The Australian government on Aug. 31 outlined major potential changes to media ownership rules that would unbuckle many restrictions that broadcasters and publishers currently face for cross-media exp

SYDNEY (The Hollywood Reporter) -- The Australian government on Aug. 31 outlined major potential changes to media ownership rules that would unbuckle many restrictions that broadcasters and publishers currently face for cross-media expansion here. Foreign ownership rules also would be loosened under the proposal.

The changes were outlined by Sen. Helen Coonan, Minister for Communications, Information Technology and the Arts, at a speech to the National Press Club in Canberra.

The ruling Liberal/National Party coalition has been pushing for media ownership reform for some years but that has been subject to compromises due to a hostile senate. Previous amendments had created "a fairly complex package," Coonan admitted. However, the coalition now controls the senate and is keen to institute -- in consultation with the industry -- what it believes are long overdue reforms.

"The forces of [technological] change are unstoppable and, while they do challenge some business models, actually present real opportunities to embrace new ways of doing business and to provide significant benefits to consumers," Coonan said.

New delivery platforms and media convergence "are challenging the effectiveness of existing regulatory structures," she added. "Media policy has traditionally achieved its objectives by closely controlling who may enter the market and what services they may offer.

"In my view, regulatory strategies need to move away from relying on controlling market structures in the way they have to date, to a new framework that allows some efficiencies of scale and scope while encouraging new players, new investment and new services."

Current cross-media rules prohibit control of more than one commercial television license or two commercial radio licenses or an associated newspaper in the same license area -- such as a major metropolitan area.

There are also limits which prohibit control of more than one television or two radio licenses in a market, or commercial television licenses that reach more than 75% of the population.

"I am considering an approach where mergers could take place between the regulated platforms -- television, radio and newspapers -- within a license area," Coonan said. "This would mean, for example, there could be common ownership of a television license, two radio stations and an associated newspaper, or other combinations, in the same market."

That theoretically means News Corp. -- through its Australian operation News Ltd. -- would be able to acquire TV interests, as could newspaper publisher Fairfax.

Coonan said such mergers would be subject to having a minimum number of commercial media groups in the relevant regional and metropolitan markets -- four "voices" in regional markets and five in mainland state capitals.

"Obviously, under this approach, the scope for mergers would be far greater in metropolitan areas," Coonan said.

She said the changes would not extend to national broadcasters, pay TV, the Internet or out of area newspapers and other potential new services over other platforms which "provide increasing and important additional sources of news and opinion."

Coonan also said the government was committed to removing restrictions on foreign investment -- currently capped at approximately 15% -- in commercial and pay TV operations. However, such investment would need to be approved directly by the Treasurer, while any mergers would be scrutinized by federal broadcasting and antitrust regulators.

"While it may not be possible to have legislation introduced by the end of the year, I would certainly like to be in the position of having a settled framework by that time which I can take forward early in 2006," she said.

At press time, Coonan's plan was denounced by the entertainment and journalists main union, the Media, Entertainment and Arts Alliance, with federal secretary Christopher Warren telling local press that the changes would halve the number of existing media players.

"This will mean fewer media companies and less diversity of news, views and opinions," he said.