Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015
July 27, 2015
I rise today to speak on the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, an important subject in my electorate of Durack with its diverse population of 90,000-odd spread across 1.6 million square kilometres, the biggest and most remote electorate in Australia and the second biggest electorate in the world. SBS, with its multicultural television program offering, provides a very valuable service to the people of Durack and, indeed, the people of Australia.
The bill proposes changes to SBS in terms of advertising, product placement and revenue opportunities for SBS. It includes measures that provide SBS with increased flexibility on the scheduling of advertising and clarifies SBS's ability to earn revenue through product placement during programming. It does not change the current restrictions on the overall amount of advertising—120 minutes per 24 hours. Importantly, this does not represent the commercialisation of SBS. SBS currently has a limit of five minutes of advertising per hour, adding up to 120 minutes a day. Like other broadcasters, SBS earns the majority of its advertising revenue during peak viewing times between 6 pm and midnight or when broadcasting special quality events such as Eurovision, about which we have just heard in great detail. This bill would enable SBS to schedule up to 10 minutes of advertising at higher rating times and less at slower times during lower rating programs. The 120 minute daily cap remains unchanged, as opposed to the 350 minutes per day that commercial broadcasters can allocate to advertising and revenue generation.
Like advertising, product placement—such as perhaps wearing a West wetsuit or showing someone drinking a glass of exquisite Leeuwin Chardonnay—earns revenue and subsidises the cost of actually making television programs. With more flexibility of product placement, SBS could increase its earnings—in particular, during the broadcasting of popular cooking programs. Currently SBS acquires programs for broadcast which contain product placement. However, this placement has been made by and for third parties well before SBS has considered acquiring and broadcasting the program.
Due to the ambiguity currently in the SBS Act, SBS does not currently use product placement in its own commissioned programs. Obviously, this needs to be changed, and we need to create a level playing field. Accordingly, the bill amends the SBS Act to specifically allow SBS to earn revenue through having product placement in its own programming. I welcome this. The new measures will inevitably lead to an increase of approximately $28.5 million in SBS's advertising revenue over four years from 2015-16. This, of course, is against the backdrop of a reduction of funding to SBS of some $50 million.
Opposition to the amendments that I have been speaking about are of course to be expected. It is the way of the commercial world and the way of those opposite as well, but I make this next point very strongly. Let's consider 2013-14, which was the World Cup year with higher-than-normal ratings. SBS earned some $73 million in revenue from advertising and sponsorship while the commercial networks earned $3.9 billion. This represents a share of less than two per cent. This means that, when the proposed amendments become law, even if SBS's revenue growth were at the expense of commercial broadcasters, it would constitute a minimal impact on their overall revenue.
I refer to the submission to the Senate Environment and Communications Legislation Committee regarding the amendments we are discussing here today. This submission was made by the Federation of Ethnic Community Councils of Australia, also known as FECCA. Not surprisingly, FECCA has expressed its disappointment over the funding reduction; but, notwithstanding the budget cuts, FECCA still supports this bill—specifically schedule 1, which provides SBS with its advertising flexibility. In supporting the bill FECCA notes that the change will not increase the daily advertising limit of 120 minutes currently permitted but will potentially lead to that $28 million that I referred to earlier in net incremental revenue opportunities up to 2018-19. FECCA believes that the additional advertising revenue is necessary to ensure the role of SBS in supporting multicultural communities is not diminished.
The proposed amendments must be debated in the context of their value to society as a whole. Australia, as we know, is a multicultural society, and SBS was created to service our population by providing appropriate cultural and linguistic broadcasting services. Nothing has changed. Australia remains proudly and fiercely multicultural. Remember: with the exception of Australian Aboriginals, we are all migrants in this country. Australian people have been drawn predominantly from the people of other nations and have built a great nation. As a nation of migrants, we celebrate our origins in numerous ways, from festivals to Australia Day and Harmony day, and, of course, in food, entertainment, history and also heritage. We collectively rejoice in our uniqueness and the hard work of our migrants, who have created this nation and our have-a-go approach to life.
Last year, new Australian citizens were drawn from more than 150 countries, and we proudly claim to the world and to our own to be one of the most culturally diverse countries in the world with our rich mix of colour, flavour and movement. As a community, as the parliament, as a nation and as the member for Durack, we are all very proud of the bipartisan support for multiculturalism in Australia. In my remote and rural electorate of Durack we have at least 160 different countries represented. Seventy-two per cent were born in Australia, with the balance born in places as diverse as Vietnam, Yemen, South Sudan, Monaco, Greenland, Mexico and Botswana. More commonly, though, you will not be surprised that they were born predominantly in England, New Zealand, the Philippines, South Africa, India, Germany and Ireland.
We all know of the high value of SBS to our constituents. Indeed, I am also a fan of SBS and its diverse program offerings that reflect the culture of my friends, neighbours and constituents in Durack. As we continue to debate the amendments to this bill let us give heed to the fact that SBS provides us a much-needed quality service, from education in news to education in current affairs to the Australian population, not only for our ethnic brothers and sisters. Yes, it is a service, and, like all services, it is one that my government is proud to support.
The Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 includes measures that provide SBS with increased flexibility in the scheduling of advertising and clarifies SBS's ability to earn revenue through product placement during programming. In the interest of long-term sustainability SBS must be allowed to move with the times, change, find ways to generate more income and provide a service for our Australian multicultural groups. It is all about balance—balancing the imperatives of commercial TV with the requirements of a special broadcasting service.
Now more than ever SBS has an important role to encourage and promote tolerance, understanding and acceptance of multicultural Australia. It must be sustainable and is important to be here for the long haul. On that basis, I recommend this bill to the House.