (of which Foxtel is a joint partner with Seven West Media) and Netflix, along with Telstra <a href="http://www.smh.com.au/digital-life/computers/gadgets-on-the-go/hands-on-telstra-tv-streaming-media-player-20151025-gki7sd.html">introducing</a> its Telstra TV service. </p>
<p>This came at a time when the <a href="http://www.oztam.com.au/documents/Other/Australian%20Multi%20Screen%20Report%20Q4%202015%20FINAL.pdf">Australian Multi-screen report</a> continued to show a declining trend in the hours Australians spend watching live broadcast television, along side a rise in online video viewing hours.</p>
<p>Media analysts have forecast that last year’s decline would continue throughout 2016. UBS noted that there would be <a href="http://www.afr.com/business/media-and-marketing/ubs-cuts-valuations-for-seven-nine-as-netflix-steals-eyeballs-20150722-gihrtk">no growth</a> by the Australian television networks in 2016. Commonwealth Bank analysts also <a href="http://www.smh.com.au/business/media-and-marketing/telstra-ponders-foxtels-future-20151106-gkshq9.html">valued</a> Foxtel’s equity at A$3.6 billion, or 7.5 times the broker’s 2016 forecast for earnings, which <a href="http://www.abc.net.au/news/2016-03-18/telstra-may-sell-foxtel-stake-as-pay-tv-giant-struggles/7259506">fuelled rumours</a> that Telstra may look to sell off its 50% stake.</p>
<p>While the SVoD market is still in its infancy within Australia, uptake has been immense, with Netflix the main beneficiary. Foxtel’s venture, Presto, has struggled to <a href="http://www.adnews.com.au/news/netflix-reaches-2-2m-australians-but-growth-is-slowing-down">reach</a> a 1% uptake in Australian homes, far from the currently <a href="http://www.roymorgan.com/findings/6633-netflix-growth-slows-by-end-of-year-december-2015-201601182300">reported</a> 11% uptake of Netflix. </p>
<p>In the last few days another SVoD, Hayu, has launched in Australia, with a special focus on reality TV. It is offering a number of programs that are currently available on Foxtel.</p>
<p>The continuing changes will place further pressure on Foxtel’s desire to maintain its current 30% subscription rate in Australia, particularly with the very limited success of Presto.</p>
<h2>Foxtel TV?</h2>
<p>The recent speculation is that Foxtel will release a service similar to Telstra TV. The <a href="https://theconversation.com/up-next-video-on-demand-shakes-up-the-television-industry-45434">Telstra TV</a> service gives you <a href="https://www.telstra.com.au/tv-movies-music/products/telstra-tv">access</a> to all free-to-air catch-up services, three SVoD services, Netflix, Presto and Stan (although does not include subscription fees) and the Roku App Store. </p>
<p>While Telstra has a stake in Foxtel, its Telstra TV service does not include access to Foxtel content, despite T-Box, the service replaced by Telstra TV, which did have access to Foxtel channels.</p>
<p>A Foxtel TV service would directly compete with Telstra TV, and could add to speculation that Telstra wishes to distance itself from Foxtel. </p>
<p>It has been reported that Foxtel is considering including Netflix as part of its streaming service. In addition, Foxtel has made attempts to secure <a href="http://www.news.com.au/technology/home-entertainment/tv/foxtel-reportedly-considering-including-netflix-in-its-own-on-demand-streaming-service/news-story/79a1f8b3ea51273df635889fce43f473">rights deals</a> with the BBC, Viacom and Discovery.</p>
<p>This could see Foxtel become more of a media aggregator, but there still needs to be a differing factor for a Foxtel TV service to succeed. That could lie within the one key area that Foxtel prides itself on - sport.</p>
<h2>Lured back by sports</h2>
<p>Foxtel has secured the <a href="https://theconversation.com/when-the-afl-gets-richer-who-gets-richer-with-it-46321">media rights</a> to many Australian sports, including the AFL and NRL.</p>
<p>Foxtel has also set its sights on Wimbledon, the US Open and The Masters golf tournament, although these are currently restricted and on the legislated anti-siphoning list. This is a list that Foxtel is arguing should be <a href="https://au.news.yahoo.com/a/31152462/foxtel-wants-more-overseas-sports-rights/">abolished</a> with the media ownership laws currently under debate. </p>
<p>Focusing on its dominance in sport and integrating other services like Netflix, could be enough to help Foxtel entice new subscribers or win Australians back to the service.</p>
<p>Netflix has stated previously it is <a href="https://theconversation.com/ten-and-foxtel-in-box-seat-for-next-wave-of-sport-broadcasting-45656">not interested in sport</a>. With the company <a href="https://theconversation.com/netflix-is-everywhere-almost-so-what-does-this-mean-for-local-media-52857">launching globally</a> it would appear its focus for this year will be on building its global market and with this “Netflix Original Content”.</p>
<p>Telstra group managing director for media and marketing, Joe Pollard, stated late last year that “bandwidth is the <a href="http://mumbrella.com.au/why-telstra-tv-will-eat-foxtel-325006">new oxygen</a>”. While Telstra is a key in this supply. Foxtel now is supplying this oxygen to Australia with its new broadband packages, further establishing it as a major competitor to Telstra in more ways that just Telstra TV.</p>
<p>We could see Foxtel supply Australians with an internet service that includes Netflix and the possibility of streaming sport. Foxtel could also use its 13.84% stake in Ten Network as a way to get it involved in the SVoD. Ten the last of the three commercial FTA stations to be involved in a VoD service.</p>
<p>What is very evident by Foxtel’s recent moves, is that sport is the key to obtaining and growing subscriptions. For this reason Foxtel must use its strength in sport to differentiate itself in an Australian SVoD market that is already beginning to feel a little flooded for a population of 24 million.</p><img src="https://counter.theconversation.com/content/56672/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>Foxtel has previously been coy about confirming speculation it is planning to launch a service that will compete with Telstra TV and Apple TV. But new chief executive Peter Tonagh has now told reporters…Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/528572016-01-08T04:26:22Z2016-01-08T04:26:22ZNetflix is everywhere (almost), so what does this mean for local media?<p>In his keynote address at the Consumer Electronics Show in Las Vegas this week, Reed Hastings, Netflix CEO, <a href="http://www.bbc.com/news/technology-35247309">announced that Netflix</a> will now be available in 130 new countries. This sees Netflix more than triple its global presence. </p>
<p>The world map of Netflix availability on the company’s website is now a <a href="https://help.netflix.com/en/node/14164">sea of red</a>. Among the countries yet to have access to Netflix is China, although the company is exploring this. Crimea, North Korea and Syria are also yet to be included due to <a href="https://media.netflix.com/en/press-releases/netflix-is-now-available-around-the-world">United States government restrictions</a>.</p>
<figure>
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<figcaption><span class="caption">Netflix CES 2016 Keynote - Reed Hastings, Ted Sarandos - Highlights.</span></figcaption>
</figure>
<p>So what does <a href="https://twitter.com/search?q=%23netflixeverywhere&src=typd">#NetflixEverywhere</a> – as it was dubbed on social media – mean for the new media landscape globally and in Australia?</p>
<h2>Competitors in the VoD market</h2>
<p>While Netflix’s <a href="http://www.news.com.au/technology/home-entertainment/tv/netflix-have-made-a-huge-new-decision-that-will-change-the-lives-of-millions/news-story/f3df3305c7ac5a751d8c4e3db4cdf364">main video on demand (VoD) competitors</a> are seen to be <a href="http://www.hbo.com/">HBO</a>, <a href="http://www.amazon.com/">Amazon</a> and <a href="http://www.hulu.com">Hulu</a>, their current global reach is small scale in comparison.</p>
<p>Hulu is <a href="http://m.hulu.jp/m/faq/en">only available</a> in the US and Japan. <a href="https://order.hbonow.com">HBO Now</a> is <a href="https://order.hbonow.com/providers">available</a> solely in the US and <a href="http://www.amazon.com/Prime-Instant-Video/b?node=2676882011">Amazon Prime Video</a> is <a href="http://www.amazon.com/gp/help/customer/display.html/ref=help_search_1-1?ie=UTF8&nodeId=201423000&qid=1452156681&sr=1-1">only available</a> to customers located in the US and US territories.</p>
<p>In Australia the main VoD competitors are the locally owned <a href="https://www.presto.com.au/">Presto</a> and <a href="https://www.stan.com.au/">Stan</a>. But the uptake of the locally owned VoD services of only 1%, doesn’t come close to Australia’s uptake of Netflix which by September last year was close to <a href="http://www.adnews.com.au/news/netflix-reaches-2-2m-australians-but-growth-is-slowing-down">10%</a>.</p>
<h2>Netflix original content to be expanded</h2>
<p>Netflix is well known for its original content: <a href="http://www.imdb.com/title/tt2372162/">Orange is the New Black</a>, <a href="http://www.imdb.com/title/tt1856010/">House of Cards</a>, <a href="http://www.imdb.com/title/tt2707408/">Narcos</a>, <a href="http://www.imdb.com/title/tt2431438/">Sense8</a> and Marvel’s <a href="http://www.imdb.com/title/tt3322312/">Daredevil</a> to name a few.</p>
<p>The colossal expansion of Netflix can only provide more opportunity for original content, both globally and within the local market.</p>
<p>In a statement, Hastings <a href="https://media.netflix.com/en/press-releases/netflix-is-now-available-around-the-world">noted</a>:</p>
<blockquote>
<p>We’re looking forward to bringing great stories from all over the world to people all over the world.</p>
</blockquote>
<p>The statement also listed the original content for 2016 to include:</p>
<ul>
<li>31 new and returning original series </li>
<li>24 original feature films and documentaries </li>
<li>a wide range of stand-up comedy specials<br></li>
<li>30 original kids series.</li>
</ul>
<p>It is unclear where this content will be produced, but the Netflix original content will be available at the same time to subscribers everywhere. </p>
<figure>
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<figcaption><span class="caption">Netflix original content.</span></figcaption>
</figure>
<p>Unfortunately not all content available on Netflix will be released globally. </p>
<p>The <a href="http://www.news.com.au/technology/home-entertainment/tv/netflix-have-made-a-huge-new-decision-that-will-change-the-lives-of-millions/news-story/f3df3305c7ac5a751d8c4e3db4cdf364">licensing contract</a> Netflix has with Walt Disney allows the service the rights to Disney films after a theatrical release, but will be limited to only the US and Canada. This shows a clear disconnect between the distribution business models and distribution potential for streaming services.</p>
<p>This staggered release approach is often cited to be part of the reason for high rates of <a href="https://theconversation.com/from-convicts-to-pirates-australias-dubious-legacy-of-illegal-downloading-39912">piracy in Australia</a>, although recently there has been a <a href="https://theconversation.com/why-the-drop-in-illegal-movie-downloads-in-australia-49042">small decline</a>.</p>
<h2>Local impacts</h2>
<p>These limitations on distribution will assist Australian media companies in the rights battle locally, in particular Foxtel. </p>
<p>In the middle of last year, Foxtel’s CEO Richard Freudenstein <a href="http://www.gizmodo.com.au/2015/08/foxtel-ceo-says-netflix-is-like-the-digital-video-store/">said</a>:</p>
<blockquote>
<p>Foxtel is a premium service, which naturally costs a bit more, whereas Netflix and Presto are add-ons either to free to air for people who don’t watch much TV or to subscription TV.</p>
</blockquote>
<p>Despite this claim there has been a large price drop on Foxtel services to compete with the new VoD services.</p>
<p>Netflix is now a global media network with almost full global reach. Last year, prior to the launch in an additional 130 countries, Netflix subscribers <a href="http://www.news.com.au/technology/home-entertainment/tv/netflix-have-made-a-huge-new-decision-that-will-change-the-lives-of-millions/news-story/f3df3305c7ac5a751d8c4e3db4cdf364">watched</a> 42.5 billion hours of content.</p>
<p>It was also revealed that Netflix subscribers are watching on average 13 hours of content on a weekly basis. These hours of viewing are replacing other recreational time, presumably conventional television viewing.</p>
<h2>Viewing habits have already changed</h2>
<p>An analysis of figures from the Australian <a href="http://www.oztam.com.au/whatsnew.aspx">multi-screen quarterly reports</a>, which monitor people’s viewing habits, show there has already been a drop in television viewing hours by Australians, of more than 18 hours per month between 2011 to 2015. In the same period online video viewing has increased by ten hours per month.</p>
<p>If specifically analysing the teen and 18-24 year old demographics the statistics are more damaging for traditional television viewing. Teens on average watch less than half that of the overall Australian monthly average, 38 hours and 18-24 year olds watch 40 hours on average per month.</p>
<p>With regard to online video viewing, teens watch more than double the Australian average, 28 hours, with the 18-24 demographic watching 22 hours per month. Both demographics viewed fewer than five hours of online video in 2011. </p>
<p>With the increase in smart television purchases in Australia, this will provide greater access to VoD services such as Netflix. This is in addition to the services being available via mobile and portable devices. Recently Apple TV used Netflix programming as part of its advertising campaign for the new Apple TV, titled The Future of Television.</p>
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<figcaption><span class="caption">Apple TV Ad.</span></figcaption>
</figure>
<h2>The return of live TV</h2>
<p>For Australian television broadcasters we may see a focus on providing content that Netflix won’t, such as live content. This will include more reality and sport programming. It’s interesting to note then, that television is verging back to a live medium, as it started in Australia almost 60 years ago.</p>
<p>It is clear that Australian viewing habits are continuing to change. Netflix is yet to have its first birthday in Australia, but the 10% uptake is impressive. This is compared to <a href="http://www.afr.com/brand/chanticleer/telstras-penn-facing-technology-tsunamai-20150709-gi8upk">Foxtel’s 30% uptake</a>, for a company that started more that 20 years ago. </p>
<p>With Netflix now “everywhere”, there is potential for Australians to benefit from this, including more content and hopefully more Australian content.</p>
<p>The caution for Netflix must be to provide content for the local markets, not just a one-size-fits-all approach across more than 190 countries.</p><img src="https://counter.theconversation.com/content/52857/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>Netflix took everyone by surprise when it announced it was tripling its global reach for video on demand. So who are the winners and potential losers in the new deal?Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/500692015-11-02T06:15:26Z2015-11-02T06:15:26ZOptus, the new player in Australia’s sports media rights battle<p>In surprising news, Optus has <a href="http://mumbrella.com.au/optus-snatches-broadcast-and-digital-rights-for-english-premier-league-from-fox-sports-328118">secured the media rights</a> to the English Premier League (EPL) for three seasons commencing from the 2016-17 season.</p>
<p>Optus already has the rights for the EPL in its hometown in Singapore. The new deal includes the broadcast and digital rights (broadband and mobile) for all 380 matches broadcast in Australia.</p>
<p>The <a href="http://www.afr.com/business/sport/optus-snatches-australian-english-premier-league-from-fox-sports-20151101-gkocnf">Optus bid</a> is rumoured to be more than double the A$20-25 million paid by Fox Sports currently. This is a significant investment by Optus and gives a clear indication it wishes to be part of media distribution in Australia, particularly sports.</p>
<p>Optus CEO Allen Lew <a href="http://www.adnews.com.au/news/optus-wins-exclusive-broadcast-and-digital-rights-to-the-barclays-premier-league">said</a>:</p>
<blockquote>
<p>“We are dedicated to delivering the best domestic and international entertainment for our customers. With 930 million followers worldwide, the Premier League is one of the most sought after sports properties for content providers.”</p>
</blockquote>
<p>This is a significant defeat for Fox Sports, which has seen the EPL as a <a href="https://www.foxtel.com.au/watch/epl.html">flagship</a> for its programming lineup.
