Bills Digest no. 35 2008–09
Broadcasting Legislation Amendment (Digital Television Switch-over)
Bill 2008
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Contact officer & copyright details
Passage history
Date introduced:
24 September 2008
House:
Senate
Portfolio:
Broadband, Communications and the Digital Economy
Commencement:
Sections 1–3, on the day of the Royal Assent; Schedule
1, on the day after the Royal Assent; Schedule 2 on the 60th day after
the Royal Assent.
Links: The relevant
links to the Bill, Explanatory Memorandum and second reading speech
can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/. When Bills
have been passed they can be found at ComLaw, which is at http://www.comlaw.gov.au/.
The purpose of the bill is to amend
the Broadcasting Services Act 1992 (the BSA) to allow for a staggered,
region-by-region digital television switch-over timetable. In addition,
the bill amends the timing of the two statutory reviews which are required
under the BSA.
As the government noted in the
second reading speech for this bill, the switch-over to digital-only television
will represent the most fundamental change in broadcasting since analog[1] television was introduced in the
1950s.[2] The transition
to digital television has been described elsewhere as a ‘transition from
a world of spectrum scarcity, dumb terminals, and one-way services, to
a world of on-demand programming, intelligent terminals, and abundant
channels’.[3]
Digital television produces more authentic reproductions
of original images than analog television. It does this by converting
information about the elements of a picture to an on/off code that can
identify false data, which a digital receiver is able to correct. Digital
pictures are therefore more authentic reproductions of images than analog
pictures which vary in accordance with the colour and brightness of elements
of the original and which are subject to impairments in the transmission
process that cannot be removed. A major advantage of using digital television
signals is that the digital data stream can be compressed to use available
spectrum more efficiently. As a result, digital broadcasting offers the
potential for the development of other services, such as interactive television
and multi-channelling.
Digital television data requires decoding by a specifically
designed television set or a standard television set which uses a set-top
data conversion box.
In 1993, a Specialist Group was established in what is
now known as the Australian Communications and Media Authority (ACMA)
to consider the introduction of digital terrestrial television in Australia.[4] In its final report published in 1997 this group
considered that a possible date for commencement could be as early as
2000.[5] ACMA supported the specialist group’s finding, recommending
that government worked towards an early introduction of digital television.
In response to this recommendation the Howard Government
introduced its initial digital television legislation in 1998. Under this
legislation spectrum was loaned to commercial and national free to air
broadcasters who were then required to simulcast analog and digital television
formats for a period of eight years. Digital broadcasting was to commence
in metropolitan areas by 1 January 2001 and in regional areas from a date
to be determined. All areas were to have digital services by 1 January
2004.[6]
The Howard Government strategy for the introduction of
digital television was criticised almost from the outset. A Productivity
Commission inquiry in 2000 reflected some of this criticism when it suggested
that at least certain aspects of the digital conversion plan may actually
curtail consumer benefits and increase conversion costs for broadcasters.[7] The Commission labelled a prohibition
on multi channelling imposed on commercial broadcasters and a requirement
which prohibited the allocation of new commercial television licences,
for example, as detrimental to a successful transition. The Commission
considered also that it was crucial to expedite the switch-off of analog
transmissions to deliver certainty to consumers and broadcasters and to
free up the use of spectrum for other purposes. It concluded that a ‘firm
and final date’ of 2009 should be set for both metropolitan and regional
areas for the switch-off of analog television, and argued that this approach
to a switch-over would particularly benefit regional broadcasters who
would no longer need to pay the cost of simulcasting services.[8]
Widespread criticism along similar lines to that of the
Productivity Commission—that various restraints built into the digital
television transition regime jeopardised its success—have continued to
be raised. The Howard Government responded to these in a number of ways
beginning in 2000 with the introduction of legislation ‘to refine arrangements
for the introduction of digital television’.[9]
In its 2001 election policy the former government also
acknowledged that broadcasters needed more flexibility to allow them to
cope with the transition to digital television.[10] It made efforts throughout 2001 and 2002 to
respond to the demands of various broadcasters and at the same time to
encourage the public to embrace digital television, but its transition
plans were consistently hampered by these two factors.
