24 December 1998

Mr David Mason

Director, Disability Rights Policy

Human Rights and Equal Opportunity Commission (HREOC)

GPO Box 5218

SYDNEY NSW 1042

Dear Mr Mason

RE: HREOC CLOSED CAPTIONING INQUIRY

Thank you for the opportunity to contribute to HREOC’s closed captioning inquiry. The Australian Subscription Television and Radio Association (ASTRA) has considered the Issues Paper and provides the following comment in response to a number of the issues raised. Apologies for this late submission.

As expected our comment relates particularly to the respective regulatory arrangements applying to free-to-air and subscription television and the policy reasons for such differences. A summary of ASTRA’s comment, if any, in response to specific issues is at appendix A.

THE CONTEXT

Background

By way of background, ASTRA is the peak industry body for subscription (multichannel) television and narrowcast radio. ASTRA was formed in September 1997 when industry associations representing subscription television and radio platforms, narrowcasters and program providers joined forces to represent the new broadcast services.

As you may be aware subscription broadcasting and open and subscription narrowcasting services were new categories of broadcasting services introduced by the Broadcasting Services Act (the BSA) in 1992. These new services have added to the mix of traditional broadcasting services which have dominated Australia’s broadcasting landscape for the past 42 years. They are providing competition and consumer choice in broadcasting, communications, information and entertainment in this country.

Subscription (multichannel) television, commonly referred to as pay TV, the most prominent of the subscription services, was first launched (satellite/MDS) in January 1995 with cable services launched in September and October 1995. So subscription television has been operating for just over three years compared to 42 years for commercial free-to-air television.

By the beginning of 1998 about 750,000 homes were subscribing to pay TV - about two and half million potential viewers - a penetration rate of about 13 percent of Australian homes. In three years, subscription television has made a substantial impact on the way we experience entertainment and information in the home in Australia.

In addition, television and radio narrowcasters are providing niche services Australia wide, catering to audiences largely ignored by commercial broadcasters and providing much needed competition and diversity of services for the Australian broadcasting landscape, as envisaged by the objects of the BSA (see below).

ASTRA’s membership includes the major subscription television operators, as well as twenty stand-alone channels that provide programming to these platforms. Other members include narrowcast television and radio operators providing services such as ethnic language services, racing TV and radio and information radio, and communications companies such as AAPT, Cable & Wireless Optus and Telstra. (See appendix B for list of ASTRA membership).

Subscription television’s progress in the past three years follows a 30 year moratorium before pay TV was allowed to compete with the commercial free-to-air terrestrial services. Once allowed in the original operators were required to use digital satellite and restricted to only eight channels. There was an immediate requirement for new Australian drama expenditure. Advertising was banned until 1 July 1997 and there is still a limit on that advertising revenue, strongly lobbied for by free-to-air commercial television to reduce the competitive impact of subscription television.

In addition, one of the major subscriber drivers, sport, is nobbled by the anti-siphoning list; commercial television operates in a protected market (with no fourth commercial network until the year 2006), and they will soon control the gateway to digital terrestrial broadcasting.

Clearly multi-channel television in Australia remains a long way short of the penetration rate in the world’s most mature pay TV market in the US where up to 70 per cent of homes are connected to cable or satellite pay TV, but it is impressive nonetheless in spite of the risks and costs involved with a rapidly changing regulatory environment which continues to put restrictions in the way of the emerging pay TV sector.

Regulatory policy

In finally introducing new broadcasting services with the regulatory regime of 1992, Parliament set down, for the first time, a set of objects and stated regulatory policy for broadcasting. These set the framework within which the legislation is to be administered and implemented and within which subordinate regulation is to be determined by the Australian Broadcasting Authority (ABA).