This will see an end to Foxtel’s almost 20 year association with the league, which began in 1997. Foxtel is yet to release a statement, although it quickly removed the story discussing the deal from its website after it was posted at <a href="http://www.foxsports.com.au/football/optus-to-broadcast-epl-in-australia/story-e6frf423-1227590580615">foxsports.com.au</a>.</p>
<h2>Where will Optus broadcast in Australia?</h2>
<p>Much of the discussion about the Optus EPL deal has been on who will broadcast the games, given Optus is not a traditional broadcaster. </p>
<p>There are a few options Optus could take to utilise the EPL media rights. A deal to on-sell them to Foxtel is extremely unlikely. There are other options that Optus could establish, which would see them in a position to compete with Foxtel, in particular FoxSports. These developments could see a shake up for future sports media rights in Australia and also the way in which sports is distributed. </p>
<p>Optus also has the digital rights, an increasingly important part of all sports media rights deals. It could be that the EPL is offered by Optus as an additional subscription channel on FetchTV, its streaming service that competes with Telstra TV and Foxtel streaming services. FetchTV can now be bought outright at many electronics stores, and could see an increase in uptake if Optus were to open the subscription access to all FecthTV customers. </p>
<p>In addition to the streaming of EPL games, Optus could utilise its strength as a telecommunications company and supply a “Live Pass” version of the games. This is comparable to the AFL and NRL Live pass streaming services, where the rights are currently held by Telstra.</p>
<p>Optus may also enable SBS to broadcast some of the games on the free-to-air station, similar to the arrangement between Foxtel and SBS.</p>
<h2>Future of sports rights in Australia</h2>
<p>“Optus has never been in sports rights and we’re now in the game,” said CEO Allen Lew, not after this latest EPL deal, but one that appears to have passed many without notice. </p>
<p>Last month Cricket Australia <a href="http://www.cricket.com.au/news/cricket-australia-optus-deal-live-streaming-test-series-classic-matches-highlights/2015-10-22">announced</a> a three-year deal with Optus as its “<a href="http://www.cricketaustralia.com.au/about/partners/commercial">Official Mobile Media Partner</a>”. This will not only see Optus customers get free access to <a href="http://www.optus.com.au/shop/entertainment/cricket?CID=part:con:ca:careg:perks:enter:sport:claim&utm_source=ca&utm_medium=part&utm_campaign=partcaregperks&utm_content=sport">Cricket Australia’s Live Pass</a>, but also exclusive content for Optus customers, which includes historic matches.</p>
<p>The next move made by Optus could be associated with the NRL media rights. Both Foxtel and Telstra are yet to agree to a new NRL deal. Optus may secure a deal with the NRL that would see it acquire the rights that both Foxtel and Telstra currently have. This would further entice new subscribers to its Internet Service Provider (ISP) services.</p>
<h2>The battle of the ISP and sport</h2>
<p>It’s clear that Optus’ intention from these new media deals is to entice new customers to come across to its mobile and broadband services. Part of this may be to counter the recent move by Foxtel to become an ISP with packages that <a href="https://www.foxtel.com.au/get/broadband-bundles.html?SEMFOXTEL&gclid=CjwKEAjw8NaxBRDhiafR-uvkpywSJAAxcl6f-N2wKgcCuDb4sZKPuz8lCFodncfpXukQTvR5S8heJxoClhjw_wcB&gclsrc=aw.ds">bundle in</a> its pay television services.</p>
<p>With the sports deals Optus has secured it is not only taking on Foxtel, but also Telstra. These deals, particularly the EPL deal, add competition to a market dominated by the latter two interlinked media giants. It could potentially add choice for Australian consumers, or alternatively fragment the sports media landscape in Australia, frustrating consumers further than they already are.</p><img src="https://counter.theconversation.com/content/50069/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station)</span></em></p>As Optus takes the fight for sports viewers to Foxtel and Telstra, it’s unclear if consumers will benefit.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/463212015-08-20T00:47:18Z2015-08-20T00:47:18ZWhen the AFL gets richer, who gets richer with it?<p>Tuesday’s A$2.508 billion AFL rights deal is being heralded as <a href="http://www.afl.com.au/news/2015-08-18/afl-on-the-verge-of-signing-new-tv-deal">“colossal”</a>, but while it surpasses that of previous deals, it is still far from that seen abroad. Last year’s <a href="http://www.wsj.com/articles/nba-media-partners-defend-rights-deal-1412638278">nine-year NBA deal</a>, for example, was valued at US$24 billion, with pay TV provider Time Warner one of the biggest winners. </p>
<p>Sporting rights could be the last big money spinner for pay TV broadcasters, due to the fact that consumers watch sports live. This gives the broadcasters an opportunity to present advertisements to a mass audience simultaneously, something which has become harder for the broadcasters in a fragmented media environment. </p>
<p>The value of live sport could have been why News Corp executive chairman Rupert Murdoch showed up at the announcement. Murdoch made News Corp’s <a href="http://www.afl.com.au/news/2015-08-18/afl-on-the-verge-of-signing-new-tv-deal">position</a> clear: </p>
<blockquote>
<p>“This is a very significant investment for us, we’ve always believed that this is the premium code in Australia, it’s the national game…Were also committing all of our platforms to support the AFL everywhere, in every state. We are are very happy to be doing this, we believe in the strength of the game and we will do everything to make it stronger”.</p>
</blockquote>
<p>The A$2.508 billion deal, which runs from 2017 to 2022, includes buy-in from Seven, News Corp and Telstra. Unlike the NRL, which only announced part of its expected deal, the AFL waited until all parties were signed and present.</p>
<p>The annual value of the AFL broadcast rights continues to grow, keeping in mind more recent deals have included pay and digital rights. The rights of 1971-75 were valued at A$200,000, 1988-92 A$6 million per year, 2002-06 A$100 million per year, with the current rights valued at A$250 million. The new rights deal adds almost A$170 million per year. </p>
<p>The new six-year deal includes the same media organisations – Seven, News Corp and Telstra, that are involved in the current five-year A$1.25 billion rights arrangement. The deal has exceeded expectations, with one analyst <a href="http://www.theage.com.au/afl/afl-news/seven-to-remain-sensible-in-afl-broadcast-rights-bid-20141104-11gmym.html">predicting last year</a> it was likely to fall short of the A$2 billion mark.</p>
<p>As part of the new deal Seven will broadcast games in HD, though it hasn’t gained the same streaming rights that the Nine Network did for the NRL. Instead the digital rights were again secured by Telstra.</p>
<p>News Corp’s Fox Sports will have the rights to broadcast all games across the season with the exception of the grand final. As part of the agreement, Fox Sports can sub-licence the 3.20pm Saturday game to a free-to-air provider. It is highly likely this will be offered to Network Ten, which has recently become <a href="https://theconversation.com/sport-the-crunch-point-for-regulator-in-foxtel-ten-deal-45238">closely aligned with Foxtel</a>. If the game was offered to Network Ten, it would see the network <a href="http://www.theage.com.au/afl/afl-news/seven-to-remain-sensible-in-afl-broadcast-rights-bid-20141104-11gmym.html">again</a> involved with the AFL, as it was during 2002-2011. </p>
<p>Unlike Seven, Foxtel has gained rights to broadcast across all devices which could create both competition and some unclear expectation of how the digital rights are defined.</p>
<h2>Digital rights</h2>
<p>While Telstra has secured the digital rights, Foxtel has said: </p>
<blockquote>
<p>“Under this deal, for the first time, Fox Footy will be able to be broadcast on all devices, which means that if you subscribe to Foxtel Play or use Foxtel Go, you’ll now be able to watch all games on PCs and Macs as well as tablets, phones and games consoles.”</p>
</blockquote>
<p>Foxtel has also <a href="http://mumbrella.com.au/foxtel-and-seven-telstra-tie-up-afl-rights-in-2-5bn-deal-313048">stated</a>: </p>
<blockquote>
<p>“If you love AFL you need to be a Foxtel subscriber, and with our recently reduced pricing there’s really no reason not to sign up.”</p>
</blockquote>
<p>But it is unclear if the pricing will change from the current structure. The current pricing of the Foxtel Play service is A$25, the sports package is an additional A$25, making the total A$50 per month. It should also be noted that currently the FootyPlay service is not available via Mac/PC, although based on the statement above this will change for the new rights. </p>
<p>So if Foxtel will be streaming all games how does this play against Telstra’s digital rights?</p>
<p>We’re yet to see how Telstra will deliver on its promise to “transform the experience” for AFL fans, and there are already <a href="https://theconversation.com/new-gadgets-and-gimmicks-to-keep-us-watching-sport-live-on-tv-36138">alternative options</a> in the way in which sport could be presented to an audience. It is a case of seeing whether Telstra will utilise any of these or new technologies that will be released between now and when the rights commence in 2017.</p>
<p>In comparison to the Foxtel option the <a href="http://www.afl.com.au/livepass/afl-tv">AFL Live Pass</a> currently costs consumers A$89.99 for an annual pass, although there is currently no Apple AirPlay or Google Chromecast option to stream to a TV. A TV <a href="http://mumbrella.com.au/foxtel-and-seven-telstra-tie-up-afl-rights-in-2-5bn-deal-313048">streaming option</a> will be available with the new rights via Telstra TV, a new service it will launch in September.</p>
<p>It is clear that Foxtel and Telstra will be competing for subscriptions for the services. </p>
<h2>Where’s the future?</h2>
<p>AFL CEO Gillon McLachlan <a href="http://www.afl.com.au/news/2015-08-18/afl-on-the-verge-of-signing-new-tv-deal">says</a> the new deal will allow for growth in the game to “create new generations of supporters, members, players and volunteers”.</p>
<p>The growth in the game was made clear over the weekend when the <a href="http://www.theage.com.au/afl/afl-news/more-watched-womens-footy-on-tv-than-bombers-demise-20150817-gj0zbj.html">women’s game</a> between Melbourne and Western Bulldogs averaged an audience in Melbourne of 175,000, in comparison to the Essendon game which averaged 114,000.</p>
<p>These games are not part of the new AFL broadcast rights deal. Despite this Seven West Media CEO Tim Worner has <a href="http://www.abc.net.au/radio/programitem/peZWDEWrRQ?play=true">publicly expressed</a> an interest. Given the ratings acquired by the women’s game, it could a tempting alternative for other broadcasters, both free-to-air and subscription. </p>
<p>The high level of interest shown toward the women’s game shows the AFL is expanding and that the broadcasts should expand with it. In the future there could be a secondary agreement associated with the new rights. Seven and Foxtel could broadcast the games via its joint venture, video on demand (VoD) streaming service Presto, to <a href="https://theconversation.com/ten-and-foxtel-in-box-seat-for-next-wave-of-sport-broadcasting-45656">differentiate</a> it from the VoD leader Netflix.</p>
<p>The alternative is a new class of media rights which includes the women’s games along with other exhibition and international AFL games. These rights could be acquired by Ten or Nine, or could allow <a href="https://theconversation.com/youtube-could-change-the-way-we-broadcast-sport-in-australia-43332">new players</a> like YouTube to become involved in the broadcast of AFL. </p>
<p>The decision by Telstra to continue to obtain the digital rights for the AFL also raises questions about the NRL digital rights. Will Telstra bid for these or could we see <a href="https://theconversation.com/youtube-could-change-the-way-we-broadcast-sport-in-australia-43332">new players</a> in the market to broadcast NRL games across digital streaming platforms?</p><img src="https://counter.theconversation.com/content/46321/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).
