Nola Marino (Forrest, Liberal Party) Share this | Hansard source

I rise to speak on the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015. I was interested in one of the comments made by the previous speaker, and that was that SBS puts ads on television in the middle of the night when no-one is watching. I can imagine that sales pitch to a potential advertiser: 'Have we got a deal for you! We're going to put your ads on in the middle of the night when no-one is watching; you can pay for these ads, but actually no-one is ever going to be watching them!' What a comment to make; that is just astounding. The interesting thing from the previous speaker, too, was again he is living in a different world—totally ignoring the billions of dollars in debt and deficit left by the previous Labor government, which he was very much a part of. That is the one thing that has been missing in much of the debate.

SBS is the youngest of Australia's five free-to-air networks. It is a multicultural broadcaster specifically aimed at Australian citizens for whom English is not their native language. It was first announced in the late 1970s in Western Australia. Perth was added to the network in 1986; we had to wait awhile. Labor planned to merge SBS with ABC in 1987. That was one of the things that I noted as part of doing some work on this particular bill. Of course, SBS operates under a mixed funding model.

While the majority of SBS's operating budget is funded by the Australian government, the remainder is drawn from SBS's commercial activities. It certainly would not be drawn too much from ads put on the middle of the night deliberately so that no-one would see them. I think that you would be struggling to sell that concept. Commercial activities include advertising and sponsorship, but not those put on at time when no-one is watching or no-one is going to pay to advertise.

But, like all other areas of government, we have to deal with the facts. We have to deal with the financial situation left to us by Labor. We cannot pretend that the debt and deficit is not there. In 2014, the Department of Communications conducted an efficiency study to identify savings that could be made in the back-of-house operations of the ABC and SBS. Of course, in conducting the review, the government intended to dispel the myth from the other side of politics that savings can only be achieved by cutting programming or services. In spite of the comments from those opposite, the target was savings that could be made without reducing the resources available for programming.

In 1990, SBS was originally given government approval to seek sponsorship funds for the telecast of the FIFA World Cup. That was the predecessor of SBS in this place. The study that was done in looking at targeting savings made without reducing resources available for programming identified an opportunity for SBS to earn additional advertising revenue without increasing the maximum amount of advertising that it was permitted to show over a 24-hour period. SBS currently has a strict limit of five minutes of advertising per hour, which is a maximum of 120 minutes of advertising shown each day. However, like all the commercial stations operating in Australia, SBS earns the majority of its advertising revenue during peak viewing times, which is completely contrary to what the member for Blaxland had to say. This includes the daily peak hours of 6 pm to 10 o'clock at night and when it broadcasts special events such as the recent soccer grand final, the Tour de France or the soccer world cup.

We need to allow a more flexible approach, enabling greater advertising at times of better viewing numbers. This flexibility is essential. This bill will enable SBS to show up to 10 minutes of advertising per hour during higher rating programs to increase its overall advertising revenue, but allow it to stay within the daily overall limit of 120 minutes. The counterbalance will require SBS to schedule less advertising during other hours so that the 120-minute daily cap is not exceeded. Again, in spite of the comments we heard opposite, the 120-minute daily cap on advertising is still well below the 350 minutes per day that the commercial broadcasters can devote to advertising. Members should note that SBS has many programs, particularly sporting programs, which have natural breaks that are suitable for advertising well in excess of the five-minute limitation at present. We should also note, and it should not be forgotten, that it has been SBS's soccer coverage which brought the game to Australian prime time television for the first time. The FIFA World Cup telecasts have delivered the networks highest ever ratings.

We also should note that SBS does not currently fill 100 per cent of the time that it has available for advertising across all channels and markets, particularly in the case of regional markets, where SBS is regularly unable to fill five minutes of advertising per hour per channel, even during peak evening viewing times when its higher rating programs are generally shown. In markets with insufficient demand, the additional flexibility afforded by the proposed measures is unlikely to result in significant change to the amount of advertising that SBS attracts. So the benefit of this is most likely in the metropolitan markets.

