Darce Cassidy's response to Robert Manne
In August 2003 the Melbourne Age carried an article by Robert Manne, Professor of Politics at Latrobe University, who argued that the ABC was grossly underfunded and since it was unlikely that either the Coalition or Labor would fund it properly, then it should take “between program” advertising like the SBS.
Professor Manne argued:
A few years ago SBS introduced between-program advertising. This has interfered neither with the content of SBS news and current affairs nor with the enjoyment of its viewers, who do not endure the crass interruption of programs taken for granted by commercial TV. With a revised charter, requiring the ABC to maintain its independence from both government and business, and with a truly independent board, I do not see why between-program advertising need compromise in any way any activity of the ABC.
Friends of the ABC spokesperson Darce Cassidy responds.
In their 1999 Study, Public Service Broadcasters Around the World, commissioned by the BBC, the management consultants McKinsey and Company mount a strong case against advertising on public service broadcasters.
Their review of 20 broadcasting markets on four continents focused on the issue of competition in those markets. It found that competition in broadcasting markets was strongest when the public service broadcaster took no advertising, and weakest when the pubic service broadcaster received a substantial income from advertising.
McKinsey argued against greater regulation of the media, but in favour of supporting advertising free public broadcasters, which would “combine creative and market pressures on broadcasters to achieve a society’s aims for its broadcasting market”
The McKinsey study finds “Our analysis shows clearly that an increased dependence on advertising has led inexorably to an more populist and less distinctive schedule.” It goes on to argue that the less distinctive a public broadcaster is the less impact it makes on the overall market, and the less competitive it is.
On the other hand distinctiveness alone is not enough. The public service broadcaster must be large enough, well funded enough, and mainstream enough to have a significant market share. Without that, it has no real market power, and therefore no real competitive impact.
You say that advertising has not interfered with the content of SBS news and current affairs, nor with the enjoyment of its viewers, who do not have their programs interrupted by advertising.
It is tempting to think that. It is tempting to think advertising on the SBS will be contained on the periphery There are strong pressures within the SBS for it to grow. Managing Director Nigel Milan has already floated the idea of giving up the “between programs” limitation. The story of how sponsorship developed into advertising in the U.S. is relevant.
In the early days of broadcasting sponsorship or advertising was widely condemned. Erik Barnouw, author of the definitive three volume history of broadcasting in the United States wrote that Herbert Hoover, while Secretary of Commerce, said that it was “inconceivable that we should allow so great a possibility for service to be drown in advertising chatter”
When radio was first established sponsorship announcements were discrete, never personal. Barnouw describes how under the unofficial rules prices were not to be mentioned, samples were not to be offered, store locations were taboo and personal items such as toothpaste were questioned. The clothing firm of Browning King was content to attach its name to an orchestra. The fact that Browning King sold clothes was never mentioned. The Browning King Orchestra simply played nice music. Other sponsors followed and stations rushed to sign up the Kodak Chorus, the Ipana Troubadours and the Goodrich Silvertown Orchestra. In the meantime the National Association of Broadcasters proposed that sponsorship announcements be banned from prime time listening, on the basis that it was family listening time.
All this changed with the 1929 crash. CBS, one of the major networks was in trouble. George Washington Hill, President of American Tobacco, came to the rescue. Cremo cigars were suffering from rumours that they were made with spit. He needed to counter the rumours, and was prepared to pay. CBS capitulated, and in between tunes from the Cremo Military Band an announcer shouted: “There is no spit in Cremo.” NBC soon followed suit, sponsorship became advertising, and aggressive.
Australia has relatively diverse broadcast media because we have three distinct funding models. The ABC does not have advertising, but is subject to influence by government. To some degree it has been protected by its arms length relationship with government, and a tradition of independence. It has never, of course, been fully independent, and its limited independence is under challenge.
The commercial media are dependent on advertisers, but much less so on government (except when they need to do deals to change the rules – like those applying to cross media ownership.)
The community sector depends primarily on volunteer labour and public subscriptions. Unfortunately the initial rules preventing advertising have now been relaxed in the community sector, and many community stations, particularly in regional areas, are now dependent on advertising. A look at the number of complaints against radio stations that have been upheld by the ABA in the first half of this year shows that the great majority of adverse findings by the ABA relating to radio are about excessive advertising by so-called community stations.
In commenting on the then media ownership rules Henry Mayer said that it mattered comparatively little whether Rupert Murdoch or Kerry Packer or Conrad Black owned the media. What mattered more was how they were financed. With three distinct sectors, financed in three distinct ways, by advertising, by government and by community organizations, we have some guarantee of diversity. Advertisers have already invaded the community sector. They already largely control the commercial sector. They have a foot in the door at the SBS. Only the ABC is advertising free.
You are right when you say that neither the government nor the opposition have much time for the ABC. Yet most Australians do, and they are prepared to pay more for it. The National Social Science Survey, carried out in 1999 and made available to Professor Glenn Withers of the ANU in March 2000, found that "the average willingness to pay for the ABC was 30 per cent higher than the 1999 actual mean outlay ($48 per head versus $37). " The survey found that taxpayers wanted to pay less for social security, defence, industry assistance and a range of other government services, but were willing to pay more for the ABC.
In view of the above I think it is too early to give up.