</span></em></p>Telstra is promising to “transform the experience” for AFL fans, but Foxtel has similar plans.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/460742015-08-14T03:08:27Z2015-08-14T03:08:27ZFoxtel boxed into a corner as sport streaming takes hold<figure><img src="https://images.theconversation.com/files/91731/original/image-20150813-21416-1xkbwqk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Sports viewing: TV no longer required.</span> <span class="attribution"><span class="source">Image sourced from Shutterstock.com</span></span></figcaption></figure><p>The Nine Network this week <a href="http://www.smh.com.au/business/media-and-marketing/nine-holds-onto-nrl-television-rights-20150809-giva5s.html">secured</a> the broadcast rights for the NRL, in a five year deal to start from 2018. This has removed the possibility of Foxtel and Ten establishing a <a href="https://theconversation.com/ten-and-foxtel-in-box-seat-for-next-wave-of-sport-broadcasting-45656">combined bid</a> for NRL, although the AFL rights are yet to be confirmed.</p>
<p>The deal will see Nine pay A$185 million annually for the <a href="http://www.smh.com.au/business/media-and-marketing/nine-holds-onto-nrl-television-rights-20150809-giva5s.html">NRL rights</a>, which some argue will see Nine not place a bid for the new AFL rights. The amount Nine will pay could be lower if the NRL allows pay simulcasts of games, although Foxtel has not yet confirmed its interest.</p>
<p>Former NRL adviser Colin Smith <a href="http://www.theaustralian.com.au/sport/nrl/nrl-broadcast-rights-fox-snub-puts-cash-target-in-doubt/story-fnca0von-1227479489625">was unimpressed, saying</a> the rights deal announced by Nine and the NRL was disrespectful toward Fox Sports, a long-term broadcaster, and left them with “crap content”. He says the the public announcement of the deal, before “ever going to market properly”, could make it more difficult for the NRL to secure a deal with Foxtel.</p>
<h2>Digital is the future</h2>
<p>One of the biggest surprise shifts to come from the new deal is associated with digital rights. As part of Nine’s deal it has secured the streaming rights, with no confirmation how this will impact the previously titled “digital rights”. </p>
<p>It comes as Telstra this week revealed growth in <a href="http://www.telstra.com.au/uberprod/groups/webcontent/@corporate/@about/documents/document/uberstaging_296433.pdf">streaming</a> of both AFL and NRL games which “increased by over 70 per cent and 100 per cent respectively in the past year”.</p>
<p>Nine boss David Gyngell has said the NRL deal is <a href="http://www.smh.com.au/business/media-and-marketing/nine-holds-onto-nrl-television-rights-20150809-giva5s.html">“transformational”</a> because it enables “viewers to see the best of the NRL, live and free, four days per week, anywhere, on any device”.</p>
<p>This statement in itself shows commercial television broadcasters are no longer solely concerned about TV content being viewed on TV sets. Content is king, regardless of the platform it is viewed upon. It also shows that live sport, as many have already argued, will be a key contributor in the future success of free-to-air broadcasters, particularly in Australia.</p>
<h2>What about digital rights?</h2>
<p>If Nine is to hold the streaming rights, what does this means for the digital rights currently held by Telstra?</p>
<p>It appears from the NRL’s CEO, Dave Smith, that digital won’t be segregated in the same way it has for previous rights deals. Smith <a href="http://www.smh.com.au/business/media-and-marketing/nine-holds-onto-nrl-television-rights-20150809-giva5s.html#ixzz3ieuPHylV">says:</a></p>
<blockquote>
<p>“By 2018, the digital world will be very different and we want to be in the best possible position to take advantage of any changes. So negotiations with the pay-TV and digital providers will continue and, again, our focus will be on ensuring the most widespread coverage on whatever platform fans choose to watch rugby league.”</p>
</blockquote>
<p>Recent reports are making it unclear as to how Telstra will approach the new rights of both the NRL and AFL. It has been <a href="http://www.afr.com/business/telecommunications/telstra-backs-off-from-bigbucks-sports-rights-20150807-gitue9">reported</a> that Telstra will pull back from paying any big fees to gain the rights for both codes. In addition, it could be that Telstra doesn’t make a bid at all, yet could still be able to stream games via its services.</p>
<h2>Sports subscriptions</h2>
<p>There are various ways Telstra could still stream games, if they were not bid for the rights. The first would include Foxtel, which Telstra has a 50% share in. If Foxtel were to make an agreement with the NRL for broadcast rights, Telstra could provide the stream to its customers via the <a href="http://www.foxsports.com.au/mobile">Foxtel Sports app</a>.</p>
<p>Another option relates to Nine and the way in which it may utilise its rights to stream NRL games. Nine is currently involved in two online ventures that could be utilised for streaming of the games – 9Jumpin, which is the networks catch-up TV service and also Stan, its video-on-demand service; a joint venture with Fairfax Media. </p>
<p>Stan is currently struggling to compete with the other major video-on-demand (VoD) service, Netflix. To ascertain a point of difference, the streaming of games in addition to other exclusive content via Stan, could give the service the difference needed to claw back some of the lead gained by Netflix. Netflix has said it is <a href="https://theconversation.com/ten-and-foxtel-in-box-seat-for-next-wave-of-sport-broadcasting-45656">not interested in live sport</a>. </p>
<p>The VoD service Presto could also take the same approach, with its joint partners Foxtel and Seven. Foxtel has used Presto subscription figures to lift its <a href="http://mumbrella.com.au/foxtel-admits-subscriber-figures-include-presto-users-but-claims-cable-still-biggest-growth-driver-311968">overall result</a>. It could use Presto to stream the NRL content if it was to obtain the rights. This may provide fewer issues, than Nine and Stan, due to Nine’s rights associated with free-to-air, where as Foxtel and Presto are both subscription services. </p>
<p>But how would this help Telstra?</p>
<h2>Telstra the all-in-one provider</h2>
<p>Telstra has recently announced <a href="https://theconversation.com/up-next-video-on-demand-shakes-up-the-television-industry-45434">Telstra TV</a>, and has been in negotiations with the three prominent VoD providers, Presto, Stan and Netflix to have all three services available via this new service. </p>
<p>This could see Telstra take on a role as a media aggregator, a role used to describe itself in its <a href="http://www.telstra.com.au/uberprod/groups/webcontent/@corporate/@about/documents/document/uberstaging_296433.pdf">2015 annual report.</a></p>
<p>Telstra says:</p>
<blockquote>
<p>“Rather than restrict our customers’ choices, we are open to hosting all Subscription Video on Demand services on our platforms and making it easy
for them to get all the content they want in the one place.”</p>
</blockquote>
<p>This could see Telstra less focused on obtaining the digital rights themselves, but rather providing the digital rights holders alternative platforms for content distribution.</p>
<p>The announcement of the NRL rights with Nine and the lack of clarity for any additional bidders raises many questions for the future of sports broadcasting and the rights in Australia. Could it be the sporting organisations themselves that obtain the digital rights and provide the services currently provided by Telstra, removing the middle man? </p>
<p>The urgency by Nine and the NRL to announce the rights deals, of which only part has been confirmed, is also questionable. The NRL rights will not start until 2018. This is a year later than the AFL’s, which is yet to announce any of its rights agreements or any make any suggestions of deals. </p>
<p>The announcement this week could impact the new AFL rights and its yet to be seen if it will be a positive or negative one. What the announce does signal is a change in the way in which Australians will view sport in the future.</p><img src="https://counter.theconversation.com/content/46074/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>Commercial television broadcasters are no longer solely concerned about TV content being viewed on TV sets.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/458342015-08-10T05:51:49Z2015-08-10T05:51:49ZFoxtel’s bundle of pain could come sooner than it thinks<p>Most media businesses offer a bundled set of products. When you buy the newspaper, or watch free-to-air TV, this is obvious. You pay a fee to buy a newspaper, or the offerings of a channel, some of which you want and some you don’t want, but it all comes together in a package. You can pick and choose some content by switching TV channels or subscribing to more than one newspaper, but your choice is quite limited.</p>
<p>Pay TV offers a slightly broader bundle. You subscribe to a package from Foxtel and you get access to more channels, and hence can choose between a wider range of content, but it is still a bundled offering. You pay through a subscription rather than by watching advertisements, which makes the business model slightly different, but you are still offered a bundle.</p>
<p>This whole business model is now under challenge; for newspapers, TV channels and for pay TV. The share prices of media companies are in decline, and in the US <a href="http://www.reuters.com/article/2015/08/05/us-usa-media-idUSKCN0QA2BS20150805">in sharp decline.</a></p>
<p>The challenge so far has been gradual as technology has allowed consumers progressively more control. Technology has worked to undercut the pre bundled business models: videos allowed people alternatives as to how to be entertained in their homes, time-shifting gave them greater control over when they watched programs, and the web gave them news whenever they wanted.</p>
<p>Netflix and similar businesses now have pushed the envelope further. They offer access to a wide range of content cheaply and at the viewers’ preferred time. This is part of a broad movement – web based services are undermining the business models of all the product bundlers, from newspapers onwards.</p>
<p>Increasingly we are able to pick and choose the content we want to watch, the time we want to watch it, and to pay just for what we want. Music has gone the furthest down that path.</p>
<p>Where does it all end? It seems likely that a range of offerings will survive. Some completely bundled products like newspapers will survive at one end, and some smorgasbord offerings like Netflix and Spotify will be at the other. In between they will probably be a range of partly bundled services of the sort Foxtel offers. Just as restaurants exist which offer a diversity of product mixes so entertainment is likely to finish up in the same place.</p>
<p>Businesses will adapt, some will fail. To survive they have to find a mix of price, product offering, and availability which is viable.</p>
<h2>Pay TV to pay the highest price</h2>
<p>Sitting in the middle, pay TV however looks particularly vulnerable. It took market share from free-to-air TV because it offered a wider range of advertising-free content, but it’s not clear how big the market is now that it is challenged by offerings which offer still more choice.</p>
<p>Free-to-air seems most likely to encroach onto the territory of pay TV. A <a href="http://www.buseco.monash.edu.au/assets/documents/reforming-freetoair-broadcasting.pdf">recent Monash Business Policy Forum paper</a> argues free-to-air providers need to separate their control of the spectrum from their provision of content, selling space on the spectrum to a wider range of content providers – a little like a department store allowing product manufacturers space on their shop floors. With digitisation the spectrum operators have the ability to offer a much wider range of content than they currently do.</p>
<p>As free-to air expands, pay TV’s only real option seems to be to cut price and expand options available to customers. Some of this is underway and more is likely. It is a costly strategy.</p>