In essence the broadcasting regime is one of regulation by exception with the objects to either promote, encourage, facilitate or ensure such important matters as diverse services throughout Australia, diversity in and effective Australian control of the more influential services, the development of an efficient, competitive and responsive broadcasting industry which among other things, reflects a sense of Australian identity, character and cultural diversity, includes high quality and innovative programming, with fair and accurate coverage of matters of public interest and local significance, and programming which respects community standards and is responsive to complaints and the protection of children.

Above all, the BSA should be implemented in a manner consistent with the regulatory policy that provides different levels of regulation for different types for services depending on their degree of influence.

Section 4 of the BSA states:

"(1) The Parliament intends that different levels of regulatory control be applied across the range of broadcasting services according to the degree of influence that different types of broadcasting services are able to exert in shaping community views in Australia."

    1. The Parliament also intends that broadcasting services in Australia be regulated in a manner that, in the opinion of the ABA:

    1. enables public interest considerations to be addressed in a way that does not impose unnecessary financial and administrative burdens on providers of broadcasting services; and
    2. will readily accommodate technological change; and
    3. encourages:

    1. the development of broadcasting technologies and their application; and
    2. the provision of services made practicable by those technologies to the Australian community.

Further, the BSA, at section 5, sets out the role of the ABA to monitor the broadcast industry, produce regulatory arrangements that are stable and predictable and deal effectively with breaches of the rules, and in dealing with those breaches, to do so in a manner that, in the opinion of the ABA, is commensurate with the "seriousness of the breach."

Regulatory neutrality issues

In response to FACTS’ recommendation in the Issues Paper (p.8) that the regulatory requirements applicable to free-to-air services also apply to pay TV services, it should be noted that the regulatory playing field is not level nor is it intended to be level for the very fact that the playing field is not level. All the leverage is well and truly in favour of the incumbent broadcasters, in this case, the commercial television broadcasters represented by FACTS.

FACTS’ assertion that the obligations for closed captioning applying exclusively to free-to-air broadcasters are "irrational and discriminatory" conveniently ignores the regulatory policy of the Act, historical favouritism to the incumbent commercial broadcasters and the distinctive differences between free-to-air and pay TV. It also ignores the fact that commercial television will be the gatekeepers for access to the digital terrestrial spectrum.

Commercial television broadcasters have been given the use of a valuable, limited public resource to exploit, that is the broadcast spectrum, in return for a nominal licence fee (based on a fixed percentage of their revenue) and certain community service obligations such as provision of Australian content. Free-to-air television provides a single channel to a mass audience with no barrier to delivery.

By their own admission commercial television broadcasters continue to be very profitable. Latest Australian Bureau of Statistics (ABS) figures, released November 1998, show commercial television profits of $737 million in the 1996/97 financial year compared to subscription television losses of $1.06 billion. The pay TV losses (for second year of operation) are not unexpected given the enormous start up costs in competing with a sector that continues in a protected oligopoly and has done so for over 40 years.

ASTRA members have made an enormous investment in relation to licence fees and capital costs to establish subscription television, on-line and telephony businesses in metropolitan, regional and remote markets. The sector has also created an enormous number of jobs, investment, infrastructure and content.

Subscription (multi-channel) television broadcasting extends audience choice in terms of the range and diversity of entertainment and information programming. Pay TV services may be delivered by a number of technologies including: multipoint microwave distribution systems (MDS); broadcast direct by satellite to the home (DS or DTH); and broadband cable communications systems (CTV or Cable).

A major distinctive feature of pay TV is the direct contractual relationship between the service provider and the subscriber. This voluntary relationship between the provider of a retail service and a subscriber to that service, provides subscribers with freedom of choice along with the capability and responsibility to select the programs they wish to receive. In this sense, pay TV is in the nature of an invited guest, brought into the home in the full and prior knowledge of the guest's character.

The ABA recognised the unique characteristics of pay TV when it commented in its Final Report on Australian Content for Pay TV that, "Pay TV operates by offering as a package a range of ‘niche’ or specialised programming channels which subscribers must pay to receive. Within this context it enhances viewing options and complements free-to-air services. Pay TV has a smaller target audience to commercial television which is provided free-to-air with no direct cost to the viewer. Pay TV is further differentiated from free-to-air television in terms of the number of different channels, total hours broadcast, reduced advertising opportunities and the niche nature of much of its programming."

