BROADCASTING LEGISLATION AMENDMENT (DIGITAL TELEVISION) BILL 2006 Explanatory Memorandum

Commonwealth of Australia Explanatory Memoranda

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BROADCASTING LEGISLATION AMENDMENT (DIGITAL TELEVISION) BILL 2006

2004-2005-2006 THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA HOUSE OF REPRESENTATIVES BROADCASTING LEGISLATION AMENDMENT (DIGITAL TELEVISION) BILL 2006 REVISED EXPLANATORY MEMORANDUM (Circulated by authority of the Minister for Communications, Information Technology and the Arts, Senator the Hon. Helen Coonan) THIS MEMORANDUM TAKES ACCOUNT OF AMENDMENTS MADE BY THE SENATE TO THE BILL AS INTRODUCED

BROADCASTING LEGISLATION AMENDMENT (DIGITAL TELEVISION) BILL 2006 OUTLINE The Broadcasting Legislation Amendment (Digital Television) Bill 2006 (the Bill) contains provisions to implement the Government's decision to reform several aspects of the digital television and commercial television broadcasting regime. The Bill also provides a framework for the allocation of two nationwide channels in accordance with the Government's decision to make these channels available for new digital services. A series of statutory reviews of aspects of the digital television regulatory framework was conducted in 2004 and 2005. These reviews examined issues including: � the restrictions on multi-channelling and terrestrial subscription services; � matters relating to the end of the moratorium on the issuing of new commercial television licences, which concludes on 31 December 2006; � the operation of legislation related to markets with only one or two commercial television broadcasters; and � high definition digital television (HDTV) requirements. In commencing these reviews, the Government indicated that it intended to amend the current legislative arrangements which give the Australian Communications and Media Authority (the ACMA) the power to allocate new commercial television licences, so that the power is vested in the Government of the day. This was subsequently confirmed in an election commitment. Following these reviews and in consideration of broader changes in the media sector, the Government issued a discussion paper on a range of media policy reform options in March 2006. The Bill is intended to implement the Government's policies in response to the digital television reviews, and to submissions to the discussion paper, and will make a number of amendments designed to provide additional digital services to consumers and help drive digital take-up. The Bill will amend the Broadcasting Services Act 1992 (BSA) and the Radiocommunications Act 1992 (RA) in the following ways. Digital television services provided by existing broadcasters The Bill will make several changes to the regulatory regime for digital television. It will:

2 � remove the current genre restrictions on multi-channelling by national broadcasters to permit national broadcasters to provide a broader range of digital services; � remove, from 1 January 2007, the requirement that the high definition television (HDTV) version of the digital television service must be a simulcast of their standard definition television (SDTV) and/or analogue service (in effect allowing one HDTV multi-channel); � allow, from 1 January 2009, commercial free-to-air (FTA) television broadcasters to provide a single multi-channel in SDTV digital mode in addition to their SDTV simulcast of the analogue service; � remove the regulatory restrictions on the number of multi-channels that may be provided by FTA commercial television broadcasting services at the end of the simulcast period; � remove the existing HDTV quota at the end of the simulcast period; � ensure that events or parts of events on the anti-siphoning list cannot be shown on a SDTV or HDTV multi-channel without first being shown, or being shown simultaneously, on the main (or simulcast) service; and � provide that the usual viewer protections will apply in relation to the regulation of content on multi-channels, however other content obligations such as Australian content standards will not apply initially so as to assist with the development of these channels. There will be a review of the regulation of multi-channels before analogue switchover. Anti-siphoning scheme The Bill will make a number of changes to the anti-siphoning scheme to: � ensure that the acquisition of rights to an event on the anti-siphoning list by a commercial television service operating outside the broadcasting services bands of spectrum (BSB) does not satisfy the requirements for a commercial or national broadcaster acquiring the rights for the purposes of the anti-siphoning scheme; and � provide for a review of the anti-siphoning scheme prior to 31 December 2009. Commercial television licensing The Bill will make a number of changes to the licensing arrangements for commercial television to: � modify the power to allocate new commercial television licences in the BSB such that the ACMA cannot exercise this power unless a decision has been taken by the Minister for Communications, Information Technology and the Arts (the Minister) that such a licence should be allocated, with the Minister's decision being informed by a review;