<p>Content providers should be winners. As prices fall and choice widens, there will be a more intense struggle for content which attracts eyeballs. Some will be political and some economic. There will be political pressure to broaden the anti-siphoning rules which require some premium sporting events to be available on free-to-air, allowing them to charge premium advertising rates for major events. </p>
<p>And other content which is attractive will command higher prices; good for providers like the AFL or FFA. It also means that programs will have to stand on their own merits, and command a commensurate price. The whole business of cross-subsidies from one program to another will be minimised. Higher prices for content will squeeze the profitability of media companies even further as their programming costs rise while their revenue is under challenge.</p>
<p>Such unbundling of media is good for the consumer. Rather than being forced to watch the standard (and parallel) programming of the free-to-air channels, we now are more able to watch what we want when we want it.</p>
<p>There will be considerable pressure for media laws to change. The current rules are based around media technologies which are well out of date. We failed to make the necessary changes when we digitised the system but economic forces will now ensure it happens.</p><img src="https://counter.theconversation.com/content/45834/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Rodney Maddock is affiliated with the Economic Society of Australia.</span></em></p>The unbundling of content stands to hurt Pay TV providers the most.Rodney Maddock, Vice Chancellor's Fellow at Victoria University and Adjunct Professor of Economics, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/456562015-08-05T20:17:32Z2015-08-05T20:17:32ZTen and Foxtel in box seat for next wave of sport broadcasting<figure><img src="https://images.theconversation.com/files/90856/original/image-20150805-22474-15j9haa.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Image sourced from Shutterstock.com</span></span></figcaption></figure><p>One of the most interesting elements of the upcoming sporting <a href="http://mumbrella.com.au/reports-nrl-rights-to-spiral-to-1-7bn-with-ten-tipped-to-pick-up-a-match-from-fox-sports-309768">broadcast rights deals</a> is that they won’t kick off for two years and look likely to last for five.</p>
<p>Can we really look so far into the future to understand what both free-to-air and pay television will look like in two years in a media environment so filled with uncertainty?</p>
<p>Foxtel is no doubt hoping it can as it positions itself for a range of different scenarios.</p>
<p>It’s <a href="http://www.dailytelegraph.com.au/sport/nrl/nrl-tv-rights-the-17-billion-broadcast-deal-that-will-transform-rugby-league/story-fnp0lyn3-1227468567930">rumoured</a> that the new NRL rights deal could be worth as much as A$1.7 billion, a large increase on the A$1 billion for the previous deal. </p>
<p>The AFL and NRL are both set to strike five year rights deals, with the AFL’s to run from 2017 to 2021 and the NRL from 2018 to 2022.</p>
<p>While some argue that the Nine Network will retain the free-to-air rights for the NRL, the recent <a href="https://theconversation.com/sport-the-crunch-point-for-regulator-in-foxtel-ten-deal-45238">Foxtel share purchase into Ten</a> could see the two establish a combined deal. This would see Foxtel and Ten make <a href="http://mumbrella.com.au/reports-nrl-rights-to-spiral-to-1-7bn-with-ten-tipped-to-pick-up-a-match-from-fox-sports-309768">one sole bid</a> for the rights for each of the codes, controlling the way sport is distributed.</p>
<h2>Live sport is king</h2>
<p>Analyst firm UBS <a href="https://theconversation.com/tv-shifts-from-hero-to-zero-but-even-netflix-cant-kill-pirating-45087">recently</a> placed a halt on any growth by the free-to-air Australian television networks in the coming year. It cited Netflix and its rapid growth in uptake locally as a key indicator. </p>
<p>Despite being a threat to the current television entertainment broadcast model, Netflix appears disinterested in sport. Netflix has continually made it clear that it doesn’t see its future in live streaming and in particular sports, without ruling it out. In the company’s <a href="http://files.shareholder.com/downloads/NFLX/0x0x821953/CA9EDA04-D2BD-493F-A6E2-D83AA962C426/NFLX-Transcript-2015-04-15T22_00.pdf">earnings call</a> earlier this year the message was the same.</p>
<p>Ted Sarandos, Netflix chief content officer, stated:</p>
<blockquote>
<p>“I think part of our core <a href="http://files.shareholder.com/downloads/NFLX/0x0x821953/CA9EDA04-D2BD-493F-A6E2-D83AA962C426/NFLX-Transcript-2015-04-15T22_00.pdf">consumer proposition</a> is on demand. We make viewing certain kinds of content better, because they’re on demand.
And I don’t know that on demand sports is markedly better than live sports.
So that’s why we haven’t been that excited about it. Why we haven’t chased it. There’s economic reasons as well. I think in general, that sports is great for live television.”</p>
</blockquote>
<p>Reed Hastings, Netflix CEO, has also weighed into the discussion:</p>
<blockquote>
<p>“If we can anchor the entertainment side for movies and TV shows for every consumer and somebody else, or other set of leagues, anchor the sports part, which is still over the Internet, then the Internet TV proposition is even more powerful for consumers.”</p>
</blockquote>
<p>Telstra too, during its <a href="https://theconversation.com/up-next-video-on-demand-shakes-up-the-television-industry-45434">announcement</a> for <a href="https://theconversation.com/telstra-on-the-tv-casting-couch-to-trump-its-telco-peers-45362">Telstra TV</a>, said live sports would be a key reason for customers to stay with free-to-air and pay TV (Foxtel) in Australia.</p>
<p>This raises a few questions in regards to Australian sport broadcasting rights.
Who could or in fact will be, that “somebody else” that Netflix suggests, and how will it change the way sports are broadcast to Australians in the future?</p>
<h2>Digital rights</h2>
<p>Telstra currently holds digital rights for both the NRL and AFL. In addition, both leagues also provide live streaming of games via smartphone and tablet apps, in conjunction with Telstra. Arguably it will be the digital rights that will be closely looked at as part of the new rights agreements. </p>
<p>This is due to the change of focus by the Australian television industry in relation to distribution via digital platforms. All free-to-air networks have catch-up services available and two of the three commercial free-to-air networks are involved with video-on-demand (VoD) services. This shows some of the older players have begun to adapt to the <a href="https://theconversation.com/up-next-video-on-demand-shakes-up-the-television-industry-45434">changing media landscape </a>.</p>
<h2>Foxtel + Ten = sport</h2>
<p>Foxtel’s share purchase of Ten raises some very interesting questions as to the future for both Ten and Foxtel, particularly for sport broadcasting in Australia.</p>
<p>Netflix is clearly leading the VoD space in Australia. Both Seven and Nine have stated their intention to be in the space, with respective joint ventures in Stan and Presto. Foxtel is partnered with Seven West Media on Presto, and has also <a href="http://www.tvtonight.com.au/2015/06/ten-looks-to-join-presto.html">offered Ten</a> a 10% stake in Presto. Nine has partnered with Fairfax on Stan. But both services are well behind Netlix and it’s unclear if both will survive in the future.</p>
<p>Ten is yet to move into the VoD environment. The market is arguably already flooded, and still <a href="https://theconversation.com/tv-shifts-from-hero-to-zero-but-even-netflix-cant-kill-pirating-45087">harmed by piracy</a>. Ten could use its now strong association with Foxtel to establish a live streaming and VoD service that is focused on sport. This is a market not established in Australia, and due to the “live” element, not harmed by piracy. </p>
<p>This could also become part of the broadcast rights that Foxtel and Ten present to the AFL and NRL; to incorporate the digital rights. A move like this would potentially remove Telstra, a 50% stakeholder in Foxtel, as the digital rights holder for the two codes. </p>
<p>Ten has already attempted a sports only channel, OneHD, but it failed. There are now more advantages and options for it to realign its focus with sport once again.</p>
<p>Not only would the new services work for the large sporting leagues, like the AFL and NRL, there’s also potential for minor sports codes, some of which were axed by the ABC recently due to <a href="http://www.abc.net.au/news/2014-11-24/abc-to-axe-coverage-of-local-sports-as-part-of-budget-cuts/5914336">budget cuts</a>.</p><img src="https://counter.theconversation.com/content/45656/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott is a board member of C31 Melbourne (Community Television Station).</span></em></p>Media players are jostling for a piece of the lucrative sports broadcast market, but a lot can happen in two years.Marc C-Scott, Lecturer in Screen Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/453622015-07-31T03:56:14Z2015-07-31T03:56:14ZTelstra on the TV casting couch to trump its telco peers<figure><img src="https://images.theconversation.com/files/90371/original/image-20150731-10542-1tvkjle.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">TVappa</span> <span class="attribution"><span class="source">Image sourced from Shutterstock.com</span></span></figcaption></figure><p>What we used to call television is changing before our eyes. </p>
<p>This week, Telstra announced it will shortly introduce a new streaming video set top box. For a number of reasons, this is a very smart move. </p>
<p>Australia’s largest media and telecommunications company has responded quickly to a series of local developments in a way that seems likely to consolidate its market-leading position. It is targeted at the 70% of Australian households that continue to resist signing up to Foxtel’s pay television service. </p>
<p>Some see this as as another <a href="http://www.smh.com.au/business/telstra-launches-roku-to-take-on-apple-and-google-20150728-giltvh.html">nail in pay TV’s coffin</a>, and an indication that Telstra is having an each way bet on the future of television given its 50% stake in Foxtel. </p>
<p>Others say it could benefit the beleaguered commercial free-to-air incumbents and <a href="http://www.theaustralian.com.au/business/netflix-faces-fightback-from-telstra-tvs-coalition/story-e6frg8zx-1227462267116">“check Netflix’s encroachment”</a>. The argument here is that the subscription video on demand (SVOD) services of the free-to-airs will be able to leverage Telstra’s customer base - 3 million broadband subscribers, or over 40% of the Australian market - and use Telstra’s well-developed billing and customer service operations to their advantage. </p>
<p>Telstra TV has already claimed one casualty, however. Telstra’s T-Box personal video recorder will cease to be sold, although the company is promising to continue to support its existing 800,000 users.</p>
<p>In September this year, Telstra plans to make the Roku 2 set top box available to subscribers to its Bigpond broadband service. The new platform strengthens Telstra’s greatest competitive advantage - its capacity to offer bundled services combining home phone, mobile, broadband, pay-television and SVOD. </p>
<p>While it is similar in look and feel to the Apple TV box, the Roku 2 is a much more open system. Its US and UK versions boast thousands of apps and many more services than Apple’s equivalent. Its interface is customisable, and it allows users to search for films or content across multiple services simultaneously. </p>
<h2>Piracy not required</h2>
<p>This may prove to be a major selling point, particularly if all three of the main SVOD services - Netflix, Stan and Presto - are offered on the new Telstra TV box. It may also address one of the industry’s major bugbears: content piracy. After the Copyright Amendment (Online Infringment) Act entered into law in June, <a href="https://theconversation.com/there-are-better-ways-to-combat-piracy-than-blocking-websites-43701">commentators argued</a> that making content more easily accessible could do more than blocking infringing websites in preventing piracy. </p>
