Wary ACCC stalls on News Corp deal

News Corp Australia’s proposed acquisition of APN’s Australian Regional Media (ARM) may reduce competition in relation to the supply of news and local advertising opportunities, the Australian Competition and Consumer Commission has warned

The ACCC today released a statement of issues about the proposed transaction and called for further submissions before it announces its final decision, expected December 1.

If the transaction is approved, News Corp would own most paid newspapers in Queensland, including paid mastheads in almost all of the state’s 20 largest population centres, with the main exception being Mt Isa where Fairfax Media publishes The North West Star.

The deal would deliver News Corp Australia an additional 12 daily newspapers and 60 weeklies, plus their digital and print infrastructure assets. The mastheads include The Sunshine Coast Daily, Gympie Times and Toowoomba’s The Chronicle.

The deal has been overwhelmingly approved by APN shareholders.

The ACCC’s evaluation of the transaction has paid close attention to the potential loss of competition between ARM’s paid regional newspapers and News Corp’s state-wide paper The Courier-Mail.

ACCC chairman Rod Sims said News Corp owning both The Courier-Mail and local paid newspapers in nearly every city or town in Queensland may result “in a reduction of the quality and diversity of content available to readers”.

“Reinforcing that concern is that both News and ARM have a strong presence in online news through their websites associated with the Queensland newspapers,” Mr Sims said.

“The ACCC is seeking to understand whether the competitive tension between News and ARM is an important factor in maintaining quality and range of content, or whether the threat of readers shifting to alternatives, particularly alternative online news sites, will competitively constrain News after the acquisition.”

In addition to the coverage overlap of The Courier-Mail and ARM’s paid titles, the two parties also both publish community newspapers in areas such as Canoolture/Bribie Island, south west Brisbane, Brisbane northern bayside, Logan and Tweed Heads/southern Gold Coast.

“The ACCC will be assessing the importance of diversity of local content in these competing community publications. The ACCC is also seeking to understand whether advertising opportunities on other media platforms, such as local radio, pamphlets, and online, will constrain prices for advertising in the ARM and News community newspapers,” Mr Sims said.

The ACCC is also concerned the proposed transaction may lead to a reduction in total news offering if News Corp decides to discontinue certain ARM mastheads.

Issues unlikely to raise competition concerns are the supply of advertising opportunities in regional centres and the acquisition of third party content.

The ACCC is accepting submissions from interested parties until October 27.

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  1. Gas the ACCC handed down its decision re News Corp takeover of APN publishing business, which was due yesterday?

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