Crikey understands the government is very close to allowing SBS to change the way it calculates its allowable minutes per hour of advertising.
Currently SBS is allowed to air advertising for five minutes every hour. Wholly commercial stations are allowed 13 minutes of advertising (not including network promos) per hour in prime time, which is averaged out from 6pm to midnight. In his review of the efficiency of Australia’s two public broadcasters, now-ABC board director Peter Lewis recommended that SBS be allowed to average out its two-hours daily allowable advertising over the whole day. This would allow SBS to load up advertising in times of high viewership, while lowering the number of ads shown in times when there are few viewers. The proposal favoured would cap advertising at 10 minutes per hour, and is unlikely to touch on the number of advertising “blocks” SBS is allowed to air, meaning it could air several shorter advertising breaks, or one or two larger breaks, if it chose to.
Crikey understands the legislation on this has not yet been drafted, and would need to go to the Expenditure Review Committee before it can be approved. But the idea has garnered considerable support from both the SBS board and the federal government. Any decision is likely to be tied to the funding cuts being finalised by the government’s committee, to be released perhaps as early as next month. The SBS charter would need to be changed to allow the ad calculations to be done differently.
SBS will face a choice as to whether to keep the extra funding from these ads or pass the extra revenue back to the government. Ultimately it makes little difference, as the anticipated revenue would be taken out of SBS’s government funding package if it decides to keep it.
A spokesman for Communications Minister Malcolm Turnbull declined to comment on specifics. “The government is continuing to work closely with the national broadcasters and is aware of a range of proposals for efficiency savings,” he said.
The proposal, rumoured for some time, has drawn opposition from both commercial TV operators and staff and viewer groups. Two weeks ago, Fairfax’s Matthew Knott reported that the ad-averaging proposal had infuriated the commercial TV sector. Speaking to Crikey this morning, Free TV CEO Julie Flynn said that if there’s a shortfall in SBS funding, the government shouldn’t look to the private sector to make up that shortfall. “There’s a finite advertising pie. This proposal means there’ll just be more people trying to divide the pie. We don’t think there’s a lot of extra money floating around.”
“Increased advertising is not a substitute for a proper level of funding. Chasing advertising dollars can come at the cost of SBS’ charter obligations.”
In August, community group Save our SBS wrote about the proposed change in August in an editorial on the group’s website. Yesterday, Save our SBS president Steve Aujard said the group was very much opposed to a significant increase in advertising on the network. “We’d see it as yet another nail in the coffin of SBS,” he said. “We don’t believe it’s possible to have many commercials and abide by their charter. The more you enable commercials, the more SBS will face an incentive to tinker with their programming to boost their ratings.”
The comments were echoed by the Community and Public Sector Union, which represents many SBS workers. President Michael Tull said the change would only benefit the government, and not SBS. “Increased advertising is not a substitute for a proper level of funding. Chasing advertising dollars can come at the cost of SBS’ charter obligations.”
Despite concerns from the commercial TV sector, some have questioned how much extra revenue SBS’s current programming choices could squeeze out of its advertising, as on the vast majority of nights it is the fifth-rating network, behind the three commercial broadcasters and the ABC. Its sporting broadcasts, particularly of cycling and soccer, do pull in significant numbers of viewers, so presumably the proposal would most benefit the station’s ability to monetise the high-profile sporting events it airs.
The 2012-13 SBS annual report (the most recent one available) shows in that year SBS made $58 million from advertising and sponsorship. Its total government funding at that point was $222 million. In the May budget, SBS had $8 million taken out of its budget, then referred to as a “down payment on further efficiencies”. More budget cuts are expected in coming weeks.
SBS introduced advertising in 1991, but originally it was only allowed between programs. Advertising within programs, facilitated by ad breaks, is considered more valuable by advertisers, and was introduced to SBS in 2006.
If one accepts Australia faces long-term budgetary difficulties, is there a reason the SBS/ABC categories have to be made immune? Those who see the SBS/ABC Collectives as Sacred Cows [especially since most of these True Believers don’t come from underprivileged sectors of society] can always donate to what they deem a noble cause.
Record their shows, bone the ads then watch.
Back in the early 1990’s when Brian Johns introduced paid advertising to SBS, we (the then staff) were told that the government would never take away money from the allocated budget and all the advertising revenue would go to SBS productions.
Well finally what was feared then is coming true. What a disgrace that the SBS board and management would accept this when they have a gun pointed to their head.
Private funding for the public broadcasters defeats the purpose of having public broadcasters, namely a broadcaster that delivers programming in and for the public interest not influenced by private and corporate considerations. The mainstream media has consistently shown scant regard for the public interest in most of its reporting, preferring click bait, advertorials, regurgitation of public relations statements or outright political bias to any kind of genuine investigative journalism or relatively balanced policy review and debate, let alone speaking truth to power. A public broadcaster wouldn’t be as necessary if there were enough private media companies who even tried to rationally address some of the major issues of the day without an entrenched political and commercial bias or at least were accountable through some form of actual regualtion in regards to accuracy. We don’t however, so a public broadcaster is necessary for the time being at least to ensure that enough unfiltered information gets through to the people so our democracy can limp on slightly more robustly. The advent of more diversity in the online media space (Crikey for example) does to help give more than just the News Corpse/Unfairfax world view but until online news sources can reach a more consistent standard of credibility and accountability, a publicly funded public broadcaster is a vital public service.
I’m not saying ABC and SBS are the pinnacle of accurate reporting, just that they are more credible and accountable than the rest of the msm.