<p><a href="https://www.communications.gov.au/sites/g/files/net301/f/DeptComms%20Online%20Copyright%20Infringement%20Report%20FINAL%20.pdf">A recent survey conducted for the federal Department of Communications</a> covering the three months just before Netflix launched in March estimated that roughly a quarter of Australian internet users over the age of 12 had streamed or downloaded content illegally. Of those surveyed who admitted to illegally accessing content, almost 40% said they would stop if content was cheaper. </p>
<p>Almost 40% said they would stop if more legal content was available. And more than 60% said they would sign up to a (legal) movie subscription service if it was priced at $10 or less per month. The SVOD service Stan costs $10 per month, while Netflix is currently $9. It is therefore conceivable that, as in the UK, easier access to content through SVOD services and platforms like Telstra TV, may well lead to a reduction in piracy.</p>
<h2>Foxtel and sport in sight</h2>
<p>As the Telstra TV announcement indicates, the popularity of new SVOD services is clearly having an impact on free-to-air and pay television companies’ business models and strategies. Telstra has a 50% stake in Foxtel, the company <a href="https://theconversation.com/is-foxtel-most-at-risk-in-the-new-game-of-screens-39783">that may be most at risk</a>. In June, Foxtel made a bid for 15% of Channel Ten, shortly after the latter’s CEO warned that falling advertising revenues could see free-to-air fold. </p>
<p>Foxtel’s move - widely considered to have been instigated by its other major stakeholder, Rupert Murdoch’s News Corp - will potentially allow Ten’s content to be included on Foxtel and Seven West’s flagging SVOD service, Presto. It could also place the three partners in the box seat to acquire the rights to major sports events, subject to the approval of various regulatory bodies.</p>
<p>And despite Telstra’s protestations that its interests in sports rights are confined to mobile, the Telstra TV box could indeed provide a platform for the company to launch future bids for online rights to major events. It has already been suggested that a “sports pass” will be offered to Telstra TV users that will provide access to Fox Sports channels. On one hand this could boost viewers of Foxtel’s flagship sports channels. On the other, it represents a further unbundling of the pay television service.</p>
<p>More than anything, though, the Telstra TV announcement reaffirms the company’s ambitions to be a major player in service provision, if not in content production. Just a few days ago, shareholders in the second largest Australian Internet Service Provider, iiNet, voted to approve a merger with the third largest ISP, TPG. The merged company will still have a smaller subscriber base than Telstra’s Bigpond, but it is a significant statement of Telstra’s intent that it has so quickly moved to unveil this new offering.</p><img src="https://counter.theconversation.com/content/45362/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben Goldsmith does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Telcos are positioning themselves to be at the top rather than the bottom of the content food chain.Ben Goldsmith, Senior Research Fellow , Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/452382015-07-28T04:06:38Z2015-07-28T04:06:38ZSport the crunch point for regulator in Foxtel-Ten deal<p>Foxtel’s <a href="http://www.abc.net.au/news/2015-06-15/foxtel-takes-15pc-stake-in-ten/6546298">proposal</a> to acquire up to 15% of Ten Network Holdings for A$77 million would further complicate the already very complex ownership structure in Australia’s media landscape.</p>
<p>The deal looks set to receive some serious scrutiny from the Australian Competition and Consumer Commission. ACCC Chairman Rod Sims has said the regulator will <a href="http://www.abc.net.au/news/2015-07-27/ten-ceo-hamish-mclennan-resigns/6650192">look at all Murdoch family interests</a> as it considers whether the deal could lessen competition. Rupert Murdoch’s News Corporation owns a 50% stake in Foxtel, and Murdoch’s son Lachlan an 8.5% share of Ten.</p>
<p>The proposal would see Foxtel acquire up to 15% of Network Ten while Ten would acquire up to 24.99% of Multi Channel Network (MCN). MCN is a supplier of advertising opportunities across a number of subscription television channels and is currently owned by Foxtel and Fox sports. Ten also has an option to acquire 10% of Presto, which is a subscription video on demand service. Presto is a joint venture between the Seven Network and Foxtel.</p>
<p>The main issue is likely to be concern over potential bids for premium sporting content and what a Foxtel-Ten tie up might mean for other free to air competitors.</p>
<h2>Muddy waters</h2>
<p>A media merger in Australia faces two sets of hurdles. It must satisfy the merger laws administered by the ACCC designed to protect competition, and it must also satisfy various diversity rules administered by the Australian Communications and Media Authority (ACMA).</p>
<p>The diversity rules set out various requirements. An operator should not be able to exercise control of commercial broadcasting licences whose total licence area population exceeds 75% of the population of Australia; nor control more than one television broadcasting licence in the same licence area. </p>
<p>There are also rules which aim to retain a minimum number of media voices, not less than five in major cities and four in regional areas (the 4/5 rule). Transactions that lead to control of a commercial television broadcasting licence, a radio broadcasting licence and a newspaper in the same area are also prohibited.</p>
<p>The ACMA rules tend to be rather more mechanical than the competition laws, which are likely to present some real challenges for this proposed transaction.</p>
<p>The media sector has experienced significant disruption in recent years. In broadcasting Pay TV has become entrenched while various online offerings now compete with free to air. The pressure is clearly being felt in the sector and in particular the difficulties faced by Ten have been well documented.</p>
<p>Inevitably the sector will respond to these pressures in various ways. This has included lobbying the Minister for Communications to reduce licence fees. A <a href="http://www.buseco.monash.edu.au/assets/documents/reforming-freetoair-broadcasting.pdf">recent paper from the Monash Business Policy Forum</a> on the reform of spectrum licencing provides some suggestions for a way forward in that area, including eliminating the commercial broadcasters’ public service obligations and transferring them to public broadcasters.</p>
<p>The pressure for structural change within the sector is high. However this is likely to continue to rub up against the competition laws for some time. As competition from new areas grows the question might be asked why the ACCC should have concerns. </p>
<h2>Sport is the crunch point</h2>
<p>The ACCC’s request for submissions to interested parties gives some insights around its potential concerns. These centre on the question of whether Foxtel will be able to control or influence Ten and how this might affect competition for content, particularly sporting content. The ACCC has a long list of questions but these are likely to be the core issues.</p>
<p>The concern seems to be that as a result of the transaction Foxtel and Ten might be more likely to partner with each other in bidding for premium sporting content, essentially AFL and NRL, and this might make it difficult for other free to air operators to compete. The result may be a lessening of competition for the acquisition of these rights. </p>
<p>The ACCC’s 2012 <a href="https://www.accc.gov.au/media-release/accc-to-oppose-seven-group-holding%E2%80%99s-proposed-acquisition-of-consolidated-media-holdings">decision to oppose</a> the then proposed acquisition by Seven Group Holdings of Consolidated Media Holdings’ shares in Foxtel makes interesting reading. While all mergers are different and circumstances may vary there does appear to be some common issues between that transaction and this one. </p>
<p>In this case the ACCC found:</p>
<blockquote>
<p>“Due to the benefits that premium sports rights can provide to free to air networks, the ACCC considered that the potential impact on the ability of Seven Network’s competitors to acquire sports rights jointly with FSA and FOXTEL as a result of the indirect ownership interests and board representation which would be acquired by Seven…would have a significant effect on their ability to compete effectively in the free to air television market.” </p>
</blockquote>
<p>The questions asked by the ACCC to interested parties do not single out premium sporting content, but nevertheless the submissions from the AFL and NRL are likely to be read with particular interest.</p><img src="https://counter.theconversation.com/content/45238/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Joe Dimasi is a former Commissioner and Senior Executive of the ACCC and was a member of the ACCC's Mergers Committee.</span></em></p>Fear of a Foxtel-Ten partnership to acquire sporting rights is likely to worry the ACCC.Joe Dimasi, Professorial Fellow, Department of Economics, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/397832015-04-08T20:07:21Z2015-04-08T20:07:21ZIs Foxtel most at risk in the new Game of Screens?<p>If the experience in other major television markets like the United States and Canada is anything to go by, the omens are mixed for Foxtel. </p>
<p>In the US, the phenomenon of “cord-cutting”, or “churn” – when a consumer cancels their subscription to a cable or satellite pay television service, often in order to take up cheaper “over the top” services delivered online, such as Netflix, Amazon Prime and Apple TV – has attracted increasing attention in recent years. </p>
<p>The US launch today of the stand-alone service HBO Now (initially available exclusively via Apple TV boxes) has increased the frenzy of reports on cord-cutting, and proliferated guides to <a href="http://time.com/money/3767927/cable-tv-without-paying-bill/">“ditching cable”</a>.</p>
<p>And yet while pay television subscriptions are falling in both the US and Canada, they are falling very slowly. One research firm has reported that the 13 largest US pay-television providers that collectively represent about 95% of the market, <a href="http://www.leichtmanresearch.com/press/030315release.html">lost a total of 125,000 subscribers</a> – or 0.1% of the total – in 2014. </p>
<p>In Canada, the drop in 2013 was even smaller, from 11.514 million to 11.507 million subscribers (or less than 0.1%). Meanwhile, revenues, profit, and employment in the sector all <a href="http://news.gc.ca/web/article-en.do?nid=848179">increased</a>. </p>
<h2>The Netflix wildcard</h2>
<p>In Australia, <a href="http://www.theaustralian.com.au/business/foxtels-price-cut-pays-off-with-boost-in-subscribers/story-e6frg8zx-1227217809689">Foxtel reported</a> in its half-year results ending December 31, 2014 that its subscribers rose by 118,000 to 2.6 million. This rise, while probably due to substantial discounting by Foxtel in the lead-up to the Australian launch of Netflix, more than offset a very high churn rate of just below 11.5%. </p>
<p>Despite Foxtel’s rise in subscriptions, its revenue growth was a weak 1.2% for the half-year, and less than 30% of Australian households currently subscribe to a pay television service. This proportion has risen very slowly over the last decade. In the USA, the equivalent figure is more like 80%.</p>
<p>The “glass half full” take on this, represented by Telstra CEO David Thodey, (Telstra is a part-owner of Foxtel) is that the Australian subscription television/SVOD base is set to rise to approximately 70% in future. Thodey did not predict what <a href="http://www.smh.com.au/business/telstra-hopeful-paytv-market-will-hit-70-per-cent-20150215-13d6h5.html">proportion Foxtel would command</a>. </p>
<p>At the end of 2014, <a href="http://www.nielsen.com/us/en/insights/reports/2015/the-total-audience-report-q4-2014.html">approximately 40% of American households subscribed to an SVOD service</a>, with Netflix by far the most popular.</p>
<p>In Australia, it has been reported that around 200,000 Australians have previously subscribed to the American Netflix service. Around ten times that number have <a href="http://www.theaustralian.com.au/business/media/netflix-takes-lead-in-race-for-subscriptions/story-e6frg996-1227292402172">reportedly</a> indicated that they either already subscribe, or intend to subscribe to the Australian Netflix service.
