Media Ownership and Advertising

This essay provides an analysis of media ownership in Australia and the implications of the merger between Fairfax Media and Nine Entertainment Company. It discusses whether media should control what is said and whether advertisers should exert influence on the media. The essay highlights the concentration of media ownership in Australia and the potential impact on the content shown and said. It also explores the role of advertisers in shaping media portrayal. The conclusion emphasizes the need for unbiased and independent media.

Running head: MEDIA OWNERSHIP AND ADVERTISING
MEDIA OWNERSHIP AND ADVERTISING
Name of the student
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Introduction
Australia’s media landscape has seen a remarkable change in the recent years. Media in
Australia is highly concentrated with two major companies ruling the scenes – Fairfax Media and
Nine Entertainment Company. However, with the big merger of Fairfax Media and Nine
Entertainment Company, new doors of opportunities and controversies related to the media in the
country have opened. The merger came after the Malcolm Turnbull government eliminated the
laws on cross-media ownership that was in place from the 1980s. The cross-media ownership
laws had prohibited the media companies from having the ownership of over two platforms that
included TV stations, radio stations and newspapers. The decision came after the media
companies complained about the increasing influence of Facebook and Google who are the
dominating figures in digital advertising. Now, with increased power over the media, the media
would have greater control over what is to be shown and said.
The essay aims to provide an analysis of media ownership in Australia, the meaning of
the merger between the two media giants, whether media should control what is said and whether
advertisers should exert influence on the media on the way they are portrayed.
Discussion
Media ownership
The Broadcasting Services Act 1992 lays down the media ownership controls in
Australia. Despite the presence of laws regarding the ownership of media, the media in Australia
is highly concentrated, as stated earlier. The newspapers and national channels were owned
majorly by two corporations namely News Corp which belong to the media giant Rupert
Murdoch and Nine Entertainment owned by Peter Costello. While News Corp accounts for

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almost two-thirds of the circulation in the metropolitan region, Nine Entertainment Company
owns the rest of the circulation. The News Corp, Nine Entertainment Company and Seven West
Media, together own the Australian Associated Press (AAP) that distributes the news and later
sells to other news media houses such as the Australian Broadcasting Corporation. Though the
AAP draws majority of the mainstream news every day, other exclusive pop culture news are
drawn by the privately owned media houses. The government owns two media houses namely
the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Services (SBS).
The Australian media ownership also reaches out to the community where the Australian
Communication and Media Authority (ACMA) have allocated frequencies of radio and
television to community broadcasters. The government funds these community media
broadcasters. Known as the Australian Community Media, it the community media has
stronghold over the states and territories (Theage.com.au, 2019).
In an article published in The Conversation in 2016, it was revealed that Australia leads
in the media ownership concentration from many countries. The article also reported that the
media ownership concentration in the newspapers section is the most compared to others
(Theconversation.com, 2019). News Corp and Fairfax Media together dominated the majority of
newspapers in the national and capital city. However, after the merger of Nine Entertainment and
Fairfax Media, it is more likely that the company would dominate all the three media platforms.
The company, now known as Nine, would have a strong presence in all the formats including
print, television, radio and the inline platform. This has been made possible by the abolition of
the cross-media ownership laws in 2007 after the Howard Government implemented the
Broadcasting Services Amendment (Media Ownership) Bill 2006 through Act No. 129 of 2006.
The concentrated media ownership in Australia has been an issue for long and according to

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Reporters Without Borders, the concentration has become even greater in 2018 after the merger
(Rsf.org, 2019).
Merger of Fairfax and Nine Entertainment Company
In one of the biggest mergers of the decade, two of the media giants in Australia
announced the completion of their merger. Fairfax Media and Nine Entertainment Company
completed the merger in July 2018 after approval from the federal court. The deal was sealed
after Federal Court judge, Justice Jacqueline Gleeson approved “the Nine-Fairfax scheme of
arrangement, paving the way for final implementation of December 7, 2018” (McDuling, 2019).
The merger was strongly opposed by Antony Catalano and Aurora Funds Management. While
Mr. Catalano argued that Fairfax could have had a better deal with such huge numbers of share,
John Patton, the Aurora managing director expressed concerns about the change in the share
prices. Hugh Marks, the CEO of Nine Entertainment Company is the leader of the combined
group. Many consider the deal to be a takeover rather than a merger because the shareholders of
Fairfax received cash and some shares of Nine to give control of their company to Nine. The
appointment of Hugh Marks as the leader and the naming of the combined group as ‘Nine’, also
points towards the takeover.
The deal has led to the creation of Australia’s largest domestic media company with
around six thousand employees and a dominant presence across all media platforms. The
company is most likely to generate annual revenue of around 3 billion dollars and total earning
of around 480 million dollars (Abc.net.au, 2019). The reason is that Nine dominates the
television platform being the second-rated network whereas the Fairfax owned Sidney Morning
Herald and The Age have the largest cross-platform audience. Herald has the largest audience