By November 2002, only 35 000 set top boxes had been
sold and the government was forced to launch a digital television education
campaign.[11] This had
had no discernible effect by mid 2003 when the Sydney Morning Herald
commented that the government’s vision for digital television had ignored
the ‘potential pitfalls’ of the conversion process. The Sydney Morning
Herald’s editorial considered that the ‘blunt club’ of shutting down
analog television would be ineffective and that the ‘smarter outcome solution
would have been to encourage an individual player to take the digital
TV … or to allow new entrants, whose revenue would be entirely dependent
on making a go of digital technology’.[12]
In 2005 the government initiated a House of Representatives
inquiry into the take up of digital television. The inquiry concluded
that the original timeframes for the switch off of analog television were
unrealistic. This was not only due to factors such as the lack of consumer
enthusiasm for digital television, but also because it was thought that
equivalent digital services were likely not to be available in some areas
by the proposed switch off date. The inquiry therefore recommended that
the government extend switch off timing to 1 January 2010.[13]
Following the House of Representatives
inquiry, the government consulted with broadcasters before the then Minister
for Communications, Information Technology and the Arts, Senator Helen
Coonan, released a revised plan for digital television conversion in November
2006.[14] The plan
was intended to accelerate the transition by relaxing earlier restrictions
including the prohibition of multi channelling by free to air broadcasters.
They plan also involved commissioning research into the impediments to
digital take up and providing detailed information to consumers about
digital television and the government’s implementation plans for digital
switch over. The switch over date was revised under the plan to some time
between 2010 and 2012.
After Labor’s election victory in November 2007 the new
Minister for Broadband Communications and the Digital Economy, Stephen
Conroy was also confronted by a situation where only around 40 per cent
of homes had converted to digital television.[15]
Like its predecessor the new government needed time to convince people
to adopt digital technology. As a consequence, the Minister Stephen Conroy
announced that the Rudd Government would extend the timeframe for the
completion of digital switch over to the end of 2013.
In seeking to meet this deadline the new government sought
comment on a number of issues which it raised in a legislative framework
discussion paper. These included introducing legislation which would allow
for the option of shortening the analog/digital simulcast period for some
areas that may possibly be ready for full conversion earlier than others.
Another option was to introduce legislation that may deliver more flexibility
to areas to accommodate those experiencing difficulty in achieving switch-over
readiness and a staggered switch-over for smaller geographical areas within
the wider television licence areas for commercial television broadcasting
services.[16]
The measures in this bill propose to amend the BSA to
provide for this type of approach to digital switch-over in regional and
metropolitan areas to accommodate not only the individual needs of various
local geographical areas but also to fit within an overall national digital
transition implementation timeframe.
The approach may be particularly important in a number
of regional television licence areas which were aggregated under provisions
in the Broadcasting Amendment Act 1987. Aggregation involved the
creation of larger - and what were considered more viable - regional television
markets, by combining existing licence areas so that they could be served
by three commercial services. At the time this legislation was introduced,
it was argued that the larger service areas provided through aggregation
would provide an opportunity for licensees to expand and develop regional
content and that the preferences of viewers would provide an incentive
for regional licensees to produce local programs.
By 2001, however, a decline in local radio and television
programming had been noted as a result of aggregation. In response to
this decline, additional licence conditions were imposed in aggregated
areas to ensure that local content was maintained.[17] While this in itself is not the subject of the current bill,
it does illustrate the importance of localism when making policy that
addresses regional broadcasting. In this case, the proposed measures appear
to adopt a similar approach in accommodating the needs of individual areas
in terms of catering to local market conditions.