 

CODES OF PRACTICE

The BSA sets out a self regulatory regime for broadcasters where the onus to respond to complaints and matters of community concern rests with the broadcaster, in the first instance. It is if and only if a complaint is unresolved or community safeguards have proven inadequate does the regulatory authority (the ABA) step in.

Each broadcasting sector is tasked with developing their own codes of practice to cover matters of community concern as set out at section 123 of the BSA. These matters include, the classification of programs, accuracy and fairness in news and current affairs, advertising time, complaints handling, captioning, and for pay TV licensees, dealings with customers such as billing and fault repair.

Categories of broadcasting services include commercial television and radio, community television and radio, subscription broadcast television and open and subscription television narrowcasting and open and subscription radio narrowcasting.

Codes of practice must be relevant to the particular category of service, must take into account relevant ABA research, must be developed in consultation with the ABA and provide for public comment.

The ABA must register codes of practice for each sector, if it is satisfied the relevant codes provide appropriate community safeguards, are endorsed by the majority of service providers in those sectors and there has been adequate opportunity for public comment. National broadcasters, ABC and SBS TV and radio must also develop codes of practice and notify those codes to the ABA.

The ABA may determine program standards where, in the opinion of the ABA, codes of practice fail ie there is convincing evidence that a code is not operating to provide appropriate community safeguards, or where no code of practice has been developed. The ABA must seek public comment on any proposed standard. Codes and standard can be amended by agreement of both Houses of Parliament. Once determined, standards become a condition of licence for all relevant broadcasters (& narrowcasters).

ASTRA’s codes of practice

ASTRA’s subscription narrowcasting television codes of practice (already registered by the ABA) and its draft open narrowcasting television codes of practice (still awaiting final registration by the ABA) have been developed in consultation with the ABA, the general public and taking into account relevant research undertaken by the ABA.

ASTRA’s subscription television broadcasting codes have also been developed as above and have been submitted to the ABA for registration. These codes apply to all subscription television licensees.

The codes are designed to recognise the fundamental differences between the mass appeal and mass market target of free-to-air television and the niche nature of pay TV. They are especially sensitive to the expectations of the audience about program and advertising content of particular channels at particular times especially as the audience is paying for the service.

The codes are intended to provide clear and consistent information to enable consumers to make informed decisions about the nature of the programming they elect to receive.

Additionally, pay TV operators are committed to the protection of subscribers' interests in all aspects of their service provider-subscriber relationships. This includes issues relating to subscriber options, fault repair, subscriber privacy, credit management and billing, all of which are covered by the codes.

Once registered, ASTRA will monitor the operation of its codes and review them one year from the date of effect. The review will be undertaken in full consultation with the public and representative organisations. If any substantive changes to the codes are necessary such amendments will be made in consultation with the ABA.

ASTRA’s codes of practice for subscription television broadcasting (at Code 2 "Program Codes") and for subscription and open narrowcasting services (at "General Guidelines for Programming") states:

"licensees will not knowingly broadcast any program which is likely to incite or perpetuate hatred against, or vilify, any person or group on the basis of ethnicity, nationality, race, gender, sexual preference, age, religion or disability"...

..."where closed captioning programming is made available it will be clearly identified with program schedule information provided to the press.

When a Licensee (narrowcaster or service provider*) considers introducing closed-captioned programming, or extending the range of programs captioned, it will consult with organisations representing deaf and hearing-impaired viewers and organisations specialising in providing closed-captioning."

* wording for open and subscription narrowcasting television code

Captioning on subscription services

While there are constraints, both technical and financial to the provision of captioned programs on subscription television services, ASTRA is currently in discussion with the Australian Caption Centre (Supertext) and has recently met with the National Working Party on Captioning (10/11/98) to progress issues about access to captioning on pay TV services.