The additional advertising revenue received by SBS is highly unlikely to have a material impact on the advertising revenue of the commercial broadcasting industry, totalling $3.8 billion in 2012-13 and $3.9 billion in 2013-14. In contrast, SBS revenue from advertising and sponsorship over the same period was just $58 million in 2012-13 and $73.4 million in 2013-14—a share of less than two per cent. The 2013-14 figure represents a peak due, as I said, to SBS's coverage of the 2014 FIFA World Cup. In a non-world cup year advertising revenue is less, at around $50 million to $60 million—around a 1.5 per cent share. It is anticipated that the SBS advertising measures will result in an increase in SBS's advertising revenue of around $28.5 million over four years from 2015-16.

The ABC and SBS efficiency studies also identified an opportunity for SBS to earn additional revenue through the use of product placement. Product placement is well known and recognised in commercial television, especially in cooking and food programs and sporting programs, where a branded good is promoted within the show itself. It is the fee a company pays to have their products either used or displayed, essentially to convince the viewer, the potential customer, that the product is the choice of the show or the star or a character. However, it goes much further than this in movies and the wider media all the time. Product placement is widely used to earn additional revenue and subsidise the cost of content production. SBS currently broadcasts programs purchased from all over the world which already contain product placement. However, SBS does not use product placement in its own commissioned programs due to a lack of clarity in the Special Broadcasting Service Act regarding its use. Not all programs are suitable for product placement, but some are.

This bill amends the SBS Act to specifically allow SBS to earn revenue through having product placement in its programming. It requires the SBS board to develop and publicise guidelines regarding the use of product placement, and to report on its use and earnings in the annual report. The same requirement exists in the SBS Act for the use of advertising and sponsorship announcements.

In the short term, additional advertising revenue will be directed towards meeting the government's efficiency savings from 2015-16, and making minor technical amendments to the Australian Broadcasting Corporation Act 1983 and the principal SBS Act to provide consistency with other broadcasting legislation and to remove redundant provisions. The amendments involve the insertion of some broadcasting definitions and terms in the SBS Act to make it consistent with the Broadcasting Services Act 1992 and the ABC Act, and to reflect the SBS activities that are provided in the current converging digital environment. It also removes redundant definitions in the ABC and SBS acts about election periods. In addition, the bill repeals a range of provisions from communications portfolio legislation which are spent or otherwise unnecessary. Repealing unnecessary legislation within the communications portfolio will ensure regulation only remains in force for as long as it is actually needed, and that remaining legislation is easily accessible.

This bill will give SBS an incentive to seek out new advertisers and advertising opportunities. It is important to note that SBS, being the multilingual and multicultural service in this space, is not just in entertainment. The information it broadcasts is critical. I can recall my own mother-in-law, who did not speak much English at all and certainly could not read English. For many years, until she was able to receive SBS programming, she often worried unnecessarily about, particularly, women's health issues. She would not necessarily believe the information that was given to her by her daughters or daughters-in-law, but when the information came by way of SBS and programs she could understand herself and hear for herself—when she received this information first hand—it was of immeasurable value to her, and to many other Italian women who lived in that community. It was information from an independent source, and it gave her information that she had not previously had access to.

SBS, as we know, is a vehicle for wonderful understanding—a connection—between the many different groups in Australia. It comments and connects on cultures and beliefs, on generations and intergenerational issues, for interest groups and various language communities. Having seen it first hand in a small community like Harvey, I know there are many others around Australia for whom this is such an important service. Look at the SBS charter—it must really meet the communication needs of Australia's multicultural society, including ethnic, Aboriginal and Torres Strait Islander communities, and it must increase awareness of the contribution of diversity of cultures in the continuing development of Australian society. These are very worthy parts of its charter, particularly in the current environment, that promote understanding and acceptance of the cultural, linguistic and ethnic diversity of the Australian people. In facing some of the national security challenges that we do, that understanding and that acceptance of cultural, linguistic and ethnic diversity are probably more important now than they have been—but for far different reasons. On that basis, I commend the bill to the House.

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