Digital television and its discontents: competition policy and broadcasting in Australia

In Australia the problem of sustaining competition in a digital broadcasting environment does not arise, because competition is all but prohibited by existing media law. Instead the issue is whether digital broadcasting can facilitate the appearance of new players and new services. In 1999 media law in Australia was for the first time subjected to a review guided by the principles of the country's competition policy. A powerful, highly concentrated industry with a history of protection and politicking was examined by the Productivity Commission, an independent economic advisory body. The Commission recommended far-reaching changes to almost every aspect of mediapolicy, but was especially critical of the anti-competitive aspects of Australia's rules for digital television. This article describes the Commission's approach to the problems of applying competition policy to broadcasting regulation. It seeks to explain a problem at the heart of the Commission's deliberations: for reasons which may well be specific to Australia, the conversion to digital broadcasting is crucial to achieving greater competition in Australian media. But at the same time, it appears unlikely that a successful switch-over to digital can occur without new services and new players creating demand. A resolute new policy direction is therefore essential.