3 � provide a power to the Minister to veto an application made to the ACMA for a new commercial television broadcasting licence outside the BSB (under section 40 of the BSA) on the basis that the allocation of the licence would be likely to be contrary to the public interest; � provide that television licences allocated under section 40 of the BSA must operate in digital mode only; and � provide that certain standard licence conditions and program standards for commercial television broadcasting licences do not apply to commercial television services operating outside the BSB, and that certain tailored conditions and standards apply to these licences. Allocation of channels for new digital services The Bill will provide for the allocation of two types of datacasting transmitter licences, a channel A datacasting transmitter licence and a channel B datacasting transmitter licence. Both channel A and channel B licensees will be required to operate in digital mode. In relation to the channel A licences, the Bill will provide that: � Licensees may only provide datacasting, narrowcasting and community broadcasting to domestic digital television receivers; � Commercial television broadcasting licensees and national broadcasters may not control the datacasting transmitter licences; � The price-based allocation system for allocation of channel A licences designed by the Australian Communications and Media Authority (ACMA) must include preconditions for participation in the allocation and the Minister may direct the ACMA in regard to these pre-conditions; and � The ACMA may impose licence conditions, including in relation to rollout obligations on channel A licences, with the Minister to have the power to direct the ACMA about imposition of such conditions. In relation to the channel B licences, the Bill will provide that: � Licensees may provide datacasting services under a BSA datacasting licence, another licence allocated by ACMA under the BSA authorising provision of that service, or a service provided in accordance with a class licence under the BSA. However, licensees cannot provide commercial broadcasting services, subscription television services to domestic digital television receivers, services provided by commercial television broadcasting licenses or national broadcasters to domestic digital television receivers, retransmission of an existing commercial television broadcasting or national broadcasting service to domestic digital television receivers;

4 � Commercial television broadcasting licensees and national broadcasters cannot control the datacasting transmitter licence if it is used to provide services to domestic digital television receivers; and � Licensees must commence services within 18 months or such longer period allowed by the ACMA. Access regime for channel B This Bill also establishes an access regime which requires persons wishing to participate in the allocation process for a channel B datacasting transmitter licence to make an access undertaking, and for the ACCC to accept or reject that undertaking. � The access undertaking will provide for access to services that enable or facilitate the transmission of content services by content service providers. � The ACCC may develop criteria relating to its decision to accept or reject an access undertaking or variation of an access undertaking. The criteria will be a legislative instrument. � A person will not be not eligible to apply for a channel B datacasting transmitter licence unless they have submitted an access undertaking, and the ACCC has accepted it. � An accepted undertaking will become binding on a person who acquires a channel B datacasting transmitter licence. � Adherence to the terms of an undertaking will be a condition of the channel B datacasting transmitter licence. � If a the ACCC or a person affected by the undertaking considers that a person may have breached an undertaking, the ACCC or the affected person may apply to the Federal Court for an order to comply with the undertaking, or for compensation for damages. � The undertaking remains in force for the duration of the licence and is transferred if the licence is transferred. However, undertakings may be varied with the agreement of the ACCC. Codes and standards The Bill will also establish a range of new codes- and standards-making powers for ACMA. It will: � Provide the ACMA with the power to determine, through legal instrument, technical standards relating to the transmission of digital broadcasting services in the broadcasting services bands of spectrum and datacasting services and receivers for use in reception of such services; � Repeal a range of specific standards-making powers; and

5 � Provide the ACMA with the power to register voluntary industry codes, and require industry to develop and register with the ACMA codes of practice dealing with a range of digital television and datacasting issues, with a power to determine standards where such codes are not developed or not developed to the satisfaction of the ACMA. FINANCIAL IMPACT STATEMENT The Bill is expected to have no significant impact on Commonwealth expenditure. The allocation of datacasting transmitter licences is likely to result in receipt of revenue from price-based allocation of these licences. This revenue may be reduced as a result of the imposition of an access regime. However, at this stage it is not possible to predict with any accuracy the quantum of revenue likely to be received, nor the likely revenue reduction from the access obligations.

