The former prime minister Kevin Rudd has called on the Morrison government to intervene to support the philanthropically funded newswire service, Australian Associated Press 2.0, warning that the diversity of Australia’s media is at stake.
The head of Australia’s competition watchdog, Rod Sims, also said he would be watching closely to ensure News Corp Australia does not abuse its market power when it launches a rival service after its non-compete clause ends in five months’ time.
“No government should let a single company control the biggest newspapers in every capital city bar one, plus a television station, plus the national newswire,” Rudd said. “Let alone an American billionaire like Murdoch …
“Rupert Murdoch has no interest in Australians having diverse sources of media. He is an instinctive monopolist.”
Rudd said he feared News wanted to “finish the job” of killing the AAP newswire by launching its own.
“And what will Morrison’s Liberals do about this? Nothing. Why? Because Murdoch runs their protection racket.
“Take a look at how Murdoch bought up hundreds of regional APN newspapers, some of which had been running for more than a century, and then so brutally closed them down so his big city mastheads could move in.
“Does anyone really think reporters at Rupert’s newswire won’t be subjected to the same political pressure as they are at the Australian, Daily Telegraph, Herald Sun and Courier-Mail?”
Just a month after its relaunch, AAP announced on Monday that it would launch a crowdfunding campaign to supplement subscriptions and support from philanthropists who came together in June to buy the 85-year-old wire service.
AAP was faced with closure in March after its then chief executive, Bruce Davidson, said it was no longer viable, and its major shareholders, News Corporation Australia and Nine Entertainment (the publisher of the former Fairfax mastheads), were no longer prepared to fund the service.
But the service was saved after an 11th hour rescue by staff and philanthropists.
News Corp has now created an in-house breaking news division, NCA Newswire, to provide content to its publications and it plans to offer the service to other clients. The company is subject to a non-compete clause which has five months to run.
“I wouldn’t say it’s a complete natural monopoly, but AAP is covering things where you don’t necessarily want five journalists covering it, like courtrooms and less high-profile stories,” said Sims, the chairman of the Australian Competition and Consumer Commission.
“You want it to be independent, that’s the point. You want it to stay that way and so we followed the sale process – we wanted to be sure there was nothing anti-competitive going on there – and we are following it very carefully now.”
He said much would depend on how News Corp priced its new service.
“We know what pricing was offered when News was the majority shareholder,” he said. “News had slightly more than 50%.
“The relevant law is misuse of market power. The law says that you can’t engage in low pricing for the purpose or effect of damaging a competitor.”
On Monday AAP 2.0 acknowledged it was already facing some headwinds owing to the fallout from Covid-19, which has hit the media industry hard, and would seek support from the public for its service.
AAP’s chief executive, Emma Cowdroy, said some clients had signed for “much shorter periods” as they may be “testing the service and they also know there is a new entrant coming into the market”.
The company provides coverage of courts, crime, politics and sport to more than 400 media outlets, many of which use the service to supplement local or more in-depth coverage.
“They need AAP to round out their offering,” Sims said. “It’s important to media diversity, it’s important for competition in the media. You have to have the ability for new players to enter the market and for small players to thrive. That’s what gives us a competitive landscape.”
The crowdfunding campaign has the backing of high-profile media personalities including Annabel Crabb and Michelle Grattan and is winning support from several politicians, who have been outspoken about News’ influence in Australian media.
The former Sydney lord mayor Lucy Turnbull tweeted: “#Mediadiversity is essential, now more than ever. So many smaller and regional newspapers are under major economic threat. They need AAP’s independent news content.”
The independent Tasmanian senator, Jacqui Lambie, called on the government to help fund AAP from its newly announced $50m fund to assist regional media.
“Losing AAP means losing irreplaceable access to independent, nonpartisan breaking news, from Burke to Brisbane to Burnie,” she said.
“If you listen to the news on the radio, or read it in regional print media, or watch it in regional markets on TV, you’re going to lose out. It’s not just journalists, it’s publishers and consumers too.
“AAP first applied for some of these funds months ago and they’ve still heard nothing. What the hell is the government doing? What’s it waiting for?”