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Competition concerns raised about WA newspaper sale

Seven West Media’s proposal to purchase The Sunday Times and website PerthNow from News Corp Australia may be likely to raise competition concerns for both readers and advertisers, according to the Australian Competition and Consumer Commission.

The ACCC released a Statement of Issues document this week outlining its preliminary findings on the deal, which would effectively make Western Australia a one newspaper state.

SWM owns The West Australian, which could become a seven-day-a-week operation if the acquisition of The Sunday Times is approved.

The ACCC is now seeking further submissions from interested parties before it makes a final decision on the sale, which is expected to be announced on September 15.

ACCC chairman Rod Sims said several interested had already expressed concern about reduced competition and reduction of diversity of content.

“A number of advertisers have also raised concern about the loss of competition for advertising opportunities in the print newspapers,” Mr Sims said.

“WAN (Western Australian Newspapers) and News appear to be each other’s closest competitors in print and online news in Western Australia. They compete strongly with each other to attract readers and advertisers.

“The ACCC is seeking to understand whether the competitive tension between WAN and News is a key factor in maintaining quality and diversity of content for readers, or whether the threat of readers shifting to alternatives, particularly alternative online news sites, will competitively constrain.”

The ACCC noted the deal was unlikely to raise competition concerns regarding the acquisition of content from third parties, such as newswires, or in relation to online advertising.

The Statement of Issues also found online news sites, as well as other mediums such as TV and radio, are not a substitute for advertisers attempting to reach certain audiences by using newspapers.

Therefore, newspapers should be considered a separate market.

SWM and News Corp also intend to enter into a number of arrangement relating to content sharing, advertising re-sale and printing and distribution.

The ACCC is accepting submissions on the deal until August 18.

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