If this latter figure is correct, it is not far off Foxtel’s current subscriber base. </p>
<p>It is of course highly likely that many Foxtel subscribers are also subscribing to Netflix – at least during the latter’s initial first month free promotion. It will be fascinating to see whether Netflix’s numbers fall when this promotion ends.</p>
<h2>Substantial price discounting</h2>
<p>In November, Foxtel drastically reduced its prices for new subscribers, <a href="http://mumbrella.com.au/foxtel-boss-flags-major-changes-tackle-threat-streaming-rivals-249430">offering</a> a range of new channel bouquets. In February, through its part-owner Telstra, Foxtel <a href="http://mumbrella.com.au/foxtel-unveils-triple-play-bundle-streaming-competition-heats-273580">launched</a> a “triple-play” bundle combining subscription television, broadband, and home phone. </p>
<p>And late last month, just as Netflix opened for business in Australia, Foxtel launched its new iQ3 set top box. Unfortunately for Foxtel, the box has been plagued with problems, much to <a href="http://www.smh.com.au/business/media-and-marketing/foxtel-bats-away-suggestions-iq3-glitches-were-consequence-of-rush-to-beat-netflix-20150406-1mdn78.html">subscribers’ annoyance</a>. </p>
<p>All of these moves reflect the fact that Foxtel is not able to compete with Netflix on price alone. The new SVOD service’s basic offering costs A$8.99 per month, while Foxtel’s cheapest package is A$25 per month, which doesn’t include the new set top box. </p>
<p>Foxtel considers itself much more competitive in terms of content offered. Netflix’s Australian catalogue currently boasts about 1000 films and programs. This is substantially smaller than its offerings in the USA and Canada, leading the chief executive of News Corp (half-owner of Foxtel) to describe the Australian service as <a href="http://www.smh.com.au/business/media-and-marketing/arrival-of-netflix-and-svod-set-to-change-australian-tv-20150327-1m8zlo.html">“slightly warmed-up leftovers”</a>. This is both disingenuous, given Netflix’s investments in original content, and hypocritical, given some of the programs that fill Foxtel channels’ schedules. And further, takeup of Netflix to date suggests consumers are unconcerned.</p>
<h2>Content will be king</h2>
<p>Exclusive content is the main battleground, and Game of Thrones is Foxtel’s champion – <a href="http://www.news.com.au/technology/online/entire-fifth-season-of-game-of-thrones-to-be-timed-with-us-release/story-fnjwneld-1227258050042">for the next ten weeks, at least</a>. Two years ago, Foxtel signed a deal with GoT’s producer HBO. This was soon followed by a <a href="https://theconversation.com/the-foxtel-bbc-deal-implications-for-australian-television-and-content-13654">landmark deal</a> for first-release content with the BBC. And of course Foxtel also has a slew of sports content that Netflix cannot match, for the moment at least.</p>
<p>Neither should it be forgotten that Foxtel has its own VOD service – Foxtel Play – as well as Presto, a joint partnership with the Seven Network. In theory, Foxtel Play should be Foxtel’s trump card. Along with access to a huge back catalogue, the service also allows subscribers to watch live television online. * </p>
<p>But the app that allows access to Foxtel Play on mobile devices – somewhat confusingly called Foxtel Go – is as buggy and unpopular with subscribers as the new iQ3 set top box. And judging by comments on the app’s page in the Appstore, and on <a href="http://community.foxtel.com.au/t5/Foxtel-Go/bd-p/Foxtel-Go">Foxtel’s own Foxtel Go Community page</a>, these problems are not new, and Foxtel seems unwilling or unable to do anything about them. </p>
<p>Foxtel has a number of advantages that should help it maintain its business for the time being. First, it has a large and still growing (albeit very slowly) subscriber base, which <a href="http://www.smh.com.au/business/spending-on-digital-entertainment-tipped-to-hit-40b-by-2018-20140706-3bgit.html">delivers a very healthy average revenue per user of around $100</a>. However, high churn rates and the issues with some of its services and technologies suggest that subscribers are not all rusted on.</p>
<p>Second, it has an extensive catalogue of exclusive content, including an unmatched offering of sports programming.</p>
<h2>Powerful backers</h2>
<p>Third, it is an innovator, brokering deals to offer its services through devices such as Microsoft’s XBox and Sony’s Playstation, as well as online. Its set top box technology, in theory, is top of the range, although teething problems have taken a bite out of the iQ3. It offered catch-up services online in advance of most of its competitors, but technological problems persist.</p>
<p>Fourth, it has the backing of two major players in the form of joint owners Telstra and News Corp. Neither of these behemoths are likely to see their offspring go down without a fight, and there are clear indications that they will do all they can to prop it up. </p>
<p>The “triple play” deal leverages Telstra’s market power, with Foxtel also an integral part of Telstra’s T-Box service. And if Megan Brownlow, editor of PwC’s Australian Media and Entertainment Outlook, is correct in arguing that “<a href="http://mumbrella.com.au/foxtel-unveils-triple-play-bundle-streaming-competition-heats-273580">This will be a marketing war not just a content war</a>”, then News Corp will be an invaluable ally.</p>
<h2>Watch this space</h2>
<p>There are also several factors that play against Foxtel. First, its overheads are considerably higher than Netflix’s, given the technological infrastructure and support services that Foxtel must maintain. </p>
<p>Second, <a href="http://screenaustralia.gov.au/news_and_events/bulletins/didyouknow/2015/10Mar2015.aspx">Australians are increasingly comfortable with VOD services</a>. In research conducted prior to the launch of Netflix, over 50% of Australians surveyed reported regularly watching video online. 50% of those surveyed said that they would watch more content online if they had a faster Internet connection. </p>
<p>It will only be a matter of time before this changes. In its latest <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/8153.0/">Internet Activity survey</a>, the Australian Bureau of Statistics found that at the end of 2014, almost 99% of all Internet connections were broadband. Over 70% of broadband subscribers have a service with an advertised download speed above 8Mbps. While many still experience lower speeds, this is still more than sufficient to receive VOD services in Standard Definition. </p>
<p>There may be no ultimate victor in the new Game of Screens. But judging by the contestants’ moves, and by the audiences they are attracting, it will be compulsive viewing for some time to come.</p>
<hr>
<p>* <i>Since publication this piece has been amended. The original piece incorrectly identified Presto as a joint venture between Foxtel and Fairfax Media. Presto is jointly owned by Foxtel and the Seven Network. Stan is the joint venture between Fairfax Media and the Nine Network.</i></p><img src="https://counter.theconversation.com/content/39783/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ben Goldsmith does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Australians have enthusiastically embraced new streaming service Netflix. But with its subscription business model under threat, Foxtel is coming out fighting.Ben Goldsmith, Senior Research Fellow , Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/389792015-03-24T19:15:18Z2015-03-24T19:15:18ZHeed Fraser’s warning on Australian media concentration – it’s getting worse<p>The passing of former Prime Minister Malcolm Fraser last Friday prompted me to recall his warning about the state of Australian media ownership <a href="http://electionwatch.edu.au/australia-2013/election-rewind/malcolm-fraser-contemporary-media-and-politics">in an interview</a> I did with him during the last federal election.</p>
<p>He said: “In my term, there were seven print proprietors. Now there is one and a bit. We have the most concentrated media in any democratic country, anywhere in the entire damn world. That is dangerous.”</p>
<hr>
<p>Malcolm Fraser for The Conversation: <a href="https://theconversation.com/malcolm-fraser-does-it-matter-who-owns-our-papers-yes-it-does-7738">Does it matter who owns our papers? Yes it does</a></p>
<hr>
<p>Malcolm Fraser’s warning is one we should take seriously. As Fairfax Media finalises union talks this week to cut 80 local jobs across its regional newspapers, and federal communications minister Malcolm Turnbull is again flagging relaxing media ownership laws, local news is particularly under threat in the global media environment where large audience reach matters.</p>
<h2>More regional cuts</h2>
<p>In Victoria, to remain competitive in this environment, Fairfax has proposed cutting 62 editorial jobs among the 80 full-time positions earmarked for redundancy across 13 regional mastheads including Albury Wondonga’s Border Mail, The Ballarat Courier, Bendigo Advertiser and The Warrnambool Standard. </p>
<p>Local MPs and city councillors in these regions have spoken out against the cuts with independent MP Cathy McGowan telling the <a href="http://www.bordermail.com.au/story/2955199/cathy-mcgowan-stands-up-for-the-border-mail/">Federal Parliament last week</a> that regional newspapers such as the Border Mail play an important role providing local news and any job cuts could impact on this service.</p>
<p>The union representing local reporters, the Media Entertainment and Arts Alliance, will meet Fairfax in Sydney today to discuss the cuts. It is understood that the Border Mail will lose up to 23 staff, the Wimmera Mail will lose 40% of its workforce, the Ballarat Courier will lose some reporting staff and its news director, and most of the newspapers will lose some photographers and sub-editors.</p>
<h2>Diversity being squeezed</h2>
<p>Fairfax’s regional publishing business Australian Community Media (ACM) is also proposing a common newspaper template with opportunities for content sharing. Journalists spared from the sackings will be required to do more with less including taking photographs, sub-editing their stories and uploading them online. </p>
<p>The implications of these changes are concerning for the diversity of local reporting, its accuracy and future print circulation figures, which until now have remained buoyant compared to their city cousins. A well-functioning democracy requires an informed citizenry and, to do this, journalists find and verify information in the public interest, rather than just selecting information from press releases. Citizen journalists can fulfil some of this local news gathering role, but subject coverage can be patchy and lacking editorial authority.</p>
<p>The all-too-soon forgotten <a href="http://www.abc.net.au/mediawatch/transcripts/1205_finkelstein.pdf">Finkelstein media inquiry in 2012</a> reminds us that some local communities are already the poorer for losing local news outlets. </p>
<blockquote>
<p>There is some evidence that both regional radio and television stations and newspapers have cut back substantially on their news gathering, leaving some communities poorly served for local news. This may require particular support in the immediate future, and I recommend that this issue be investigated by the government as a matter of some urgency.</p>
</blockquote>
<h2>Changes mooted for media laws</h2>
<p>Yet, Malcolm Turnbull, photographed last year standing shoulder-to-shoulder with the nation’s media executives and flagging changes to media laws, has this month again raised the prospect of such reforms in a submission to the Prime Minister Tony Abbott. Turnbull’s argument essentially is that the internet has lowered the barriers to entry and enabled greater competition and more media diversity. At face value this sounds promising. Yet, such changes would make possible further media mergers and acquisitions and what such reforms would mean for local news reporting requires careful consideration.</p>
<p>Veteran journalists can readily recall the days when Canadian Conrad Black divested his stake in Fairfax because foreign ownership laws in 1996 prevented his company owning more than a 25% share of an Australian media outlet. </p>
<p>Today, among Australia’s top 10 news websites, all are digital iterations of traditional media outlets. The only new entrants to this list are not new Australian start-ups but large, foreign-owned companies such as Britain’s Daily Mail (fourth) and the Australian version of the British-owned Guardian (sixth).</p>
<h2>Foreign arrivals</h2>
<p>Foreign-owned media companies are reaching out to Australian shores as never before — not only do we have Australian versions of the Guardian and Daily Mail, but BuzzFeed, and very soon the Huffington Post (in a 51-49 partnership with Fairfax). In the broadcast media sphere US-owned Netflix announced it will undercut local competitors — Presto, jointly owned by Foxtel and Seven West Media; and Stan, a Fairfax and Nice Entertainment Co. partnership — to stream video content to Australian subscribers for $8.99 a month.</p>
<p>The arrival of foreign-owned media is interesting in the context that we once had specific laws to guard against it in the name of protecting Australian news content and its democratic function. Oddly, in 2015 when local newspapers are experiencing financial duress, there is little examination about what these offshore arrivals mean for Australian audiences and Australian news content, particularly in terms of local news. </p>
<h2>Start-ups struggling to survive</h2>
<p>Perhaps, the important question arising out of this global media environment is not how to limit competition and potential sources of news diversity; but rather, what can be done to encourage growth in Australian news media start-ups? The current environment makes it very difficult for them to succeed long-term, as Wendy Harmer identified yesterday when announcing her online outlet <a href="http://thehoopla.com.au/">The Hoopla</a> will close. In the US, start-up news reporting entities are tax-exempt non-profits recognised by the IRS under section 501(c)(3) of the tax code.</p>
<p>Australia’s Finkelstein media review also included suggestions for tax breaks for non-profit news outlets. Another idea was to allocate a proportion of Australia’s multi-million dollar government advertising and public notices expenditure for new news ventures.</p>
<p>Of course, the ABC plays a unique role delivering local Australian news across the nation’s states, but it too has suffered recent substantial funding cuts and journalism job losses.</p>
<p>The right formula to preserve the diversity of Australian local reporting might lie elsewhere, but shouldn’t we at least engage in the conversation?</p><img src="https://counter.theconversation.com/content/38979/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrea Carson is part of a research team based at the University of Melbourne's Centre for Advancing Journalism that is investigating the civic impact of journalism and local news reporting.</span></em></p>if anything, media concentration is worsening and diversity won’t be improved by changing Australia’s media ownership laws.Andrea Carson, Lecturer, Media and Politics; Honorary Research Fellow, Centre for Advancing Journalism , The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/340012014-11-20T19:26:57Z2014-11-20T19:26:57ZTelevision is not dead, it’s just changing channels<figure><img src="https://images.theconversation.com/files/65040/original/image-20141119-31612-1dyoagh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Australians are increasingly tuning in to traditional broadcast television stations</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>Netflix will <a href="http://www.abc.net.au/news/2014-11-19/netflix-to-expand-into-australia-new-zealand/5902396">launch in Australia</a> and New Zealand in March next year. Expectations are this is <a href="http://www.afr.com/p/technology/netflix_launches_in_australia_nz_nK4DEfnuWyWw9870XVOkCP">just the start</a> of an influx of new streaming options in Australia.</p>