6 REGULATION IMPACT STATEMENT PROBLEM AND ISSUE IDENTIFICATION Background The Television Broadcasting Services (Digital Conversion) Act 1998 and Broadcasting Services Amendment (Digital Television and Datacasting) Act 2000 amended the Broadcasting Services Act 1992 (BSA) to introduce a managed process for the introduction of digital television services in Australia. These settings were envisaged as transitional arrangements to provide industry with a period of regulatory certainty in order to make the significant investments required in digital infrastructure and to encourage consumers to switch over to digital and minimise risks of disruption to the services that consumers are familiar with and enjoy. Regulatory requirements such as the simulcast requirement, the restriction on multichannelling and the high definition television (HDTV) quota were intrinsic to this approach. They ensure that during the transition from analogue to digital, viewers of analogue and digital free-to-air (FTA) television have access to substantially the same television programming. However, since the transitional arrangements for digital broadcasting were introduced, digital television infrastructure has been widely deployed, and the subscription television sector has developed significantly and is now substantially converted to digital. In addition, overseas developments indicate that a greater number of channels has been a driver of digital take-up. This has particularly been the case in the United Kingdom (UK) where there is now strong competition between channel providers for access to the FTA digital terrestrial platform. In light of these developments, there is a need to consider the appropriateness of existing restrictions on multichannelling and the further introduction of multichannelling as part of the transitional arrangements for complete digital television broadcasting. There is also a need to consider whether the requirements relating to the provision of HDTV should be retained because the broadcasting spectrum that is available for digital television limits the extent to which multichannel and HDTV services can be provided simultaneously. Multichannelling Commercial television broadcasters Commercial FTA broadcasters are not permitted to provide digital multichannels. The prohibition on multichannelling was intended to provide the developing subscription TV sector with some protection from a potential source of competition in its early years. At the time the digital television regime was implemented in Australia, it was considered that HDTV would be a key part of the future of digital television in Australia and that regulation of HDTV was important to provide certainty for consumers and industry.

7 National Broadcasters The national broadcasters (the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service (SBS)) are permitted to provide multichannels, but are subject to legislative restrictions which limit the genres of programming they are permitted to broadcast. For example, national broadcasters are allowed to provide educational, science, religious, health programs and children's programs on new digital channels, but not programs such as national news broadcasts, drama, movies and most sport broadcasts. Both the national broadcasters currently provide multichannels subject to these restrictions. Evidence from overseas markets suggests that public broadcasters can play a significant role in driving digital television take-up by providing attractive new digital content. For example, the BBC has played a significant role in the UK as a driving force in the establishment of the Freeview platform and by adopting and demonstrating the innovative programming enabled by digital television such as interactive programming. Regulation of content on multichannels The consideration of new multichannels necessarily involves considering the regulation of the services that could be provided on these channels. The current simulcast rules, together with the restrictions on multichannelling, have meant that the content-related rules applying to the analogue channel automatically carry across to the digital channel. This includes requirements relating to the classification of programs, protection of consumers, captioning requirements and children's and Australian content requirements. It is apposite to consider whether the content rules that apply to analogue channels are appropriate for new multichannels, which are likely to initially service a smaller audience. While the potential influence of multichannels may be small, some regulation of content will still be necessary, particularly to protect consumers and maintain the objectives of the anti-siphoning regime. While digital take-up is still relatively low, the migration of events on the anti- siphoning list to multichannels would be inconsistent with the objective of the anti- siphoning scheme, which is to provide the widest access for viewers to listed events. It would also have an adverse impact on the subscription television industry's capacity to provide sports programming. HDTV requirements The further introduction of multichannelling also raises the issue of the HDTV quota because the broadcasting spectrum that is available for digital television limits the extent to which multichannel and HDTV services can be provided simultaneously. Commercial and national FTA broadcasters in non-remote areas must provide an HDTV version and a standard definition television (SDTV) version of their analogue television service and transmit at least 1040 hours of HDTV programming each year. The HDTV programs must be a simulcast of the SDTV version. These requirements

8 were introduced as a means of ensuring that a minimum level of HDTV programming would be available during the early years of digital television. However, an indefinite need for HDTV quotas is not envisaged. Quotas were envisaged as a transitional arrangement to provide market certainty. However, in the longer term the market will decide whether HDTV is a dominant digital service, in which case quotas will be unnecessary to ensure its provision, or a limited niche service. Consistent with the objective of progressing the implementation of multichannelling, the requirement to provide an HDTV version of an SDTV service could be relaxed to enable broadcasters to provide different programming on each service. The content issues mentioned above are also relevant to any HDTV multichannel. New commercial television licences The current legislated moratorium on the allocation of new FTA commercial television licences expires on 31 December 2006. In its 2004 Election campaign1, the Government committed to legislating so that the Government has a decision-making role in the allocation of these licences, rather than the Australian Communications and Media Authority (ACMA). There is therefore a need to ensure this change is implemented prior to the end of the moratorium. New commercial television licences - section 40 licences The moratorium on new commercial television licences includes new commercial FTA television services delivered over platforms other than the broadcasting services bands (BSB), such as broadband platforms. Licences for these services are currently provided for under section 40 of the BSA. The end of the legislated moratorium on new commercial television licences means that section 40 licences may be issued for these services from 1 January 2007. There is therefore a need to implement the Government's commitment regarding its role in the allocation of commercial FTA licences in relation to section 40 licences to ensure a consistent, technologically neutral approach to the allocation of licences for services in the BSB, and to define in broad terms the circumstances in which the Government may prevent the allocation of such licences. 1 Liberal Party of Australia, 21st Century Broadcasting, 2004

