Reform of regulation of Australia’s screen industry now underway

The next stage of media regulation reform is now underway in Australia with the Australian Government announcing a ‘media reform package’ as part of the 2020-2021 Federal Budget. While more reforms are anticipated in 2021, the initial announcement has reached a position on a number of items put up for consultation in the Supporting Australian stories on our screens – options paper (Options Paper) earlier this year.

These initial reforms will affect a number of stakeholders from the screen, broadcasting and digital platform industries, including broadcasters, streaming video on demand (SVOD) services, Screen Australia, production companies, producers and screenwriters.

The big ticket items include:

• greater flexibility for free-to-air television broadcasters in meeting drama, children’s television and documentary content quotas, including the ability to now meet one quota by broadcasting a mixture of the three content types provided a separate documentary content cap is observed. Free-to-air broadcasters will also be able to meet content quotas through their primary channels or multi-channels;
• introduced reporting requirements for streaming services. Under the reforms, streaming services such as Netflix, Amazon Prime, Disney+ and Stan will be required to report to the Australian Communications and Media Authority (ACMA) on their Australian content spend. This will allow the Australian Government to gauge how much large digital platforms are investing into the Australian screen industry. We consider this information may be used (among other purposes) to inform future content quotas;
• reduced drama program expenditure quotas for subscription television broadcasters (such as Foxtel) will be implemented through amendments to the Broadcasting Services Act 1992 (Cth), with the change being a drop from 10% of spend per drama channel to 5%;
• $53 million worth of additional funding for 2021-22 to support the development of Australian content. This will be particularly aimed at developing Australian drama, documentaries and children’s screen content as well as to develop a Screen Writing and Script Development Fund for Australian content; and
• changes to Australian Screen Production Incentives to streamline television and feature film offsets, including increases to the Producer Offset for television content to 30 percent, changes to the qualifying Australian production expenditure (QAPE) thresholds for both film and television mediums and caps to the level of copyright expenditure that can be claimed at 30 percent of total production under all three offsets.

While Australian content quotas have not been imposed on SVOD services (yet), the announced initial reforms are the first step in striking a better balance between regulation of traditional broadcasters and SVOD platforms. Notably, the easing of content quotas on broadcasters for drama, children’s television and documentary programs will provide broadcasters an opportunity to focus on streaming more profitable content, notably reality television.

Still, as noted in the Options Paper, drama, children’s and documentary content are important screen genres from a cultural perspective. While more flexible content quotas for broadcasters may have an impact on those in the screen industry, particularly those who produce drama, children’s and documentary content, the reforms aim to mitigate this impact by increasing funding for Australian content, particularly these genres. Whether or not this strategy is effective will become apparent in 2021.

If you are a broadcaster, online platform or work in the screen industry and require further information on these initial media regulation reforms, please contact a member of our Digital and Intellectual Property team.

This publication covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. It is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.