From the Oz: TV station off the list for Fairfax

It seems unlikely that the media reforms will result in some massive orgy of consolidation and diversity crushing. Firstly, as Fairfax CEO David Kirk illustrates, media companies are reluctant to jump whole-heartedly into technologies which are increasingly being seen as obsolete, or at least shrinking. The first week of July saw the lowest ratings for broadcast television in the US in recorded history. In Australia, Foxtel is installed in now around 1/3 of households, having quietly increased for years. News Limited recently acquired not more traditional tv stations, but MySpace. Understandably, TV stations aren’t really seen as hot property.

Secondly, lowering the media specific merger laws does not nullify the economy-wide competition law. ACCC chairman Graeme Samuel has repeatedly noted that any proposals for media mergers will be looked at just as carefully as they look at any other mergers. Certainly, the definition of what consitutes a market will be now a point of contention, but given the ACCC’s rather imperialistic attitude towards its jurisidication, I think we can expect a competition regulator rather reluctant to allow too many of these mergers to go through.

“Lefty Tim”, of Australian Big Brother 2005 fame, has set up a website Lazy Pollie Watch, designed to track and shame politicians that Tim considers aren’t working hard enough on tax-payers dollars.

As his first target, Jackie Kelly is criticised for appearing on the TV show Torvill and Dean’s Dancing On Ice, instead of working to funnel federal dollars to people she hopes will vote for her.

But for those who hope for more libertarian political leaders, this is exactly what she should be doing. Kelly may have identified that there are two ways to get votes - pork barrelling or dancing on network television. Tim would like her to spend all her time competing with other politicians to divert money into her electorate. This is not a healthy competition. A dancing competition, however, could at least help lower the obesity rate, and provide much needed light entertainment in this cold hard world.

Jackie Kelly could spend all day watching re-runs of I Love Lucy for all I care, just as long as she isn’t spending all day thinking of new and exciting ways to spend other peoples money. Tim would no doubt disagree.

Link via The Spin Starts Here.

Basic primer on a libertarian approach to antitrust laws from Jeff Miron:

To begin, the amount of monopoly power that would exist without antitrust appears modest. Cartel members often cheat by undercutting the monopoly price. Innovation usually erodes monopoly power. Free trade provides competition even when the number of domestic firms is small.

Even when monopoly or cartelization exist, moreover, antitrust has undesirable side effects.

(via Newmark’s Door) He continues to list some of those side effects in the post.

Thinking about Australian media and competition law, number 8 (”Antitrust, like other policies, suffers from “mission creep.”) is clearly evident. I’ve written in the past (here, page 7,, here and here) on the likely possibility that the ACCC will treat ‘premium’ content as a bottleneck for internet and mobile video services. In this case, Australian competition authorities are shifting past a strict interpretation of what constitutes a media market in order to gain jurisdicational control over another converging, but historically seperate industry.

The current state of media and communications transformation provides a great opportunity for regulators to move into areas previously outside of their domain. Media regulators have had jurisdiction over content decisions for decades, but now, under the banner of ‘convergence’, the ACCC is extending its reach. Given that there has been very little content regulation on mobile and internet services until now, this is a most unwelcome development.

Some chilling news for Russian freedom:

These are unmanned aerial vehicles. And maybe the time will come for gigantic robots. However, so far we have put our main hope on people.

Link via Hit and Run.

Title edited - does ‘former USSR’ mean Russia today, or the USSR? A semantic point I would rather not dwell on.

A fun game with the today’s announced media reform policies: compare with the discussion paper of earlier this year and try to spot the difference.

Apart from a little bit of fiddling around the edges - and i mean edges - I can’t spot anything which could possibly be considered substantial.

My submission from April is here, as well as a related submission to the ACMA.

The latest IPA Review has been released today. My article “Scandinavian Idol” looks at the popular obsession with the Swedish welfare model. Few public policy debates do not refer to Swedish policies as desirable solutions to local problems. But upon further investigation, Sweden’s economic prospects are not as strong as popularly believed.

The cover story is on fair trade coffee. Its a great magazine - you should all buy at least one copy, preferably four.

Paul Watson wonders why I argued here that “radical change over the past 30 years has inundated media companies with competition.”

Why specifically 30 years? Technological change has been constant. As I argue in my article, increasing economies of scale brought about by innovation dictated the content of newspapers in the late 19th century. A similar change occured in the print business after the Second World War. Further changes in printing technology - the increased use of offset printing - drastically lowered the cost of small print runs, allowing independent, often ephemeral magazines to proliferate. The variety of print publications on the newstand rapidly increased. More recently, digital printing has lowered the cost further.

But the last 30 years has seen a huge change. The easiest example is the VCR, and, contrary to Paul’s psychoanalysis (I wasn’t alive in the 1960s), the reason which I use this timeframe. It is hard to overestimate the long term consequences of the VCR and its descendents. Few entertainment technologies are more empowering for consumers. The VCR freed them from the timing and content decisions of others. Associated technologies - like cameras which ran on videotape rather than film - lowered the cost of production.

There are a huge range of technological changes since then, which I won’t try to list. But think about these technologies which have changed the way we consume and produce media - the walkman, the camcorder, video game consoles, mobile telephones.

Sure, government policy for broadcasting has been woeful. Pay television has been underwhelming, but takeup rates are, slowly, climbing (Foxtel recorded their very first profit recently!). But television is not the only content we consume. Our entertainment choices are not restricted to watching free to air television or twiddling our thumbs.

In this sense, the internet did not change everything. Everything was already changing well before. The internet and cheap personal computing has merely shoved it in our faces - it made this radical change obvious to all.

A short disconnected point, as I think about Paul’s arguments: Citizen Kane is more of a metaphor than a true comparison. Kane Newspapers enjoyed no monopolistic dominance of the press - his ill-fated candidacy for governor was only ill-fated because of his competition. With a true monopoly, he would have been able to suppress the news about the affair which was his undoing.

At least I’ve made up for my oped drought earlier this year: I have a piece in the AFR today, online here: “Regulator should butt out on fibre-optic broadband“

Rich with public policy implications, this study combining happiness research with obesity crisis-mongering:

Fat people are not more jolly, according to a study that found obesity is strongly linked with depression and other mood disorders.

Whether obesity might cause these problems or is the result of them is not certain, and the research does not provide an answer, but there are theories to support both arguments.

Why must science continue to slay our sacred cultural myths? Link via Hit and Run.

I have an Age today on the obesity ‘crisis’: “You are what you choose to eat”

It is a tribute to Australia’s prosperity that people in poverty are more likely to be overweight than underweight. But rather than a celebration of the achievements of economic growth, this has instead led to cries of an “obesity epidemic”.