9 LEGISLATIVE BACKGROUND Multichannelling The BSA limits the uses to which FTA television broadcasters can put the spectrum allocated to them for digital transmissions. Specifically, during the simulcast period commercial television broadcasters must not broadcast a SDTV digital program for an area unless the program is simultaneously broadcast in analogue mode in that area (paragraph 7(1)(m) of Schedule 2 to the BSA). The effect of this is that broadcasters are not permitted to provide additional digital channels (multichannels) over and above the digital version of their analogue channel, or other non-simulcast programming. National broadcasters can provide `multichannelled national television broadcasting services', which are defined in clause 5A of Schedule 4 to the BSA and are restricted to a specified range of programs such as educational programs, regional news and current affairs, science and arts programs, children's programs and occasional dramas. There are some exceptions to the above provisions (subclauses 6(8) and 19(7B) of Schedule 4): � minor differences in programming and differences in advertising on the SDTV and analogue version are permitted where approved by ACMA. � broadcasters are permitted to provide electronic program guides, which are not part of analogue services. � digital program enhancements are permitted if they are closely and directly linked to the program. � broadcasters can use multichannels to transmit a live event designated by ACMA which has run over schedule and would otherwise clash with a scheduled news program. Commercial television broadcasting licensees and national broadcasters are not permitted to use their digital spectrum for the provision of commercial radio, subscription broadcasting or subscription or open narrowcasting services (paragraph 7(1)(p) of Schedule 2 and clause 36 of Schedule 4). From 1 July 2003 or, if later, two years after digital broadcasts were required to commence in their areas, broadcasters are required to transmit a quota of HDTV programming which must also be a simulcast of their analogue/SDTV service. Exemptions are allowed for demonstration programs and certain advertising material. Broadcasters are permitted to provide licensed datacasting services, and the national broadcasters are permitted to provide national radio broadcasting services, on their digital spectrum. In some under-served markets - those with fewer than three commercial services - broadcasters are permitted in certain circumstances to provide a third, digital-only service, which may be multichannelled with an existing service.

10 The above regulatory requirements relate to non-remote broadcasting areas and this review focused on requirements for non-remote areas. The arrangements for remote area broadcasters are yet to be finalised. HDTV requirements Clause 37E of Schedule 4 of the BSA provides that regulations must determine standards which require that an HDTV version of a non-remote commercial television service must be the same as both the analogue and SDTV version of the service, and require transmission of 1040 hours of HDTV programming per year. Clause 37F provides identical provisions for national broadcasters in non-remote areas. Under section 38A of the BSA, a commercial television broadcasting licensee in a licence area in which they are the sole licensee, can apply to ACMA for an additional licence. Where such a licence is issued, the licensee can elect that the parent and additional licence be transmitted in digital mode using one 7Mhz channel (clause 6(5A), 6(5AA) and 6(5B) of Schedule 4 of the BSA). In such a case, the licensee is not required to comply with HDTV obligations that may otherwise apply in that licence area (clause 37E(4) of Schedule 4). Under section 38B of the BSA, in regional areas where there are only two commercial television broadcasting licences, the existing (parent) licensees can opt to provide an additional service either individually or jointly. Where the third service is provided by one parent licensee, that parent licensee can elect to provide the parent service and the third service on one 7MHz channel, with exemption from HDTV obligations. In regional licence areas, where the third service is provided jointly by both parent licensees, separate 7MHz channels are allocated for each service and HDTV obligations apply. In remote areas, this joint licence can be provided along with both parent licences on a single multiplex with exemption from HDTV quota arrangements. Anti-siphoning list events Section 115 of the BSA provides that the Minister may protect the free availability of certain types of programs by specifying an event, or events of a kind, which should be televised free to the general public in a notice in the Gazette. This notice is the anti- siphoning list. The aim of the anti-siphoning list is to prevent the events on the list from being siphoned off by subscription television providers to the detriment of FTA viewers. Accordingly, subscription television broadcasters are prohibited from acquiring the rights to broadcast an event on the anti-siphoning list until those rights have been acquired by a FTA broadcaster or the event is delisted. New commercial television licences The BSA provides for a process by which new commercial television broadcasting licences can be allocated. ACMA is charged with the responsibility of planning for, and allocating, broadcasting licences. This process involves ACMA conducting its statutory planning processes and designating a licence area (or areas) before

