Media Mergers

 

The somewhat lukewarm response to the publication of the new Guidelines on Media Mergers this June belies a significant depth of feeling on the issue among the public and media practitioners. The new regulatory regime comes some 40 years after it was first sought by National Union of Journalists (NUJ), and the general response of the union and a large section of the industry is that they are too late – in light of significant consolidation over the last decade; and too little – in that they will not apply retrospectively.

 

While the Irish media is ranked as ‘free’ by international watchdog Freedom House, issues of press freedom and media plurality in this country cannot be taken for granted.

 

Given the importance of the issues, the European Commission – as part of its Digital Agenda for Europe – has established the Media Pluralism Monitor (MPM). The organisation is tasked with applying diagnostic tools to assess levels of media plurality in EU member states on the basis of political, cultural, geographical, structural, and content-related issues. Last November, it initiated an examination of media plurality in nineteen member states, including Ireland. Results are expected at the end of this year and will be received with interest as an unbiased assessment of concentration in the Irish media landscape. Significantly, MPM will not recommend any policy responses and, like our own government’s media merger guidelines, will leave the status quo unchanged.

 

The guidelines, unveiled by Minister for Communications Alex White TD and approved by the Cabinet in June, outline how the Competition and Consumer Protection Act 2014, will apply to media mergers. Prior to the Act, media mergers were examined from the points of view of competition, and likely economic, consequences. The new guidelines make provision for the concept of media plurality – a diversity of views, opinions and ownership structures – and its role in democracy. They ensure that this principle is taken into account in determinations on media mergers and, for that reason, require that advance notifications be made in all cases to both the Competition and Consumer Protection Commission (CCPC) and the Minister for Communications.

There has been a broad welcome for the inclusion of the ‘public value’ test to ensure that proposed mergers do not damage media plurality. There has also been a positive response to the expansion of the definition of media business to include online media, and for the more specific guidance on determining whether or not an entity has a ‘significant interest’ in a media business. The guidelines define a significant interest as sufficient voting, financial or ownership strength

to influence directly or indirectly, to an appreciable extent, the direction of policy of the media business or media businesses with regard in particular to news, current affairs or cultural content.

They say that while a holding or voting strength of between 10% and 19% in a media business may constitute a significant interest, a holding or voting strength of over 20% “will generally constitute a significant interest”.

 

In line with the provisions of the Act, the guidelines outline Phase 1 and Phase 2 examinations of proposed mergers by media organisations. After the initiation examination, the Minister may determine that the merger can proceed. He also has the option to attach certain conditions. At this point, the Minister has a third option of requesting the Broadcasting Authority of Ireland (BAI) to initiate a full Phase 2 examination. During this phase, the BAI will invite submissions from the relevant Oireachtas Committee, from the public, and, possibly, from an ad hoc and temporary advisory panel. It may also request further information for the organisations seeking to merge.

 

At both phases of examination, consideration will be given to the media entities’ ownership and control; market share; governance; editorial ethos; content; sources and finance. The power to make the final determination remains in the hands of the Minister.

 

While former Attorney General Michael McDowell has said he can see no reason why the guidelines cannot be applied retrospectively, Minister White has consistently repeated that they cannot.

 

Speaking at the launch in June of the Institute for Future Media and Journalism (FuJo) at Dublin City University (DCU), Irish Times editor Kevin O’Sullivan agreed with the former AG, but Minister White cited “labyrinthine commercial issues” which he believes make retroactivity impossible.

The NUJ, which first mooted the need for specific media merger guidelines when Tony O’Reilly took ownership of the Sunday Independent, has been sharply critical of “an abject failure of the government to tackle powerful media interests in Ireland”.

 

Seamus Dooley, Irish Secretary of the NUJ said that “the refusal of the government to countenance any retrospective measures to break the stranglehold on media ownership by a few powerful groups and individuals, and the insistence that existing concentration of ownership have no material impact on the guidelines undermines the value of the process undertaken by Minister Alex White”.

 

The journalist’s union, which held round-table discussions in January when the draft guidelines went out to public consultation, also criticised the apparent failure to action most of its recommendations – including its call for an independent Commission on the Future of the Media in Ireland.

 

In a submission on the draft guidelines and subsequent to their finalisation, Irish Times editor Kevin O’Sullivan cited a preference for “a permanent body to monitor issues to do with media plurality”. Speaking at the FuJo launch, Mr O’Sullivan expressed concern about the extended remit of the BAI, saying it was “arguably either expert not independent in the sense that the press council is”.

 

The opening of FuJo also saw the launch of the Reuters Institute Digital News Report 2015 (Ireland). Among several items of interest is the finding that just 46% of Irish people expressed trust in general news. The fact that we rank behind countries like the UK, German and Brazil underlines the importance of strong support for a pluralist and free media. It also suggests a public appetite for reform which extends well beyond the provisions of these long overdue guidelines on media mergers.