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while The Age stands at fourth in terms of audience. With the merger, questions have arisen in
the minds of many readers and journalists as to what it would mean for them (McDuling, 2019).
The questions that arise the most are whether Nine would control the content in all the
newspapers run by Fairfax. The board members of Nine have signed the “charter of editorial
independence” of Fairfax, which means that it would not interfere in the newspapers for any
reason – political or commercial. Apart from that, Nine has also promised that it would not stand
in the way of any reporter wanting to criticize any work of Nine. To many journalists and other
employees in both the companies, they might lose jobs. O’Shea (2019) however highlights
another concern of such a merger. The author states that the merger of local Australian
newspapers and news channels increasingly result in the unreported scandals that are taking
place in the society. The author presents examples of many scandals that include local scandals
as well that might go unreported. When it comes to the influence of the merger on the Australian
media landscape, there would not be many changes because the newspapers would remain the
same. However, changes might occur in the television and online platform with Domain being
provided increased exposure on Channel Nine. this is because the parent company wishes to
compete strongly with its rival News Corp and its REA Group.
The media owners decide what is said
The media, be it print, television, radio and online, is dominated by those who own it.
The fact is true because it has been proved repeatedly by the various controversies that have
come up. The media houses have some liability against those who own them and they would
most likely show what the owners want them to show. When a company or an individual owns
the media, it is bound to have bias towards a certain political party or politician. Examples
abound in the sphere of media regarding the controversies surrounding the media houses of

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controlling the content of the news channel or newspaper. In one of its many controversies,
Rupert Murdoch owned Fox News has been involved in supporting a particular political party or
an individual. The channel was accused of favoring the Republicans and giving more negative
news about the Democrats. The inclination of Fox News towards the Republican Party could be
traced back to 2000 when John Prescot Ellis was the team manager for the channels projection
team. Ellis was the then president George W. Bush’s cousin (Theguardian.com, 2019).
The ownership of the media or those involved with the media should not decide the news
or content of any news because this creates an atmosphere where the audiences no longer trust
the mainstream news channels. Many media giants have been involved with controversy
regarding the portrayal of any particular individual or party that showed biasness. The American
media giant CNN (Cable News Network) in 2007 was accused of being biased against the
Republicans. In a study by the Shorenstein Center on Media, Politics and Public Policy of the
Harvard University, it was revealed that the CNN broadcast majority of negative news against
the Republican candidate. The study revealed that CNN broadcast 41% of stories negatively
about the Republican candidate while the positive stories constituted only 14%
(Shorensteincenter.org, 2019). Around 46% of the stories were neutral thus demonstrating that
the media company had a bias towards a particular party (Shorensteincenter.org, 2019). This
happened because Ted Turner, CNN’s founder was inclined towards the Democrats rather than
the Republicans. In 2016, Turner even encouraged the campaigning for Democrat representative
Hillary Clinton. This shows that it is not fair for those owning the media to decide what needs to
be said and what is said in the news.
The advertisers exert influence