11 allocating a new commercial television broadcasting licence in the broadcasting services bands of spectrum. Section 28 of the BSA prohibits ACMA from allocating any new commercial television broadcasting licences in any licence area before 31 December 2006. Section 28A provides for exemptions for licences issued under provisions (sections 38A and 38B) designed to allow additional services to be provided by existing licensees in underserved markets, which are markets with 1 or 2 licensees. Subsection 40(1) of the BSA enables ACMA, following the end of the moratorium on 31 December 2006, to allocate a commercial television broadcasting licence that is not a BSB licence, upon application in writing and subject to an application fee. In contrast to licences allocated in the BSB, section 40 licences confer no rights of carriage. Licence holders must make their own arrangements about obtaining a means of delivering the service and must commence the service within 12 months of being allocated the licence. ACMA is responsible for determining a licence area for such a licence. Content codes and standards Program content Section 123 of the BSA requires codes of practice to be developed by industry groups representing commercial broadcasters in consultation with ACMA. The Commercial Television Industry Code of Practice was registered by ACMA in 2004 and covers program, commercials, and program promotion classification, advertising time on television, accuracy, fairness and privacy in news and current affairs, disclosure of commercial arrangements in factual programming, loudness of advertisements, and complaints handling procedures. The Commercial Television Code operates alongside ACMA standards which regulate programs for children and the Australian content of programs and advertisements. The ABC and SBS develop codes of practice under their own legislation but must notify ACMA of these codes. Children's content Subsection 122(1) of the BSA requires ACMA to determine children's television standards. Broadcasters must provide a minimum of 390 hours of C classified material and P material in each year. A certain amount of this programming must be broadcast in certain timeslots each day. Broadcasters must also provide a certain amount of Australian children's drama programming under this standard, and such programming must also meet the Australian content standard, which includes sub quotas for children's content. Australian content Subsection 122(1) of the BSA also requires ACMA to determine standards for the provision of Australian content on commercial television broadcasting services. The Australian Content Standard 2005 requires all commercial FTA television licensees to broadcast an annual minimum transmission quota of 55 per cent Australian

12 programming between 6am and midnight. In addition there are specific minimum annual sub-quotas for Australian (adult) drama, documentary and children's programs. The standard for Australian Content in Advertising requires at least 80 per cent of advertising time broadcast each year by commercial FTA television licensees, between the hours of 6 am and midnight, to be used for Australian produced advertisements. The Australian United States Free Trade Agreement (AUSFTA) places significant restrictions on the application of Australian content rules to new services and channels. In relation to multichannels, the AUSFTA states that the 55% Australian content quota may be imposed on no more than two channels, or 20% of the total number of channels (whichever is greater, including the main channel), made available by an individual broadcaster. Sub-quotas may be applied within the 55% quota in a manner consistent with existing standards. There are also AUSFTA restrictions relating to Australian advertising quotas (they can only be applied to three channels including the main channel per broadcaster). Captions The Broadcasting Services (Digital Television Standards) Regulations 2000 (the Regulations) require that broadcasters caption all prime time and news and current affairs programming. The Regulations are made pursuant to clause 38 of Schedule 4 of the BSA. OBJECTIVES Two key objectives have been identified to address the issues stated above. The first objective is to facilitate the transition, over time, from a single analogue television broadcasting service to arrangements for broadcasting in digital mode where broadcasters have a flexible range of options in terms of providing new channels and other services, while at the same time ensuring the continued provision of high quality broadcasting services. This is consistent with the regulatory objective set out in paragraph 3(1)(n) of the BSA, which provides that the BSA is intended to ensure the maintenance and, where possible, the development of diversity, including public, community and indigenous broadcasting, in the Australian broadcasting system in the transition to digital broadcasting. The second objective is to implement the Government's election commitment to take a decision-making role in commercial television licensing. OPTIONS Multichannelling M1. No change: - remove the current restrictions on full multichannelling by FTA commercial television broadcasting services at the end of the simulcast period;

13 - remove the current restrictions on multichannelling by national broadcasters at the end of the simulcast period. M2. Total change: - remove all restrictions on multichannelling immediately. M3. Progressive change: - remove the current restrictions on full multichannelling by FTA commercial television broadcasting services at the end of the simulcast period; - allow, from 1 January 2009, commercial FTA television broadcasters to provide a single multichannel in SDTV digital mode; - remove the current restrictions on multichannelling by national broadcasters. HDTV requirements H1. No change: - maintain all HDTV requirements including after the end of the simulcast period. H2. Total change: - remove all HDTV quota requirements immediately. H3. Progressive change: - remove, from 1 January 2007, the requirement that the HDTV version of the digital television service must be a simulcast; - remove the existing HDTV quota at the end of the simulcast period. Anti-siphoning list events on multichannels A1. No change: - allow an event on the anti-siphoning list to be shown on potential new multichannels without first being shown, or simultaneously shown, on the simulcast service; - allow the acquisition of rights to an event on the anti-siphoning list by a commercial television service operating outside the BSB (s40 broadcasters) to satisfy the requirements for a commercial or national broadcaster acquiring the rights for the purposes of the anti-siphoning scheme A2. Total change: - remove the anti-siphoning regime immediately.

