Opening statement from SBS Managing Director to Senate Hearing on Prominence and Anti-Siphoning Bill
26 February, 2024
The following is a transcript of SBS Managing Director James Taylor’s opening statement delivered on 23 February, 2024 to the Senate Standing Committees on Environment and Communications hearing on Communications Legislation Amendment (Prominence and Anti-siphoning) Bill 2023.
Thank you for the opportunity to appear today. I’d like to start by giving you a direct account of our experience, to demonstrate why this legislation is so critical.
In June 2018, the manufacturer of the best-selling connected TV in Australia wrote to SBS and advised that unless we agreed to a 15% revenue share arrangement and a placement fee, SBS would be removed from the ‘app launcher’ on the TV homepage for that brand.
When SBS refused to pay, the manufacturer carried through on their threat making it much harder for audiences to find the SBS On Demand app.
Then, in August 2020, that manufacturer delivered the same demand, but this time threatening to take SBS On Demand off the platform entirely. It was difficult for me to even find a representative in Australia for us to challenge this with – a reflection of how these corporations are imposing their global commercial rent seeking activities from thousands of kms away with no regard to local audiences or the public interest.
In August 2023 we received notification from another platform operator that unless SBS agreed to pay them 30% of the revenue we derived from being on their platform, they would exclude us entirely.
That platform operator has a market capitalisation of over USD$1.7 trillion.
It is frankly scandalous that these massive global tech firms can unilaterally insert themselves as gatekeepers between Australians and their free Australian content, trusted news and information – services that have been intentionally developed and underpinned by decades of public policy.
These are examples of the corrosive impact the unregulated marketplace is having – it’s a free-for-all, where foreign entities essentially control what Australians see on their devices and can kick off a public broadcaster that has a particular remit to serve vulnerable and marginalised communities.
Let’s be clear, these devices, or smart TVs, are essentially empty black boxes but for the content, be it news, sport or entertainment, paid for and delivered by content makers like SBS. People buy televisions to watch content.
The set manufacturers do not pay a cent towards the content they are seeking to grab revenue from – the very definition of rent-seeking. They know the power they have over the primary access point to content in the home, and they are squeezing it for all it’s worth.
Ubiquitous access to free television services that deliver valuable news and Australian stories are the result of purposeful public policy interventions over many decades. And Australians rely on these services – especially those who can’t afford to pay for streaming.
We warmly welcome the Bill and wish to see it passed as soon as possible, with a small number of crucial amendments.
Clearly this is worth doing – but it must be done now. We are very concerned about the unjustifiable 18-month delay in commencement of the prominence provisions, which appears to be based on a misunderstanding of likely compliance lead-times.
This unwarranted delay will significantly compromise the effectiveness of the Bill and unduly delay the benefits to Australian audiences that it seeks to deliver. Failure to apply the framework retrospectively on TVs currently in homes or in stores will also mean the majority of Australians will continue to face barriers in accessing the public broadcasting content they have already paid for.
Let me put it another way – in the next 18 months there will be general elections in the United States, United Kingdom and Canada and Australians will go to the polls by the first half of 2025. Surely we want Australians to have access to the kind of trusted, impartial news and information that SBS and the ABC provide so they can understand the issues and participate fully in the democratic process.
ABC iView and SBS On Demand could be kicked off these connected TV platforms at any time – hence this legislation is urgent. 67% of SBS On Demand consumption comes via connected TVs – this stands to impact a lot of Australians.
We support an amendment which would see the Minister have powers to make regulations regarding implementation timeframe, which should be no longer than 6 months from the date of assent. The obligations should also apply for sets already manufactured which are still receiving software updates.
It is worth remembering that under this proposed framework users will still have complete control over the apps on their TVs – nothing in the legislation prevents someone from customising their home screen, adding or deleting apps as they wish. All this legislation does is ensure that local, free services are available and visible as a default – giving us a fair shot at reaching our audience and fostering a healthy media ecosystem where both local and international players can flourish.
Thank you and I welcome your questions.