The bid by News Corp executive chairman Lachlan Murdoch and WIN founder Bruce Gordon, although given the green light by the Australian Competition and Consumer Commission last week, was effectively on hold because of current, antiquated media laws.
The two-out-three rule, which would be repealed under the proposed new laws, prevents Mr Murdoch and Mr Gordon owning Ten because of other media interests.
The Murdoch bid was made conditional on the passage of the laws, which were withdrawn after opposition from Labor and the Greens and, finally, the Nick Xenophon Team over amendments the minor party proposed in regard to media tax offsets.
The success of the CBS bid for the indebted network was supported enthusiastically by Opposition leader Bill Shorten, who essentially rolled out the welcome mat for the American company, and declared there was no need for media law reform.
‘I’ve got no doubt this … shows the government needs to park their unnecessary media reforms,’’ Mr Shorten said. ‘‘The case for abolishing the two-out-of-three rule was to save Channel Ten. Well, CBS has saved Channel Ten, so we don’t need to tamper with media diversity laws. I say welcome CBS, welcome Down Under.’’
Mr Shorten’s statements angered media executives, who saw the failure of the Senate to pass the reforms as the reason CBS was able to launch a successful bid.
Fairfax chief executive Greg Hywood attacked Mr Shorten over his continued opposition to media reform and his distorted comments in regard to Channel Ten.
“The Leader of the Opposition … knows full well that media law reform in this country is not and was not aimed at ‘saving’ Channel Ten,” he said. “Media law reform is about allowing the commercial media to compete effectively in an era of major structural disruption. I urge Mr Shorten to reconsider his position so that the news and information being provided to local and regional communities is not compromised.”
The Nine Network also called for the reforms to be expedited. “We support the package as a whole and remain hopeful that the parliament will pass it as soon as possible,” a Nine spokesman said.
Prime Minister Malcolm Turnbull said Mr Shorten should stop making excuses for opposing changes to ownership rules.
“What Bill Shorten is doing by opposing these reforms is he’s guaranteeing that foreign-owned media companies will continue to be able to advance at the expense of the Australian businesses that are shackled by outdated regulations,” he said.
“It’s about time Shorten woke up to himself and recognised that the only beneficiaries of his opposition to media law reform are Google, Facebook, Netflix and Amazon.”
In its editorial on Tuesday, The Australian Financial Review was scathing in its criticism of the Opposition Leader.
“Bill Shorten says ‘welcome CBS, welcome Down Under’. So goes the self-serving hypocrisy of a Labor leader who crows over having maintained pre-internet era media ownership rules so that an American media company can snatch a struggling free-to-air TV broadcaster from the locals,” it said.
“This is the Labor leader who sneers at big business and who parades himself as the protector of the Aussie battler. That is, until this conflicts with his own political self-interest in punishing his perceived media enemies.”
In terms of media reform, the editorial said: “If maintained, the two-out-three rule will make it harder for these home-grown media companies – the ones more likely to maintain substantial local news operations – to compete. That will more likely reduce genuine media diversity, not improve it.”
While the CBS bid has been accepted by Ten’s receivers, PPB Advisory, it still has to be cleared by shareholders, the courts and the Foreign Investment Review Board. The acceptance by shareholders is not a given, with a group already in discussions with legal firms over a possible class action.
CBS aims to hold 100 per cent of Ten by settling the broadcaster’s debts, including $98 million to the Commonwealth Bank and $33 million to investors James Packer, Lachlan Murdoch and Bruce Gordon. However, shareholders will get nothing for their stock.
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