14 A3. Progressive change: - ensure that events on the anti-siphoning list cannot be shown on a SDTV or HDTV multichannel without first being shown, or simultaneously shown, on the simulcast service; - ensure that the acquisition of rights to an event on the anti-siphoning list by a commercial television service operating outside the BSB does not satisfy the requirements for a commercial or national broadcaster acquiring the rights for the purposes of the anti-siphoning scheme; - provide for a review of the anti-siphoning scheme prior to 31 December 2009. New commercial television licences L1. Do not implement Government commitment: - ACMA will be able, from 31 December 2006, to allocate commercial television broadcasting licences for services provided via the BSB, having completed its statutory planning processes and designated licence areas; - ACMA will be able, from 31 December 2006, to allocate commercial television broadcasting licences for services that are not provided via the BSB upon receiving a written application and an application fee. L2. Implement Government commitment: - modify the power to allocate new commercial television licences in the BSB such that the ACMA cannot exercise this power unless a decision has been taken by the Minister that such a licence should be allocated; - provide a power to the Minister to veto an application made to ACMA for a new commercial television broadcasting licence allocated under section 40 of the BSA for services provided outside of the BSB on the basis that the allocation of the licence would be contrary to the public interest. Content conditions and standards C1. No change: - the codes and standards regulating content on analogue FTA television services will apply to new multichannels and services provided under section 40 licences. C2. Total change: - provide that the codes and standards regulating content on analogue FTA television services will not apply to new multichannels and services provided under section 40 licences. C3. Moderate change:

15 - provide that certain standard licence conditions and program standards for commercial television broadcasting licences do not apply to commercial television services operating outside the BSB, and that certain tailored conditions and standards apply to these licences. Impact analysis Multichannelling M1 M2 M3 Stakeholders No ability to Ability to provide Ability to gradually FTA Broadcasters provide new new services. introduce new services until full There are differing services, moving switchover to views amongst ultimately to full digital. industry players on multichannelling, Broadcasters the impact of this but in a way which limited to simulcast minimises the on their viability. of analogue impact. services. National Continue to have Ability to provide Ability to provide ability to provide increased range of increased range of broadcasters limited services. services. multichannels, but restrictions on programs will remain. Fewer opportunities to provide new innovative programs. Subscription No change to Potential for Ability to gradually greater competition adjust to television operators current impacts. for content and competition over viewers from FTA time. services. No new content Depending on FTA Gradual Consumers until switchover. reaction, significant introduction of new

16 Fewer incentives to new content. content, subject to Greater incentive to decisions by FTA convert to digital. purchase digital broadcasters to provide receivers. multichannels. Little incentive for Depending on FTA Gradual increase in Suppliers new content or reaction, greater opportunities to opportunity for supply, depending equipment supply. supply of content on FTA reaction. and equipment. No change to Depending on FTA Gradual increase in Advertisers current impacts. reaction, increased opportunities to Current trends of opportunities for supply advertising. growth in other advertisers due to markets eg Internet more services, relative to possible reduced television could cost due to greater availability of continue. advertising slots. Options M1 - Retaining the current restrictions on full multichannelling by commercial FTA television broadcasters and the genre restrictions on multichannels provided by national broadcasters until the end of the simulcast period would not enable them to provide any new content for several years. At the end of the simulcast period, commercial broadcasters could use their commercial broadcasting licences and radiocommunications transmitter licences to provide the same range of service types as national broadcasters. Consumers would not benefit from significant new content. The relative paucity of slots for advertising would retain prices for advertising space at current levels, with no opportunity for advertisers to benefit from increased capacity for advertising. Option M2 - This option will allow broadcasters to immediately supply new multichannels if they considered it commercially viable. The impact on various groups would depend on what each broadcaster did in response to the relaxation of the rules. It would also depend on what other restrictions applied at the time eg. if HDTV quota obligations remained, broadcasters' ability to multichannel would be constrained and influenced by their choices about how they used their 7MHz of spectrum. There is contention about whether this would lead to reduced quality of service, by impacting on the ability of broadcasters to fund the purchase of quality programming for all channels.