Apart from introducing changes to licence conditions
to preserve local content on rural television, the former government had
also acknowledged the different conditions that apply to regional areas
as part a National Television Conversion Scheme which commenced on 2 February
2000 and a Commercial Television Conversion Scheme which commenced on
9 June 1999. These conversion schemes require ACMA under Schedule
4 to the BSA to plan so that the ultimate outcome of digital conversion
for broadcasters will be that they achieve the same level of coverage
as they had previously enjoyed in analog mode as soon as is practicable
after the commencement of a simulcast period in a particular area. Each
scheme is divided into two parts; Part A which deals with metropolitan
and regional areas and Part B which deals with remote areas. The legislation
provides that ACMA may determine which areas are defined as remote. In
February 2001, ACMA determined eight licence areas to be remote for the
purposes of conversion to digital broadcasting.[18] Similarly, the 2000–01 Budget included a financial
assistance package under the Regional Equalisation Plan to facilitate
the provision of digital television (and datacasting) services by commercial
television broadcasters in regional and remote licence areas.[19]
The BSA therefore already recognises that special considerations
may apply to different regions and that strategies which are appropriate
for one area are not necessarily so for another. Part B of the conversion
plans for example recognises that delivering services to small, scattered
populations is likely to involve additional costs for commercial broadcasters.[20]
This bill appears also to fit comfortably within a framework
already established under which ACMA consults with stakeholders and guides
digital television implementation plans that take into consideration differing
regional conditions.
This bill also amends the legislation to vary
the timing of two statutory reviews to reflect the government’s intention
to complete the switch over to digital television by 31 December 2013.
These reviews are:
- to the operation of subsection 35A(1) of the BSA. This review will
consider whether new commercial television licences should be allocated
to particular areas and what variations to licence area plans would
need to be made to accommodate such allocations. (Licence area plans,
which are maintained by ACMA, determine the characteristics, including
the technical specifications, of the broadcasting services that are
available in various areas), and
- to the content and captioning rules applicable to standard definition
and high definition multi channel commercial broadcasting services under
subclause 60C(1) of Schedule 4 of the BSA.
The BSA sets captioning quotas for commercial and national
free-to-air broadcasters which require that all prime time programs (that
is programs broadcast between 6 pm and 10 pm) and all news and current
affairs programs are captioned once stations commence broadcasting in
digital format.[21] At
present captioning provisions do not apply to community broadcasters or
to subscription television or to multi channels unless a program has previously
been broadcast with captions.[22]
Content rules set minimum levels of Australian content
to be broadcast by free to air broadcasters, as well as minimum amounts
of first release Australian drama, documentaries and children’s programs
as well as requiring pre-school programming to be Australian. However,
these rules currently apply only to the core commercial television services
of licensees, not to a multi-channel service.
There appear to have been no recent concerns about this
bill raised by relevant interest groups. This may be, as noted, because
the measures continue a framework which already acknowledges that conversion
to digital will require approaches that recognise the different needs
of various regions. This may also be because the government has sought
to address any concerns through consultation with a non-statutory industry
advisory group it has established to support its digital transition strategy.
Amendments regarding the statutory reviews also only change timing, not
their proposed purpose. The membership of this advisory group is:
- Kim Dalton, Director of Television, ABC Television
- Bruce Meagher, Director of Strategy & Communications, SBS Television
- Scott Briggs, Regulatory Affairs Manager, Nine Network
- Annabelle Herd, Network Manager, Broadcast Policy & Strategy,
Network Ten
- Kate Fitzgerald, Acting Manager, Regulatory & Business Affairs,
Seven Network
- Debra Richards, CEO, Australian Subscription Television & Radio
Association
- Julie Flynn, CEO, Free TV Australia
- Shirley Brown, Secretary, Regional Broadcasters Association
- Andrew Brine, President, Australian Community Television Alliance
- Ross Henderson, Chairman, Australian Electrical & Electronic Manufacturers’
Association
- Colin Doyle, Technical Director, Consumer Electronics Suppliers Association
- Michael Lonie, E-Commerce & Tenancy Services Director, Australian
Retailers Association
- Clive Morton, Terrestrial Media Services Director, Broadcast Australia
- James Shaw, General Manager, Analysis & Coordination Division,
Australian Communications & Media Authority
- Jackie Zelinsky, representing the National Community Titles Institute.[23]
In June 2008, the Shadow Minister for Broadband, Communications
and the Digital Economy, Bruce Billson labelled the government’s deadline
for digital switch-over as a ‘naďve, political chest beating exercise’
that did not ensure the future of community television. Billson argued
that one of the reasons the previous government had not adopted a policy
of setting a firm switch-over date was that it was working towards sorting
out critical issues such as the place of community television in a digital
broadcasting world and that the government’s imposition of a fixed switch-over
date was ‘reckless’.[24]
There appears to be no other comment from the political parties in relation
to digital television conversion in recent months.
