Despite almost two years of intensive lobbying, the Australian government&#0146s bid to change the country&#0146s media ownership regulations was defeated late last week. Last minute negotiations failed to deliver the votes necessary to pass the bill in the Senate.

The controversial legislation, known as the Broadcasting Services Amendment, would open the Australian commercial media to greater levels of foreign investment and reduce restrictions on cross-media ownership.

Existing regulations divide the industry into the &#0147queens of screen&#0148 and the &#0147princes of print.&#0148 No company can own more than one type of media organisation &#0151 TV, newspaper, or radio &#0151 in the same region. Foreign organisations are restricted to a 30 per cent ownership in national or metropolitan newspapers, and a 20 per cent ownership of a television license. There are also special rules governing the ownership of media outlets in regional areas and provisions for maintaining a minimum level of Australian content.

The government says many of these restrictions are anachronistic, encourage mediocrity, and unduly inhibit competition and growth.

&#0147The existing regulatory regime is starting to look like one of those long-buried ordinances that regulate the watering of horses in Little Collins Street but failed to anticipate the arrival of the motor car,&#0148 Minister for Communications, Richard Alston told the Melbourne Press Club. &#0147Quite simply, Australia&#0146s media laws were written for another time. And like the ordinance regulating horse watering, our media regulations are not so much unworkable as irrelevant&#0148

In its original form, the Broadcasting Service Amendment would have permitted ownership of all three types of media in the same area provided each maintained separate editorial and content management policies. Foreign ownership limitations would have been determined by government policy rather than specific legal restrictions.

Opposition to these changes from other political parties, free speech advocates, and academics was fierce. Critics argue that media ownership in Australia is already too concentrated, and that changes to the legislation would lead to mergers between the nationâe(TM)s largest media players.

&#0147This legislation is ultimately about the future of Australian democracy,&#0148 said Lindsay Tanner, the Labor Party Shadow Minister for Communications. &#0147It is about guaranteeing that we do not end up in the situation where a handful of people control the vast bulk of Australia&#0146s mass media.&#0148

The debate over media ownership has been a hot political issue since the introduction of the current rules in the mid-1980s. Prime Minister John Howard has advocated deregulation of the industry since coming to power in 1996, actively pursuing the policy since the 2001 election.

While acknowledging that restrictions on foreign ownership need modification, the Democrats, Labor, and Greens Senators considered the Broadcasting Services Amendment &#0147a repeal of the cross-media laws rather than a reform, and so should be opposed outright.&#0148

The government entered protracted negotiations earlier this year with the four Independent Senators that control the &#0147swing vote&#0148 in the upper house. Indicating they might support the passage of an amended bill, various formulas for determining media concentration were proposed. Their demands also included stricter local content guidelines in regional markets and increased funding for the nation&#0146s two public broadcasters.

Last week, a compromise was reached between the Government and Independents that would restrict a company to owning only two of three possible forms of media in the capital cities and regional areas. Potential mergers would also be blocked unless five independently owned media organisations remained in the capital cities or four in regional areas.

&#0147At the moment we&#0146ve got about five or six major commercial media organisations in this country,&#0148 says Labor Shadow Communication Minister Lindsay Tanner. &#0147If this legislation [goes] through in the form the Government wants, that five or six will shrink to three.&#0148

Alston claims the changes would not serve the interests of the &#0147entrenched&#0148 media moguls, but help the small to medium sized organisations that need capital and new markets. &#0147We think the protections we have in this country are world&#0146s best practice and we&#0146ve improved those via this legislation.&#0148

The tentative agreement was broken this week when Independent Senator Brian Harradine moved an amendment to restrict any company from owning both a newspaper or television station in the same capital city. Explaining his decision, Harradine said, &#0147I can’t accept that letting the big players make large cross-media purchases to form a combined newspaper-television group is in the interests of the general public.&#0148

&#0147If you look at the amendment, it still allows for a lot of movement from the cross-media ownership point of view,&#0148 said Independent Senator Shane Murphy. &#0147It allows people to expand into radio; it allows them to expand into pay TV, and, by removing the foreign ownership controls, it means it allows for new voices. What it doesn’t allow for is for some of the big players to just get bigger.&#0148

The Labor Party, Greens, Democrats, and Independents passed the amended bill on Wednesday. In response, the government used its majority in the House of Representatives to remove Harradine&#0146s amendment before returning it to the Senate for further debate. Despite several last minute attempts at a compromise yesterday, the Senate voted to reject the unamended bill.

&#0147That final amendment is really a dagger through the heart of cross-media reform,&#0148 Minister Alston told the Australian Broadcasting Corporation. &#0147It simply wouldn’t achieve any of the objectives that not only our Government but governments around the world are increasingly recognising as desirable.&#0148

Democrats Senator John Cherry dismisses such criticism. &#0147The Senate&#0146s acting in the interests of the public by preventing further concentration.&#0148

The Government has indicated the bill is likely to be reintroduced when Parliament resumes in August, but acknowledged that it would probably be defeated again.