17 Options M3 - Allowing, from 1 January 2009, commercial FTA television broadcasters to provide a single multichannel in SDTV digital mode, in addition to the SDTV simulcast of the analogue service, will add to the diversity of services in digital format, thereby adding to the attractiveness of digital television and contributing to digital take-up. This coupled with immediate removal of restrictions on national broadcasters' multichannelling would increase content for consumers and allow a gradual adjustment by industry to the new environment. Economic impact of multichannelling In 2004 the Department of Communications, Information Technology and the Arts commissioned a study into the economic impacts of multichannelling. The full study can be found at www.dcita.gov.au > broadcasting > policy reviews > digital broadcasting policy reviews > review of restrictions on multichannelling and other services . Broadly, the study concluded that if broadcasters were to be free to choose to offer multichannels and/or subscription and radio services: � Average revenue per channel would be reduced but this will not necessarily reduce industry profitability and the industry would be likely to take steps to manage any profit risks. � Even if industry profitability is reduced it is unlikely that the industry's viability will be threatened. � Claims about reduced quality in a multichannel environment are largely unfounded. � Subscription broadcasters would face increased competition for program content and subscribers, more so if terrestrial broadcasters were allowed to offer subscription multichannels. This competition would be reduced by other elements of the regulatory regime. � Commercial radio broadcasters may face increased competition for some advertisers and some listeners. On the relationship between multichannelling and the uptake of digital television the report concluded that: � The uptake of digital television is shaped by a range of influences. � Digital uptake has been modest but is in line with most other new technologies. � Earlier forecasts for digital television uptake were overly optimistic. � Multichannelling would be likely to stimulate demand for digital television but alone will not be a sufficient incentive for many households. � The nature and quality of any free multichannelling content would be a critical factor in consumer demand for digital television. This would be separately determined by each broadcaster in response to consumer preferences.

� Overseas experience suggests uptake, particularly where � Other approaches such as broadcasting may have a significant HDTV requirements H1 Stakeholders Limited capacity FTA Broadcasters for new services. Would require continuing HDTV after simulcast and therefore limit ability to choose to multichannel. Subscription No change to current impacts. television operators Subscription television operators likely at some stage to provide HDTV channels. No new content Consumers until switchover. But certainty about availability of HDTV until switchover. 18 that subscription channels can stimulate digital it stimulates inter-platform competition. a clear commitment to switching off analogue influence on the uptake of digital television. H2 H3 Increased Ability to gradually flexibility to introduce new choose whether to services. supply HDTV - impact would depend on whether multichannelling is permitted. Little direct impact Ability to gradually unless combined adjust to with allowing full competition from multichannelling HDTV (which would have multichannel. potential for Restricting significant multichannel to competition for HDTV will content and minimise initial viewers, depending impact on on broadcaster subscription television (as choices). HDTV audience relatively small). Depending on FTA Gradual reaction, could introduction of new leave HDTV HDTV content. receiver owners May also have a without HDTV greater incentive to purchase HDTV content. receivers.

19 Little incentive for Depending on FTA Gradual increase in Suppliers new content or reaction, greater opportunities to equipment supply, opportunity for supply but certainty about supply of content and equipment. HDTV. Uncertainty about whether to import HDTV programs and equipment. No change to No significant Gradual increase in Advertisers current impacts. change to current opportunities to Current trends of impacts. supply advertising. growth in other markets eg Internet relative to television could continue. Option H1 - This option would retain the HDTV obligations to simulcast the SDTV service until the end of simulcast, and retain the obligation to supply a certain amount of HDTV thereafter. This would have the effect of limiting any choice by broadcasters about introducing multichannelling after the end of the simulcast period because with only 7 MHz of spectrum there is insufficient capacity for HDTV and a significant number of multichannels. Option H2 - This option would immediately remove the obligation to supply HDTV and may mean that some or all broadcasters cease to supply HDTV, leaving the increasing number of consumers purchasing HDTV equipment without the benefits of HDTV. Option H3 - The removal of the HDTV quota from switchover will ensure that prior to switchover, industry and consumers continue to have certainty about the availability of HDTV. However, it will also ensure that after switchover, broadcasters will have greater choice in the types of services they can provide, particularly combined with the end of restrictions on multichannelling following switchover. Removing, from 1 January 2007, the requirement that the HDTV version of the digital television service must be a simulcast of the SDTV service will effectively enable commercial broadcasters to provide a single HDTV multichannel, with opportunities for new and different content of benefit to viewers with HDTV receivers. Anti-siphoning list events on multichannels The analysis below assumes some multichannelling is allowed. A1 A2 A3

20 Stakeholders Could allow Would create Would retain the FTA Broadcasters broadcasters to greater competition current balance of provide sports on for sporting rights the anti-siphoning the anti-siphoning and reduce arrangements, list on new attractiveness of pending review. channels, as well as broadcasters' analogue simulcast. services. May increase the attractiveness of digital generally and services of the broadcasters concerned. Subscription Would significantly Would significantly Would retain the reduce subscription enhance current balance of television operators television's ability subscription the anti-siphoning to negotiate for television's ability arrangements, to negotiate for sports rights. pending review. premium sports . rights. Could reduce Could reduce Would retain Consumers access to sporting access to sporting current situation events to majority events to majority pending review. of viewers (until of viewers (not digital take-up subscribing to subscription increased). television services).