Captioning on retransmitted services

Pay TV services delivered by cable and in some instances MDS retransmit the free-to-air terrestrial services (commercial and national), to provide improved reception and ease of access to these services by subscribers. Retransmission is the simultaneous and unaltered retransmission of the signal of the free-to-air broadcaster.

For example FOXTEL and OPTUS Pay TV retransmit all three commercial networks (Seven, Nine and Ten) and national services (ABC and SBS) in the metropolitan centres in which they operate. AUSTAR retransmits the ABC, SBS, channel Seven and NTD8 on its cable network in Darwin and retransmits Prime television in Tamworth due to an interference problem and SBS in Port Lincoln where it is otherwise unavailable. In the overlap licence area of the Gold Coast, FOXTEL retransmits the Brisbane services from Mt Tambourine in addition to the regional services serving the Gold Coast.

These retransmitted services contain closed captions if included in the free-to-air signal. There are no technical limitations preventing line 21 closed captions from being passed through the system unaffected on the retransmitted services.

OVERSEAS EXPERIENCE

While overseas captioning regimes provide some relevance, it should be noted that the Australian market is very different both in its make up of free-to-air services (in particular, the relative strengths of the commercial and public systems) and dominance of the commercial networks. For example, in the United States, the cable pay TV sector has been well established over a number of decades, with 70% of homes connected. It is highly profitable and an able competitor against the commercial networks. This compares to the Australian market where subscription television has three years experience, continue to book heavy financial losses and is in 13 per cent of Australian households.

DISABILITY DISCRIMINATION ACT (DDA)

ASTRA notes the view of the Commission that the "lack of captioning (on free-to-air television) does not constitute less favourable treatment or direct discrimination under the DDA, because the same signal is transmitted to all viewers of a television service."

As is evident from the discussion in the Issues Paper, the case for ‘indirect discrimination’ is one that still appears unclear. However, ASTRA acknowledges the Commissions’ view that "indirect discrimination" is the applicable concept to be considered, subject to issues of reasonableness and to issues of unjustifiable hardship where applicable, and ASTRA would add, subject to the nature of the particular service.

As stated above, appendix A includes relevant comment on the list of issues for discussion. ASTRA would be pleased to expand on any of the matters raised in its submission (including further elaboration of technical issues).

If you require further information or clarification please do not hesitate to contact me.

Yours sincerely

Debra Richards
Executive Director

Appendix A

SUMMARY OF ISSUES FOR DISCUSSION

Regulatory neutrality issues

As discussed in the text of the submission, television broadcasting services (commercial, community, national, subscription and narrowcast) are governed by the regulatory regime of the Broadcasting Services Act 1992 (the BSA) as implemented by the Australian Broadcasting Authority (ABA).

Any recommendations should recognise this regime and take account of the different categories of broadcasting services; and, the different rules that apply in light of those differences.

Different levels of broadcast regulation apply to different categories of services as per the regulatory policy of the BSA. For example commercial television, licensed to use and exploit the public broadcast spectrum in a protected market, has more onerous obligations, such as Australian content rules, than the category of open narrowcast radio which operates under a class licence, a standing authority to provide a limited type of service, in an open competitive market.

Narrowcast services are defined at section 17 and 18 of the BSA and are services which are limited in some way by such considerations as location, appeal or targeted to special interest groups.

There are also distinct differences in the nature of ‘broadcast’ services as discussed in the text of the submission.

Both the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service (SBS) need flexibility to determine priorities for services in accordance with their individual Charters and separate broadcasting Acts and available appropriated budgets.

The same principles apply as for the use of analog spectrum. The commercial free-to-air broadcasters will acquire a limited public resource to exploit, ie the valuable broadcast spectrum, and in return for such valuable access are required to provide for certain community service obligations such as Australian content and captioning. Commercial television broadcasters will have a unique place in the digital environment as gatekeepers to the digital terrestrial broadcast spectrum.