At its meeting of 25 September
2008, the Selection of Bills Committee resolved to recommend that the
bill be referred immediately to the Senate Environment, Communications
and the Arts Committee for inquiry and report by 25 November 2008.[25] The Environment, Communications and the Arts
Committee has set a time limit of 24 October 2008 for receipt of submissions
from interested parties.
According to the Explanatory Memorandum, the bill is
expected to have minimal impact on Commonwealth expenditure or revenue.[26]
Schedule
1
Existing subsection 35A(1) of the BSA provides for a
review about the allocation of new commercial television broadcasting
licences ‘before the earliest digital television switch-over day’.[27] Item 2 amends the provision so that
the Minister must cause that review to be conducted before 1 January 2012.
Existing subclause 60C(1) of Schedule 4 of the BSA provides
for a review of content and captioning rules applicable to multi-channelled
commercial television broadcasting services ‘at least one year before
the earliest digital television switch-over day’. Item 3 amends
the provision so that the Minister must cause that review to be conducted
before 1 January 2010.
Item 1 of Schedule 1 repeals the definition of
‘earliest digital television switch-over day’ in existing
subsection 6(1) of the BSA. Following the amendments in items 2 and 3
above, the term is no longer referred to in the BSA.
Item 4 of Schedule 2 of the bill inserts proposed
clause 5F into Schedule 4 of the BSA. Proposed subclause 5F(1)
provides that the Minister[28]
may, by legislative instrument:[29]
- determine that a specified area is a ‘local market area’ and
- determine that the area becomes a ‘digital-only local market area’
at a specified time.[30]
The time specified in the determination must be within
the simulcast period: proposed subclause 5F(3).
Proposed subclause 5F(4) provides that the determination
is irrevocable. However proposed subclauses 5F(5)–(10) do allow
for variation of the initial determination by the Minister under proposed
subclause 5F(1) as follows:
- it must not be varied retrospectively: proposed subclause 5F(6)
- the time specified in the varied determination must not be more than
three months before the time specified in the initial determination:
proposed subclause 5F(7)
- similarly the time specified in a varied determination must not be
more than three months after the time specified in the initial determination:
proposed subclause 5F(8).
The three month time restriction imposed by proposed
subclause 5F(8) does not apply in the following circumstances:
- the time specified in the initial determination would be likely to
result in significant difficulties of a technical or engineering nature
for a commercial television broadcasting licensee in the licence area,
or a national broadcaster: proposed paragraph 5F(9)(a), and
- those difficulties could not reasonably have been foreseen by the
commercial television broadcasting licensee or the national broadcaster
as at six months before the time specified in the initial determination:
proposed paragraph 5F(9)(b).
Under proposed subclause 5F(11) the Minister must
consult with the ACMA before making or varying a determination under proposed
subclause 5F(1).
Existing clause 7 of Schedule 2 of the BSA provides that
commercial television broadcasting licences are subject to prescribed
conditions. Existing paragraph 7(1)(m) contains the condition that where
there is a simulcast period for a licence area, the licensee must not
broadcast a television program in SDTV digital mode[31] in that area during the simulcast period, unless
the programme is broadcast simultaneously in analog mode.[32] Item 1 of Schedule 2 of the bill amends paragraph 7(1)(m)
by omitting the words ‘in that area’ and substituting ‘in so much
of that area as is not a digital-only local market area’. The
effect of this amendment is that, once the Minister has made a determination
under proposed subclause 5F(1) that an area is a ‘digital-only local market
area’, the requirement to broadcast simultaneously in digital and analog
modes in that digital-only local market area ceases to be a condition
of a commercial television broadcasting licence.
