Commercial free-to-air networks are calling for the scrapping of children's and pre-school content quotas, with dwindling young audiences and restrictive advertising making shows difficult to fund.
Ten Network told a parliamentary hearing on Thursday that children are no longer watching its kids' programs, with Ten's audience of five to 12-year-olds usually at around 2,000.
Instead, kids are turning to the ABC's dedicated children's channel and iView, Foxtel's children's channels, Netflix Kids and YouTube, Ten chief executive Paul Anderson said.
Kids' programs are almost impossible to monetise due to the low audience numbers and the restrictive nature of advertising, he said.
"With children not watching these programs, and advertising dollars not available to fund them, this content should be the remit of the national broadcasters ABC and SBS," Mr Anderson said.
Seven West Media chief executive Tim Worner also told the hearing that children are more likely to turn to the ABC's children's channel.
"It is going to be far more likely that Australian children are going to go there to watch their content rather than find it in the isolated pockets where it is on commercial free-to-air television," he said.
"It is neither sustainable nor defensible for commercial broadcasters to be required to spend millions of dollars a year on programs that are watched by only a few thousand child viewers.
"Children just do not watch children's programs on free-to-air television anymore - it is something that just doesn't happen."
The broadcasters are also calling on the government to make its interim $127 million licence fee cut, delivered in June, permanent.
A key component of the media reform package announced in the federal government's May budget includes replacing broadcasting licence fees with cheaper spectrum usage charges.
Both Seven and Ten said a permanent reprieve from fees would allow the savings to be reinvested into Australian production.
"We work hard at coming up with Australian programming which now must stand out in the crowd," Mr Worner said.
"But hitting these goals requires investment and it requires Australian media companies to remain viable.
"(The package) helps us invest in a future where Australian stories are still a vital part of our lives."
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