Relevant digital legislation

Complaints handling by the Commission should acknowledge the self regulatory regime for all broadcasting sectors set down by the BSA as this will continue to apply in the digital environment. As discussed in the text of this submission, this regime is one of regulation by exception with each sector (category of broadcasting) tasked with developing codes of practice to cover a range of community ‘standards’ issues.

The review is to be conducted by DCITA in consultation with the Minister’s Digital Television and relevant Government authorities and community interest groups. The application of the DDA could be an issue for consideration within the review.

ASTRA notes the view of the Commission that the "lack of captioning does not constitute less favourable treatment or direct discrimination under the DDA, because the same signal is transmitted to all viewers of a television service."

As is evident from the discussion in the Issues paper, the case for ‘indirect discrimination’ is one that still appears unclear. However, ASTRA acknowledges the Commissions’ view that "indirect discrimination" is the applicable concept to be considered, subject to issues of reasonableness and to issues of unjustifiable hardship where applicable.

The transition to digital terrestrial television and the ability to provide so much more data within the same amount of spectrum currently providing an analog signal will greatly improve the broadcaster’s capacity to provide captioning.

Within the current analog regime, ASTRA maintains that consideration of achievable levels of captioning must take into account technical and financial constraints, the relative start up phases of new and developing services and the relevant broadcasting regime of the BSA.

Before determining program priorities or quotas, there may be considerable benefit in conducting relevant research for community views on priorities.

It is the ‘live’ and/or immediacy of news and current affairs which imposes a great deal more difficulty (and subsequent cost) than captioning of other program genres. Such difficulties would apply to all ‘live’ programming.

These difficulties apply generally to live/immediate programming but further difficulties may apply on a case by case basis to particular television operations for example, regional and remote commercial and community licensees.

As above

ABA powers and the BSA

As discussed in the text of the submission, codes must be relevant to the particular category of service, must take into account relevant ABA research, must be developed in consultation with the ABA and provide for public comment. These Codes address matters at s.123 of the BSA, including ‘captioning’.

The ABA must register codes of practice for commercial television and radio, community television and radio, subscription broadcast television and open and subscription television narrowcasting and open and subscription radio narrowcasting, if the ABA is satisfied the relevant codes provide appropriate community safeguards, are endorsed by the majority of service providers in those sectors and there has been adequate opportunity for public comment.

Codes of practice are not ‘set in stone’. Codes are monitored (through complaints and relevant research) by broadcasters, the community and the ABA and are also subject to Parliamentary scrutiny. Reviews are undertaken by the relevant sectors to ensure the codes are still operating in accordance with community ‘standards’.

As discussed above, the ABA does regulate captioning on subscription television by virtue of its role in self regulatory codes of practice developed by each broadcasting sector. The codes for commercial, national, subscription and open narrowcasting television, and subscription broadcast television* address "captioning of programs for the hearing impaired" [s. 123(2)(I)] relevant to the operations of these services.

*submitted for registration to the ABA

No comment at this stage.

Relevance of Overseas requirements

As discussed in the text of this submission, the ABA has the power to determine standards where codes of practice fail or are not developed. Proposed standards are subject to public and parliamentary scrutiny and once determined under Part 9 of the BSA become a condition of licence.

The ABA already exercises its power, as appropriate.

As discussed above, the ABA regulates all categories of television services (commercial, community & subscription) in its direct relationship with licensees and has a role in relation to unresolved complaints of the ABC and SBS.

No comment at this stage.

Relevance to complaint handling

As discussed above, complaints handling by the Commission should recognise the self regulatory regime for all broadcasting sectors set down by the BSA.

Information on demand and priorities

As suggested above, there may be a case for relevant research to be conducted to determine demand and priorities.

Constraints on captioning

No further comment at this stage.

No comment at this stage.

News

These issues require further technical consideration.

Regional news

No comment at this stage.

Sport

No comment at this stage.