Part 2 of Schedule 4 of the BSA relates to commercial
television.
Subclause 6(1) is located in Part 2. It provides that
the ACMA must formulate a scheme for the conversion over time of the transmission
of commercial television broadcasting services from analog to digital
mode. Subclause 6(2) provides that the commercial television broadcasting
scheme must deal with both areas that are remote licence
areas and areas that are not remote licence areas.
Item 5 repeals existing subparagraph 6(3)(c)(ii)
and substitutes proposed subparagraphs 6(3)(c)(ii) and (iia).
The effect of this amendment is that the simulcast period will be:
- for a metropolitan licence area – nine years or such other period
as determined under proposed subclause 6A(1), and
- for a regional licence area – eight years or such other period as
determined under proposed subclause 6A(2).[33]
Items 6 and 7 are in identical terms That is,
the words ‘in that area’ and are substituted with ‘in so much of
that area as is not a digital-only local market area’. The amendments
facilitate the setting of different analog switch-off dates in different
parts of a licence area.
Item 8 inserts proposed paragraph 6(3)(ga)
into Schedule 4 of the BSA confirming that one of the policy objectives
of the commercial television conversion scheme is that during the simulcast
period for a licence area, transmissions in analog mode are not required
to be made in an area which has been determined to be a digital-only local
market area.
Item 10 inserts proposed paragraph 6(3)(ja)
into Schedule 4 of the BSA. The proposed paragraph sets out a further
policy objective of the commercial television conversion scheme. The
amendment makes clear that after a local market area becomes a digital-only
market area, the transmission of a commercial television broadcasting
service in SDTV digital mode should have the same level of coverage and
reception quality as was achieved by the transmission in analog mode to
that area.
Item 12 of Schedule 2 of the bill inserts proposed
clauses 6A and 6B into Schedule 4 of the BSA. Proposed clause 6A
allows for a determination of the simulcast period in metropolitan
licence areas and regional licence areas as follows:
- the Minister may, by legislative instrument, determine the simulcast
period for a metropolitan licence area: proposed subclause 6A(1)
- the Minister may, by legislative instrument, determine the simulcast
period for a regional licence area: proposed subclause 6A(2)
- in both areas the simulcast period must end before the end of 31
December 2013: proposed subclauses 6A(3) and (4)
- in both areas the determination is irrevocable: proposed subclauses
6A(5) and (6)
However, proposed subclause 6A(7) does allow for
the Minister to vary the determination by legislative instrument providing
that:
- the variation is not made retrospectively: proposed subclause 6A(8)
- the end of the period specified in a varied determination must not
be earlier than three months before the end of the period specified
in the initial determination: proposed subclause 6A(9)
- the end of the period specified in a varied determination must not
be a date after the earlier of the following:
- the end of 31 December 2013, or
- three months after the end of the period specified in the initial
determination: proposed subclause 6A(10)
Proposed subclause 6A(11) contains an exception
to the requirement that a determination of the simulcast period in metropolitan
licence areas and regional licence areas must end
at the end of 31 December 2013. The exception applies if the following
conditions are satisfied:
- the end of the period specified in the initial determination would
be likely to result in significant difficulties of a technical or engineering
nature for a commercial television broadcasting licensee for the licence
area, or a national broadcaster, and
- those difficulties could not reasonably have been foreseen by the
commercial television broadcasting licensee or the national broadcaster,
as at six months before the end of the period specified in the initial
determination.
In any event, however, proposed paragraph 6A(11)(e)
provides that the end of the period specified in the varied determination
must not be later than the end of 30 June 2014. Before making or varying
a determination, the Minister must consult with the ACMA: proposed
subclause 6A(13).
Proposed section 6B provides that the ACMA must
not determine that the simulcast period for a remote licence area
ends after 31 December 2013 except in those circumstances which the Minister
has specified in the legislative instrument.
Part 3 of Schedule 4 of the BSA relates to ABC and
SBS television.
Subclause 19(1) is located in Part 3. It provides that
the ACMA must formulate a scheme for the conversion over time of the transmission
of national television broadcasting services from analog to digital mode.