<p>The internet and television are increasingly intertwined. It is expected that <a href="http://www.digitaltvresearch.com/ugc/press/69.pdf">30% of televisions globally</a> will be connected to the internet by 2018. In Australia, this figure was surpassed last year with <a href="http://www.pcworld.idg.com.au/article/455952/more_aussies_internet-ready_tvs_than_tablets/">a third of Australians</a> already using a television with internet capability.</p>
<p>However, people are also increasingly tuning in to traditional broadcast television stations. According to research, Australians watch television <a href="http://www.oztam.com.au/documents/Other/Australian%20Multi-Screen%20Report%20Q1%202014_FINAL_2.pdf">eight times more</a> than video content on other devices. </p>
<p>Australians are watching on average just over three hours of TV per day on in-home TV sets. For the first quarter of this year, Australians watched 37 minutes more television than they did a year ago. This figure is not decreasing even as options for accessing TV and other video content expand dramatically. </p>
<h2>Channel Ten interest</h2>
<p>These statistics underlie why companies are clearly still willing to invest in free-to-air television. News Corp is just one. Chairman Rupert Murdoch says <a href="http://www.afr.com/p/business/marketing_media/rupert_murdoch_confirms_foxtel_considering_rwlbajtA7UNCaNhEu7gfNI">Foxtel</a> and United States group Discovery Communications are among the bidders looking to buy a 14.9% stake in the Ten Network. </p>
<p>Other companies tipped to have <a href="http://www.businessspectator.com.au/news/2014/11/7/dataroom/ten-shares-surge-heavy-trade">placed offers</a> include <a href="http://www.timewarner.com">Time Warner</a>, <a href="http://www.fairfaxmedia.com.au/">Fairfax</a> and US private equity firm <a href="http://www.provequity.com">Providence</a>.</p>
<p>Whether a bid is successful rests on approval from the <a href="http://www.businessspectator.com.au/news/2014/11/10/dataroom/top-ten-shareholder-gordon-wont-sell-report">larger stakeholders</a> in the company. These include regional television giant Bruce Gordon, Gina Rinehart, James Packer and Lachlan Murdoch. </p>
<p>Gordon is the largest shareholder in Ten with a 14.9% share of the company. He is also the owner of WIN Corporation. <a href="http://www.businessspectator.com.au/news/2014/11/10/dataroom/top-ten-shareholder-gordon-wont-sell-report">Gordon has recently said</a>:</p>
<blockquote>
<p>“Ten should still stay as an Australian-owned operation and it should not be sold to any of these giant US pay-TV set-ups.”</p>
</blockquote>
<p>This may make it difficult to strike a deal with an international company.</p>
<p>While it is still unclear whether a deal will eventuate, reports place the Foxtel and Discovery Communications joint proposal as the best prospect. This may be due to Ten’s recent announcement of a <a href="http://images.tenplay.com.au/%7E/media/Corporate%20Site%20Media/Files/Press%20Releases/2014/Turn%20On%20TEN%20In%202015.pdf">joint project</a> with Foxtel to create an Australia version of the United Kingdom program <a href="http://www.channel4.com/programmes/gogglebox">GoggleBox</a>. The program captures people’s reactions as they watch television in their homes. </p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/lxkIoCATjAA?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Nigella Lawson on the UK version of Gogglebox.</span></figcaption>
</figure>
<p>The project is interesting as it may indicate a future broadcasting model. GoggleBox will premiere on Foxtel and screen on Ten the following night. Currently, many high-rating programs from the United States or United Kingdom are delayed. This is a cause of <a href="http://www.afr.com/p/technology/aussies_say_they_get_stop_pirating_oqwQtzQGz3is92ITkKZCMP">frustration for Australians</a> and is considered one of the reasons for our high levels of television piracy. </p>
<p>Australian broadcasters have recently attempted to fast-track programs. However, according to Seven Chief Executive Tim Worner, this <a href="http://www.smh.com.au/business/media-and-marketing/fasttracked-shows-dont-work-says-seven-20141102-11f3jl.html">approach still doesn’t work</a>.</p>
<h2>Digital developments</h2>
<p>Australian television broadcasters are not only competing with each other, but also with <a href="https://theconversation.com/youtube-games-star-pewdiepie-is-playing-for-global-dominance-32681">new digital players</a>. </p>
<p>Fairfax Digital offers a television service through its SMH TV and Age TV offering. In the United States, multichannel network <a href="http://www.makerstudios.com/">Maker Studios</a> launched its <a href="http://Maker.tv/">Maker.tv</a> service, which Disney purchased for US$950 million. </p>
<p>Seven and Nine have already moved towards establishing streaming services in addition to their catch-up television offering. <a href="http://Stan.com.au">Stan.com.au</a> is a joint venture between Nine and Fairfax which streams online TV programs and movies. Seven is <a href="http://www.smh.com.au/business/media-and-marketing/seven-west-media-back-in-the-black-hints-at-video-deal-20140827-108vsn.html">rumoured</a> to be liaising also with Foxtel to launch its own video streaming service. </p>
<p>The direction that Ten may take in this area is unclear. Its previous joint venture with Village Roadshow, <a href="http://www.villageroadshow.com.au/upload/Document/SCAPE_Rel1.pdf">Village Ten Online</a>, went into receivership only months after its launch in 1999.</p>
<h2>The government response</h2>
<p>The Australian government is likely to support any move to online by Australian broadcasters. Communications Minister Malcolm Turnbull recently announced his plan to move <a href="http://www.malcolmturnbull.com.au/media/the-future-of-community-tv">community television online</a>, arguing this was the future of television. </p>
<p>A move to online television may also assist the government with the public’s perception of the <a href="http://www.nbnco.com.au/">NBN</a>. For a streaming service to be successful, the technology needs to be adequate. The NBN will allow greater data and therefore better online visuals.</p>
<p>However, the government may need to reconsider Australia’s broadcast laws and the way in which television broadcasters are defined. Whether new digital content is to be defined as <a href="https://theconversation.com/noisivision-radiospects-tellser-what-indeed-is-television-31741">television</a> is yet to be answered.</p>
<p>Online content does not presently have the same restrictions as traditional broadcast. This will allow room for niche programming and programs that break the traditional mould. It will also open greater opportunities for traditional broadcasters to experiment with new programs.</p>
<p>It clear that television is far from dead. There are more opportunities for traditional broadcasters to leverage their offering into the digital space. However, television needs to move quickly or be overtaken by new foreign streaming players.</p><img src="https://counter.theconversation.com/content/34001/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marc C-Scott does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Netflix will launch in Australia and New Zealand in March next year. Expectations are this is just the start of an influx of new streaming options in Australia. The internet and television are increasingly…Marc C-Scott, Lecturer in Digital Media, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/256082014-04-29T20:30:34Z2014-04-29T20:30:34ZDoes the ABC deliver Australians good bang for their buck?<figure><img src="https://images.theconversation.com/files/46722/original/4mv28959-1397880558.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">That the ABC is too big and too expensive for an affluent democracy such as Australia is nothing but a myth.</span> <span class="attribution"><span class="source">AAP/Tracey Nearmy</span></span></figcaption></figure><p><em>Due to Australia’s small population and high concentration of few media voices, public broadcasters play a pivotal role in shaping the media ecosystem and cultural landscape. With the ABC and SBS under scrutiny ahead of the budget, The Future of Public Broadcasting series looks at the role of these taxpayer-funded broadcasters, how they shape our media and whether they provide value for money.</em></p>
<hr>
<p>A tough federal budget round is looming and the ABC’s government funding is <a href="http://www.smh.com.au/federal-politics/political-news/abbott-to-break-abc-no-cuts-promise-20140412-zqty9.html">reportedly</a> set to be cut. Campaigning for a leaner ABC are <a href="http://www.theaustralian.com.au/media/broadcast/bloated-abc-ripe-for-cuts-but-not-in-regions/story-fna045gd-1226884302685">elements within the Liberal Party</a> and commercial media such as <a href="http://www.theaustralian.com.au/opinion/columnists/chasers-have-more-power-than-mark-scott/story-fnkqo7i5-1226889406030">The Australian</a>, which has previously <a href="http://www.theaustralian.com.au/media/on-air-and-off-the-abc-spares-no-expense-on-its-stars/story-e6frg996-1226763878649">drawn attention</a> to the high salaries paid to the ABC’s top presenters and managers.</p>
<p>But you don’t need to work for The Australian to question the apparent profligacy reflected in some of those salaries, or the need for the ABC to be involved in the provision of quite so many digital and online services. These could, some argue, be provided more efficiently by the private sector. </p>
<p>The media environment has changed fundamentally with digitalisation, and the cosy assumptions of the analog era about the untouchability of public service media are, in 2014, the legitimate subject of challenge and debate.</p>
<p>We recently <a href="https://theconversation.com/what-would-the-australian-media-look-like-without-the-abc-24033">speculated</a> what Australian television would look like if the ABC did not exist. But let’s now ask the approximately A$1 billion question – for that is the sum the Australian taxpayer <a href="http://www.budget.gov.au/2012-13/content/bp4/html/bp4_ar_04_dbcde.htm">shells out</a> to fund the ABC every year – is the service delivering value for money, or not? Does it represent a good return for the resources allocated to it?</p>
<p>One relatively objective way to look at answering these questions, which seems reasonable given the tone of the criticism that the ABC receives from some in the private sector, is to compare its costs against those of commercial rivals.</p>
<p>Pay TV service <a href="http://www.foxtel.com.au/default.htm">Foxtel</a> offers access to nearly 100 channels and a wide range of interactive services. The cost of a <a href="https://www.foxtel.com.au/shop/packages-and-deals/?execution=e3s1">Platinum package</a> – which includes access to 90 channels, on-demand movies, some channels in high definition, recording facilities and catch-up TV – is A$124 per month (plus installation and equipment fees), or nearly A$1500 per year, or just over A$4 a day.</p>
<p>Subscribers can watch up to 60 Foxtel channels on devices such as iPads and iPhones with the <a href="http://www.foxtel.com.au/discover/foxtelgo/default.htm">Foxtel Go</a> app, and set programs to record remotely from anywhere in the world. Some of Foxtel’s content is produced in Australia, though most is imported from overseas. Some is cheap as chips to supply, some very expensive. </p>
<p>Either way, millions of Australians are prepared to pay those few dollars a day for the package.</p>
<p>The ABC received A$1,030 million in the May 2012-13 federal budget, supplemented by an additional A$158.2 million from commercial and other income streams. </p>
<p>Per capita, this works out at the sum of 14 cents a day for every man, woman and child in the country. That is about 1/25th of the daily cost of the top-line Foxtel package. For that, the Australian media consumer gets four TV channels, national and local radio and online content.</p>
<p>It’s not straightforward, or even fair, to directly compare the ABC’s low-cost provision with the multichannel smorgasbord of Foxtel sport, movies, news, entertainment and the rest. But who can seriously maintain, given around <a href="http://www.tvtonight.com.au/2013/08/foxtel-subscribers-up.html">2.5 million Australians</a> pay nearly hundreds of dollars a year to Foxtel, that 14 cents a day for the ABC’s content is excessive?</p>
<p>Comparing the ABC with public broadcasters overseas reinforces this point. Charts 1 and 2 show the annual per capita cost of the ABC against its Canadian and UK equivalents. While the ABC costs almost <a href="http://www.cbc.radio-canada.ca/site/annual-reports/2011-2012/pdf/cbc-rc-annual-report-2011-2012.pdf">exactly the same</a> per head of population as the <a href="http://www.cbc.ca/">Canadian Broadcasting Corporation</a> (CBC), it is just over one-third the cost of the BBC, calculated on the same basis. </p>
<p>In 2012-13, the cost per capita per day of the <a href="http://www.bbc.co.uk/aboutthebbc/insidethebbc/whoweare/licencefee/">licence fee</a> in the UK (which funds the BBC’s operations) was 21 pence, or around 39 cents, as against the ABC’s and CBC’s 14 cents. However, unlike its British and Australian counterparts, the CBC uses commercial advertising on TV to supplement its government funding.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=406&fit=crop&dpr=1 600w, https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=406&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=406&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=510&fit=crop&dpr=1 754w, https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=510&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/46869/original/kjnwnkym-1398211670.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=510&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Government and commercial income of the ABC, BBC and CBC.</span>
<span class="attribution"><span class="source">Authors</span></span>
</figcaption>
</figure>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=410&fit=crop&dpr=1 600w, https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=410&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=410&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=515&fit=crop&dpr=1 754w, https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=515&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/46615/original/n7gmk5kj-1397707410.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=515&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Cost per capita per day of the ABC, BBC and CBC.</span>
<span class="attribution"><span class="source">Authors</span></span>
</figcaption>
</figure>
<p>In short, even by the standards of public service media, the ABC is quite a lean machine. </p>
<p>One example shows how: in the UK, when invited on to a BBC radio or TV show to comment on a topical issue, as we academics are from time to time, guests receive automatically an appearance fee (around £30-100 for a few minutes, depending on the size of the audience for the program) and a complimentary taxi to and from the studio (perhaps another £50 in total).</p>
<p>In Australia, academics are expected to do this commentary work for free, as part of our professional role. The ABC thereby saves millions of dollars per year in contributor costs. Across the board, the BBC is a much more luxuriously funded organisation.</p>