Other live programming

As discussed above.

Children’s programs

Priority for protection of children from material that may be harmful to them and access to children’s programming (including Australian made children’s programs) is provided for in the BSA. The children’s television standards are determined by the ABA to ensure children have access to programming that is made specifically for them, is entertaining, well made and relevant to their experience.

Captioning is possible and worthwhile for all programming, and as such many programs are captioned without requirements to do so.

Music programming

No comment at this stage.

Standards for quality of captioning & ‘pass through’ of pre-existing captions

Any recommendations must take into account differing technical standards and transmission systems of the various operators.

Responsibilities of producers

Broadcasting regulation is applicable to the licensee (in this case the television operator) as opposed to the program provider. The responsibility of what is broadcast rests with the licensee.

Captioning of advertisements

The Association of Australian National Advertisers (AANA), the Advertising Federation of Australia and the Advertising Standards Bureau may have comment relevant to these issues.

The ABA regulates programming directly with standards for Australian content and children’s television and indirectly with its monitoring of industry codes of practice. Under the BSA "program" includes advertisements.

Capacity of TV receivers to decode captioning

The Australian Electrical and Engineering Manufacturers’ Association (AEEMA) may have relevant comment on this issue. Of concern to broadcasters would be to ensure that technical standards determined for receivers take into account different transmission systems and technical needs of all broadcasters.

Videotape captioning?

Videotape, where consumers choose and pay for programming, from a video outlet, is more akin to pay TV where customers choose and subscribe to a service, than free-to-air television.

Options for Action

Self regulation

As discussed above, the ABA must register a code of practice if the ABA is satisfied that the code provides appropriate community safeguards for the matters covered by the code; the code is endorsed by the majority of service providers; and members of the public have been given an adequate opportunity to comment on the code.

As discussed above, the self regulatory regime applies to all sectors of broadcasting, not just to commercial television which applies the FACTS code of practice. Apart from the FACTS code, the ABA has registered codes which cover commercial radio (FARB Codes of practice); community radio (CBAA Codes of practice), open narrowcast radio, subscription narrowcast radio, and subscription narrowcast television (ASTRA Codes of practice). Codes submitted to but yet to be registered by the ABA include the open narrowcast television and subscription television broadcasting codes.

The ABC and SBS codes of practice have also been notified to the ABA as required.

Market based instruments

No comment at this stage.

Standards

No further comment at this stage.

 

Appendix B

 

 

 

ASTRA membership

ASTRA's members include the main Pay TV operators: AUSTAR; OPTUS PAY TV and FOXTEL;

Channel providers: The Value Network (Australia); Pan TV; Artist Services Cable Management; Odyssey Channel; XYZ Entertainment Pty Ltd; Movie Vision Pty Ltd; Discovery Channel; TV 1; Nickolodeon; Learning Network Pty Ltd; UK TV Pty Ltd; MTV; Sky News Australia; The Premium Movie Partnership; Premier Sports Australia (Fox Sports); Disney Channel; and Satellite Music Australia;

Narrowcast television services: Sky Channel Pty Ltd; Television Oceania; CFM Technology; Information Television; Westlink - Dept of State Services; and Arnbridge;

Narrowcast radio services: 2KY Racing Radio; Really Really Big Productions; Western Visitor Radio; Eazy 88 Cooloola Coast Radio; Radio Austral; Free FM; I&G Pty Ltd; Radio Newcastle; Radio Uno; and 2CR;

Communications companies: AAPT; Cable & Wireless Optus; Telstra; PanAmSat; Australian Satellite and Cablevision Services; CSIRO Radiophysics Division; News Ltd; Totalisator Agency Board of NSW; Peter Pratt; Orbit Electronic Media; and Comsyst (Australia) Pty Limited.

 

 

 

 

 

 

 

 

 

 

 

 

 

ASTRA’S submission

 

 

to HREOC’s closed captioning inquiry

 

 

 

 

December 1998