Subclause 19(2) provides that the national television broadcasting
scheme must deal with both areas that are remote coverage
areas and areas that are not remote coverage areas.
Item 13 amends existing paragraph 19(3)(c) by
omitting ‘in that coverage area’ and substituting ‘in so much of
that coverage area as is not a digital-only local market area’.
The effect is to amend the policy objective so that national broadcasters
operating in a coverage area during the simulcast period would be required
to transmit in both analog mode and digital mode except in those parts
of the coverage area that have been specified as digital-only local market
areas.
Item 14 amends existing paragraphs 19(3)(f) and
(g) so that the policy objectives under the national television conversion
scheme to which those paragraphs relate need only be achieved in that
part of the coverage area that is not a digital-only local market area.
Item 15 inserts proposed paragraph 19(3)(ga)
into Schedule 4 of the BSA. The proposed paragraph sets out a further
policy objective of the national television conversion scheme. The amendment
makes clear that after a coverage area becomes a digital-only local
market area, the transmission of a national television broadcasting service
in analog mode in that area is not required.
Item 17 inserts proposed paragraph 19(3)(ja)
into Schedule 4 of the BSA. This item also sets out a further policy
objective of the national television conversion scheme, that after a local
market area becomes a digital-only local market area, the transmission
of national television broadcasting service in SDTV digital mode should
have the same level of coverage and reception quality as was achieved
by the transmission in analog mode to that area.
Items 18–20 amend subclause 35(1) of Schedule
4 of the BSA which relates to simulcasting requirements for national broadcasters.
Under the proposed amendments national broadcasters would be required
to broadcast simultaneously in digital mode and analog mode only in those
areas that are not a digital-only local market area.
Items 21 and 22 are application provisions designed
to clarify the commencement of various provisions in Schedule 2 of this
bill.[34]
This bill provides for a variable approach to the switch
off of analog television in metropolitan and regional areas. The Minister
can determine timetables for the switch off of analog television in local
markets within wider television licence areas that take into account readiness
for a transition to digital only television. While the legislation cites
a six month ‘window’ as the norm for a switch over process for identified
areas, it also allows for extra flexibility at the Minister’s discretion
in ‘exceptional circumstances’.
There appears to have been no criticism of the proposals
in this legislation. What criticism that has emerged in relation to the
government’s overall digital conversion plan appears to be directed more
at the intention to impose a more rigid national digital switch over timeframe
than had been adopted by the previous government.
[4]. ACMA was established on 1 July
2005 by the merger of the Australian Broadcasting Authority and the Australian
Communications Authority.
[18]. These are the
licence areas of ITQ Mt Isa, IMP and QQQ Remote Central and Eastern Australia,
WOW Regional and Remote Western Australia, WAW Remote Western Australia,
VEW Kalgoorlie, GTW Geraldton and SSW South West and Great Southern Western
Australia. ACMA, ABA determines remote areas licences for digital television,
press release, ABA NR8/2001, 22 February 2001, http://www.acma.gov.au/WEB/STANDARD/pc=PC_91214,
accessed on 30 September 2008.
[28]. In accordance with section
19A of the Acts Interpretation Act 1901 a reference to ‘the Minister’
is a reference to the Minister for Broadband, Communications and the Digital
Economy.
[29]. The Legislative Instruments
Act 2003 defines a ‘legislative instrument’ as an instrument of a
legislative character that is, or was, made under a delegation of power
from Parliament’. A legislative instrument is put before the Parliament
and may potentially be subject to disallowance.
[31].
Clause 4B of Schedule 4 of the BSA states that a program or a television
broadcasting service is broadcast or transmitted in SDTV digital
mode if the program or service is broadcast or transmitted in
digital mode in a standard definition format.
[32].
Clause 3 of the BSA states that a program or service is broadcast or transmitted
in analog mode if the program or service is broadcast or
transmitted using an analog modulation technique.
Rhonda Jolly and Paula Pyburne
8 October 2008
Bills Digest Service
Parliamentary Library
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