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One big part of today’s mainstream and social media is advertising. The advertising
agencies now exert such influence that was not there to be seen some decades ago. The
advertising industry has emerged as the new giant in the media where it has the power to
understand customer’s perception. The advertising industry now has varied platforms from
where it could exert its influence over the consumers. The social media is one such platform that
has given immense power to the advertisers. However, it has often been seen that the advertisers
exert too much influence on the media in terms of the way they are portrayed. The advertisers
might belong to particular political parties or to some big corporation. At times, the advertisers
use the media to propagate an issue that might be controversial. One example of propaganda
could be given of the BBC or the British Broadcasting Channel where it seemed to propagate an
anti-Brexit approach. As Toby Young, a conservative journalist wrote in The Daily Telegraph,
“the broadcaster devoted an entire day of live programming to migration” (Telegraph.co.uk,
2019). The writer further stated that the BBC spent an entire 24 hours in propagating an anti-
Brexit campaign by focusing on migration and the reasons refugees came to Britain. The
broadcasting of such program was clearly meant to drive the pro-Brexit people to change their
minds. This might not be a clear case of advertisers influencing the media but it does give a clue
as to the way the mainstream media is used to propagate for or against an issue. As Cho, Huh
and Faber (2014) hold, the advertisers mainly exert influence on the commercial media. The in
the commercial media industry, the advertisers shape the editorial policy of the media and this
happens due to the financial pressure that the advertisers exert. The advertisers have influence
over what needs to be shown in the media. This influence is detrimental for the consumers in
particular because they demonstrate immense trust on the media. Therefore, it is not fair for the
advertisers to influence their portrayal in the media.

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Conclusion
To conclude, it could be stated that the media-scape has transformed drastically in the
contemporary era owing to numerous factors. The essay provided a detailed analysis of the
changing media landscape and the influence of other factors over the media. Firstly, the essay
discussed the media ownership in Australia where it found that majority of the media is owned
by private companies. In the sections that followed, the essay talked about the big merger of
Fairfax Media and Nine Entertainment Company and its implications on Australia’s media
sphere including the journalists and the companies. The analysis found that the merger resulted
in the loss of jobs for many while it also led to the dominance of one media group over majority
of the media in Australia. The essay then discussed whether it is fair for the owners of the media
to decide what is said. The essay lastly explained that it is not good for the advertisers to exert
influence on the media on the way they are portrayed.

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References:
Abc.net.au (2019). What the Fairfax and Nine merger means for you. [online] ABC News.
Available at: https://www.abc.net.au/news/2018-07-26/what-the-fairfax-and-nine-merger-means-
for-you/10039236 [Accessed 19 May 2019].
Cho, S., Huh, J. and Faber, R.J., 2014. The influence of sender trust and advertiser trust on
multistage effects of viral advertising. Journal of advertising, 43(1), pp.100-114.
McDuling, J. (2019). Fairfax-Nine's deal is set to reshape the media landscape, and not
everyone is thrilled about it. [online] The Sydney Morning Herald. Available at:
https://www.smh.com.au/business/companies/fairfax-nine-s-deal-is-set-to-reshape-the-media-
landscape-and-not-everyone-is-thrilled-about-it-20180727-p4ztxt.html [Accessed 19 May 2019].
McDuling, J. (2019). What does the Nine-Fairfax merger mean?. [online] The Sydney Morning
Herald. Available at: https://www.smh.com.au/business/companies/what-does-the-nine-fairfax-
merger-mean-20181204-p50k1o.html [Accessed 19 May 2019].
O’Shea, M., 2019. Rocky times: Local Australian newspapers are merging, closing and losing
circulation which leaves scandals unreported. Index on Censorship, 48(1), pp.57-59.
Rsf.org (2019). Australia : Investigative journalism in danger | Reporters without borders.
[online] RSF. Available at: https://rsf.org/en/australia [Accessed 19 May 2019].
Telegraph.co.uk (2019). The BBC's focus on immigration was a whole day of anti-Brexit
propaganda. [online] The Telegraph. Available at:
https://www.telegraph.co.uk/news/2016/05/16/the-bbcs-focus-on-immigration-was-a-whole-day-
of-anti-brexit-pro/ [Accessed 19 May 2019].

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Theage.com.au (2019). Rural Press, Fairfax officially merged. [online] The Age. Available at:
https://www.theage.com.au/business/rural-press-fairfax-officially-merged-20070510-
gdq3ov.html [Accessed 19 May 2019].
Theconversation.com (2019). FactCheck: is Australia’s level of media ownership concentration
one of the highest in the world?. [online] The Conversation. Available at:
https://theconversation.com/factcheck-is-australias-level-of-media-ownership-concentration-one-
of-the-highest-in-the-world-68437 [Accessed 19 May 2019].