Juggling a Double Edge Sword

Malcolm Turnbull is definitely under the pump and the pressure is building.

As Communications Minister, he has escalating problems on his plate and many of them are of his own making.

His ‘head in the sand’ approach to commercial radio’s battle with the foreign-owned record companies over the internet streaming of radio programs is just the tip of the iceberg.

Perhaps now, it’s time the Minister started looking seriously at the size of the problems that his own inflexibility on certain issues may be creating, because it could all ultimately come back to bite him in a very public and humiliating way.

While many of his fellow coalition members are turning up the heat in support of commercial radio listeners in the PPCA dispute, the real ‘Elephant in the Room’ for him is the ABC.

By now, we all know the Minister is cutting $50-million a year from the ABC’s taxpayer funding over the next five years.

I have said in previous articles that the ABC should be able to comfortably absorb a cut of that magnitude without a major impact on its services.

The ABC bureaucrats, in a move to protect their own positions and numbers, are desperately trying to prove to all stakeholders that line of thinking is flawed.

However, my rationale on the Corporation’s ability to absorb a 5% annual cut, pre-supposes there’ll no financial surprises, but, for the ABC, surprises may indeed be lurking just below the surface.

Right now, Minister Turnbull appears to be loading the bases on ABC Managing Director, Mark Scott, who may end up having to walk the plank, if he doesn’t play his politics just right!

Mr Scott and his executive team are presently playing right into the Minister’s hands, by cutting on-air programming, in an apparent show of defiance, while preserving ‘the empire’ in the backroom.

They have committed the ABC to a future predicated on the ‘Digital Frontier’, and, they are in the process of doing so at the expense of traditional programming.

This has put them at loggerheads with the ABC’s own creative and journalistic staff, who are facing massive cuts in their numbers in response to the recently-reduced government funding.

Apparently, much of this blood-letting is so that ABC management can keep its ‘digital dream’ alive within the budget cuts.

The trouble with digital delivery, that no one really anticipated when the ambitious plan was conceived and initially implemented, is PPCA.

This association of foreign-owned record companies has a demand in front the Copyright Tribunal that it be paid not only for every song streamed on the internet, but for every single listener stream as well.

You can only imagine what that multiplies out to be when you put the cost-per-song into the equation along with the number of on-line listeners.

The ABC is sitting on more digital streams than the rest of the industry combined, and, they’re not exempt from PPCA’s demands.

Now, here is the dichotomy.

Mark Scott has the government breathing down his neck with overall funding cuts, and, Malcolm Turnbull is refusing to take any political action that would protect the ABC and offer some certainty on the PPCA issue.

If PPCA wins big with its case in the Copyright Tribunal in June, the outcome could end up costing the ABC potentially tens of millions of dollars a year in additional music royalties, that have not been budgeted for.

So, the question without notice now goes to Malcolm Turnbull, and, it relates directly to the double edge sword that he’s currently playing with.

Minister, if you’re going to insist on significantly cutting funding to the ABC, as you have already done, and, you are not prepared to issue a Ministerial Determination defining radio program streaming, then who is going to pay the massive additional streaming royalties for government-owned stations, like Triple J and other ABC music services?

Triple J has no commercial content to offset its percentage of music, so it’s really up the proverbial creek if PPCA is granted everything it’s demanding for the simultaneous streaming of radio programs.

Unfortunately, deep down, we all know the answer to that prickly question.

If PPCA wins, that massive bill is going to have to be borne by all of us; the Australian taxpayers.

The $50-million a year that the government is planning to save through reduced funding to the ABC is probably going to have to be subsidised by providing supplementary funding to the Corporation.

I would have thought this would have defeated the purpose of the initial general funding cuts, but I’m not a politician.

If the Minister insists that those new royalty costs be absorbed internally, the ABC will really have to start cutting into the quality and quantity of the programming it provides.

This is a problem of the Communications Minister’s own making, because he has, and has always had, the power to bring this mess to a close very quickly with a simple Ministerial Determination, which has previously been assured bipartisan support in parliament.

I believe the original cuts the Minister imposed were a worthwhile and measured move to try to make the ABC more efficient and more accountable.

However, ABC management seems to have gone out of its way to rub the Minister’s nose in the dirt, by cutting programming and international news coverage rather than the bureaucratic waste.

Even so, Minister, you can’t have it both ways.

You can’t cut ABC funding and then expect them to meet, from within that reduced budget, potentially tens of millions of dollars of additional music royalties, when you alone have the ability to ensure that common sense prevails.

ABC management might be many things, but they’re not miracle workers.

My concern is that those potential royalties will simply go to boost the coffers of foreign-owned record companies at vast expense to the Australian taxpayer.

Minister, I really believe it’s time for you to step up, consider the deteriorating situation, and, protect taxpayers from a liability that does not need to exist.

About The Author:

Brad SMART has been a journalist, consultant, author, broadcaster, film director and was the former owner of the Smart Radio Network throughout Queensland. Brad can be contacted on email here.  

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