<p>None of this would matter very much if the quality of ABC content and services did not satisfy the audience. But there is <a href="http://about.abc.net.au/wp-content/uploads/2013/10/ABC-Annual-Report-2013-Part-5.pdf">clear evidence</a> that the output produced for those 14 cents per day is valued. </p>
<p>Not only does ABC content reach broad swathes of the Australian public – ABC online reaches 22% of the market; city metro radio reaches 24.4%; ABC TV has around 20% in both metro and regional markets – but a 2013 Newspoll survey found that 78% thought ABC TV content was “good”. In the same poll, 86% regarded ABC online content as “good”.</p>
<p>None of this should serve as an argument for leaving the ABC to its own devices. Its costs, and the range of activities it engages in, must be justified in terms of its public service remit. But let’s once and for all scotch the myth that the ABC is too big and too expensive for an affluent democracy such as Australia.</p>
<hr>
<p><em>Read more articles in <a href="https://theconversation.com/topics/the-future-of-public-broadcasting">The Future of Public Broadcasting</a>.</em></p><img src="https://counter.theconversation.com/content/25608/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brian McNair receives funding from the Australian Research Council.</span></em></p><p class="fine-print"><em><span>Adam Swift does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Due to Australia’s small population and high concentration of few media voices, public broadcasters play a pivotal role in shaping the media ecosystem and cultural landscape. With the ABC and SBS under…Brian McNair, Professor of Journalism, Media and Communication, Queensland University of TechnologyAdam Swift, Senior Research Associate, ARC Centre of Excellence for Creative Industries and Innovation, Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/210312013-12-04T03:43:22Z2013-12-04T03:43:22ZPay TV triple play pits Foxtel in three-legged race with Telstra<figure><img src="https://images.theconversation.com/files/36872/original/fhj9b3fm-1386122737.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Foxtel will compete directly with half owner Telstra when it begins offering telephone and broadband internet services in the next twelve months.</span> <span class="attribution"><span class="source">Flickr/Bell</span></span></figcaption></figure><p>Monday’s <a href="http://www.foxtel.com.au/about-foxtel/communications/foxtel-to-launch-triple-play-of-television-broadband-and-fix-223504.htm">announcement</a> by Foxtel that it will launch broadband internet and fixed line telephony services bundled with its pay tv services comes as <a href="http://www.theaustralian.com.au/media/news-eyes-expansion-as-profits-rebound/story-e6frg996-1226758545445">no surprise</a>. </p>
<p>The deal, known as a Triple Play, will see Foxtel selling fixed line broadband and telephony services in competition with its 50% owner Telstra.</p>
<p>But while telephone services have been under discussion for more than a year now, the new offering will not see the light of day for another 12 months and the all important prices and conditions have not yet been announced.</p>
<p>The deal brings Foxtel into line with Optus and the iiNet offering called Fetch which have been offering all of the elements of the triple play plus mobile telephony services.</p>
<p>In announcing the new service, Richard Freudenstein, Foxtel CEO noted that an important motivation was to reduce the currently high rate of subscribers to drop out of the service.</p>
<p>For years, Foxtel has been pushing to break through the barrier of 30% penetration in Australian households. While the number of subscribers was up by 100,000 over the last year, customer churn numbers remains high. One industry source noted Foxtel lost 380,000 customers in the year from its total 2.5 million subscribers. </p>
<p>Bundling broadband and fixed line services to the subscription is intended to lock customers in and reduce the growing number of Australians who are signing up with the US subscription video on demand service Netflix.</p>
<p>Although not officially operating in Australia, Netflix has a rapidly growing local viewer list attracting <a href="http://if.com.au/2013/10/31/article/Netflix-causes-angst-in-Oz/UFCURZLHDF.html">up to 150,000 subscribers</a> paying less than one third of Foxtel’s monthly charges for its subscription video on demand service called <a href="http://www.presto.com.au/">Presto</a>.</p>
<p>The outstanding question posed by the triple play concept is the potential impact on competition within the merging broadband and entertainment markets and uncertainties caused by the new government’s redefinition of the National Broadband Network.</p>
<h2>An owner and a rival</h2>
<p>Foxtel is jointly owned by News Ltd and Telstra and according to the management agreement, Foxtel is required to obtain all of its internet services from Telstra. In a curious commercial arrangement, Telstra is currently an active marketer of Foxtel as well as being a retail competitor.</p>
<p>To date it has been in Telstra’s commercial interest to ensure Foxtel was not in a position to draw away Telstra’s own broadband and telephony customers. Industry consensus is the long delay in implementation of the triple play has been a sign of Telstra’s reluctance to support more direct competition.</p>
<p>The prospect of a more open-access NBN in which Foxtel or other new broadband and telephony providers can bring services to market has been a threat hanging over the heads of all current operators. </p>
<p>In the stand-alone broadband and telephony service markets, like with energy suppliers, the absence of long-term contracts and complex bundled arrangements have led to very high rates of consumer churn which savages the bottom lines of operators. </p>
<p>Typically new customer acquisition costs all but wipe out the very extensive investment in advertising and customer acquisition. Even a small increase in retention rates can quickly inflate the profit performance.</p>
<p>Overall impacts on competition are difficult to project in the absence of any indication of pricing strategies and details of the likely product bundles offered. However, with the near stranglehold on content, Foxtel and Sky Sports are likely to retain the ability to charge premium prices for customers and to improve retention rates as well.</p>
<h2>Foxtel in the time of Netflix</h2>
<p>Perhaps the greatest threat to Foxtel and a significant driver in its new triple play bundling strategy is the continued roll-out of high-speed broadband throughout Australia. </p>
<p>The threat comes in the form of streaming content providers such as the US giant Netflix which has come to rival the power of the US pay TV operators and even the Hollywood studios through aggressive marketing of almost unlimited content at rock bottom monthly subscription prices. </p>
<p>While <a href="https://theconversation.com/netflix-australia-launch-could-be-imminent-19553">there has been talk</a>, there is no confirmation that Netflix will come to Australia. However it is clear from the company’s most recent annual report that international expansion is very much on the agenda.</p>
<p>In a <a href="http://www.sec.gov/Archives/edgar/data/1065280/000106528013000008/nflx1231201210kdoc.htm">recent US regulatory statement</a>, Netflix noted that “domestically, cable and satellite pay TV subscribers numbers have stagnated, while DVR penetration has continued to climb”. Rapid growth in mobile platforms and heavy investment in technology has given Netflix a clear competitive head start.</p>
<p>As with the rationalisation of pay TV operators in Australia during the 1990s, the ability of governments to preserve vigorous market competition is severely limited. There are currently two decisions within the remit of governments which will influence the pay TV landscape.</p>
<p>The first is the relaxation of the anti-siphoning rules which prevent free-to-air programs transferring to pay only channels. Already the <a href="https://theconversation.com/political-favours-and-the-rights-of-tv-sport-audiences-20701">pressure is on the government to relax these rules</a>.</p>
<p>The second government-related decision is the access price determined by the ACCC for the wholesale supply of NBN carriage services. If the access pricing is reduced from current Telstra wholesale levels, there is the real prospect of a short-term price war among content providers.</p><img src="https://counter.theconversation.com/content/21031/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Allan Asher does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Monday’s announcement by Foxtel that it will launch broadband internet and fixed line telephony services bundled with its pay tv services comes as no surprise. The deal, known as a Triple Play, will see…Allan Asher, Visitor, Regulatory Institutions Network (RegNet), Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/140412013-05-09T01:19:11Z2013-05-09T01:19:11ZThe News Limited paywall dilemma: how to avoid competing against yourself<figure><img src="https://images.theconversation.com/files/23375/original/svp44hrq-1368019654.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">News Limited CEO Kim Williams has been forced to change tack on the online newspaper paywall model for the company's metro mastheads.</span> <span class="attribution"><span class="source">AAP/Joe Castro</span></span></figcaption></figure><p>You could almost feel sorry for newspaper owners. The internet is smashing their hard copy advertising revenue and they have yet to work out how to make money out of their online editions.</p>
<p>It is just over a year since News Limited <a href="http://www.smh.com.au/business/media-and-marketing/herald-sun-to-hoist-online-paywall-in-march-20120223-1tpe3.html">moved its Melbourne Herald Sun tabloid</a> to a “metered” online paywall model. Now News Limited <a href="http://mumbrella.com.au/news-limited-confirms-move-to-metered-paywall-154393">has announced</a> that the Herald Sun, together with Sydney’s Daily Telegraph, will be moving to a different pricing model later this month.</p>
<h2>Interpreting the move</h2>
<p>At first glance, it looks like the “freemium” model - where some articles are free to all readers and other articles are locked and available to subscribers only - has failed. Indeed, as more newspapers around the world <a href="http://www.businessspectator.com.au/article/2013/5/8/media-and-digital/news-and-fairfax-aim-meter-perfect-dive">move to a metered model</a>, it could be argued that the industry is converging on a “winning” pricing strategy for the internet.</p>
<p>Such a conclusion is at best premature and at worst wrong. News Limited is not going to adopt a pure metered model. Instead, it will have a “hybrid” model. As <a href="http://www.theaustralian.com.au/media/news-unveils-metered-paywall-plan-for-daily-telegraph-and-herald-sun/story-e6frg996-1226637384084">noted</a> in The Australian, “some premium sports content will only be available to subscribers”, so there will be a hard paywall for some content and a “try-before-you-buy” model for other content.</p>
<p>News Limited is also allowing itself plenty of wiggle room. It is rolling out the model to the Adelaide Advertiser and Brisbane’s Courier Mail in June. But, News Limited claims “the models will vary across Australia depending on the local market”.</p>
<p>An alternative conclusion is that online newspapers have no idea what to do and are grasping at straws. I think that such a conclusion is reasonable for some publications (and I suspect Fairfax fits into this category). </p>
<p>However - in my opinion - News Limited CEO Kim Williams knows exactly what he is doing. Williams is establishing an internet sports “channel” based on Foxtel’s suite of Fox Sports channels: and he is pretending that it is an online newspaper.</p>
<h2>Evidence</h2>
<p>The announcement is merely the latest step in a strategy News Limited has been following for the past year. This strategy included <a href="http://www.news.com.au/breaking-news/news-limited-cleared-for-194bn-consmedia-takeover/story-e6frfkp9-1226509292987">gaining</a> 50% of Foxtel and 100% of Fox Sports. <a href="https://theconversation.com/news-limited-reveals-its-convergent-future-but-will-its-pay-walls-pay-off-7818">As I noted</a> when the acquisition was announced: </p>
<blockquote>
<p>News Limited is expanding. It is grasping new technology with both hands and bonding traditional and alternative news outlets together.</p>
</blockquote>
<p>The other key element in News Limited’s paywall announcement was not the pricing model but rather the change of focus. The online publications will be under a separate “news +” brand. As Kim Williams stated: </p>
<blockquote>
<p>…subscribers will have access to their local masthead with enhanced local content as well as to our entire national news, lifestyle, business and sport network, delivered across all the devices they love.</p>
</blockquote>
<p>The “local masthead” will simply be a local brand name used to sell a national product. And that new product is likely to have lots of video, sourced predominantly from Fox Sports.</p>
<p>So my conclusion from the paywall shift announcement is simple. News Limited is just continuing on the path it set itself on at least a year ago. That path will replace online editions of its newspapers with on-demand video based around sports content. It will have some video news, some “text articles” and some local content. But it will be a subscriber-based, online video channel.</p>
<p>Will this business model work? Only time will tell. There is a lot of free sports content available on the internet already, and News Limited is going to have to fight against other owners and providers of video sports content such as Telstra. To work, the model will need to have enough unique content to encourage online viewers to pay the $4 per week full digital subscription.</p>
<p>The model has risks for News Limited. To the degree online subscribers can access Fox Sports content through their “newspaper” subscription, they will not need to access it through Foxtel. However, News Limited own 50% of Foxtel, so if its online model works then it will undermine the profitability of its pay TV business.</p>
<p>In this sense, News Limited faces a problem of effectively competing against itself. If news+ is a great alternative to pay TV, News Limited wins through news+ but may lose money overall. So News Limited wants news+ to succeed – but not too well. </p>
<p>Therefore, instead of making news+ a high quality online service, News Limited will be tempted to limit the content on news+ to avoid undermining Foxtel. Of course, if it does this then news+ is less likely to be successful.</p>
<p>So while news+ is a bold move, News Limited is faced by a conflict that may kill it. How does it make a successful new media company that does not compete too hard with its old media?</p>
<p>Finally, what does all this mean for the print newspapers? </p>
<p>This announcement is their epitaph. It suggests that News Limited really sees little future in hard copy newspapers. They will continue until their revenue falls to a point where they are unprofitable. Then they will die. But don’t worry: you can always switch to news+.</p><img src="https://counter.theconversation.com/content/14041/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stephen King does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>You could almost feel sorry for newspaper owners. The internet is smashing their hard copy advertising revenue and they have yet to work out how to make money out of their online editions. It is just over…Stephen King, Professor, Department of Economics, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.