21 May increase May decrease Would retain Suppliers sporting program demand for some current situation demand and reduce programs and pending review. other program increase demand demands. for others. Depending on broadcaster options adopted, could drive take up of digital. . Increased May reduce Would retain Advertisers opportunities if demand if current situation popular sports significant shift of pending review. events shifted to sporting events to subscription multichannels. television. Option A1 would allow FTA broadcasters to show a greater range of sports content on their multichannels if they had the rights to this content and strengthen their position in rights negotiations. For example, a broadcaster could use secondary channels to provide multiple events of the same tournament. Broadcasters could use sport as an attractor for viewers to multichannels and away from competitors' services. On the other hand, allowing subscription television providers to acquire rights where only section 40 broadcasters had acquired the rights would not ensure a wide audience had access to this content. Section 40 broadcasters are unlikely to have a wide audience, at least initially, as new types of equipment are likely to be needed to receive their services. Option A2 would enhance the access to sports programs of subscription television operators, but would not guarantee access to important content to a wide audience through FTA broadcasters operating in the BSB. Option A3 would prevent the screening of any part (or parts) of an event on the anti- siphoning list on the multichannel services provided by commercial or national broadcasters unless that part (or parts) of the event has previously been shown or is simultaneously shown on the simulcast service. This would retain the status quo, pending a review of the scheme in 2009. It would mean that broadcasters may not be able to take advantage of rights they hold or negotiate to increase sports coverage, and it would also not provide a competitive advantage to FTA broadcasters over subscription television operators in relation to acquisition of sports content. Option A3 would also ensure that the acquisition of rights to an event on the anti- siphoning list by a commercial television broadcaster licensed to operate outside the

22 BSB under section 40 of the BSA cannot satisfy the requirement that before a subscription television licensee can acquire broadcast rights to the event, a national or commercial FTA broadcaster must have acquired the rights. This will continue to ensure that sporting events on the anti-siphoning list are available to the widest audience. New commercial television licences L1 L2 Stakeholders Potential new competitors Longer term potential for FTA Broadcasters new entrants in BSB and affecting viability/profits. earlier introduction of services outside the BSB. Subscription May allow subscription May allow subscription television operators to television operators to television operators provide commercial provide commercial services, services through section 40 but only outside the BSB, provided not assessed as not licences. being in the pubic interest. Potential new content, but Potential new content under Consumers may impact negatively on section 40 licences but may quality of programs require purchase of different provided by existing receivers. players due to revenue No new commercial impact. networks using broadcasting spectrum unless the Government chooses to allocate licences Potential new market for Potential new market for Suppliers content. content. Potential growth in take up New services outside broadcasting spectrum would of receivers. provide new opportunities for infrastructure providers (eg satellite operators or

23 telecommunications companies). Potential new market for Potential new smaller market Advertisers advertisers, with for advertisers through significantly increased section 40 licences. advertising slots. May impact on existing broadcasters by pushing down prices paid by advertisers. Option L1 would not implement the Government's election commitment. It would enable ACMA to allocate new commercial television broadcasting licences within the BSB if they considered the legislative criteria were fulfilled and they had undertaken their statutory process to vary licence area plans. ACMA could issues commercial television broadcasting licences for operations outside the BSB over the counter from 2007, and the Government would have no say in their allocation. Consumers and advertisers would benefit from new services. Existing players would suffer significant disruption from a major new source of competition for programs, viewers and advertising revenue. Option L2 would fulfil the Government's election commitment to amend the current legislative arrangements so that the power to allocate new commercial television licences is vested in the Government of the day. Option L2 could provide the Government with a direct role in addressing the policy questions associated with the allocation of a commercial television licence, while ACMA would undertake the technical investigations and planning exercises as well as allocating the licence subject to finalisation of the review report by the Minister. Option L2 would also provide a power to the Minister to veto an application made to ACMA for a section 40 licence for new commercial television broadcasting services provided outside the BSB on the basis that the allocation of the licence would be contrary to the public interest. This would retain the simplified allocation process for section 40 licences, with an application for a non-BSB commercial television broadcasting licence initially made to ACMA. However, if ACMA proposes to allocate a licence in accordance with the application, ACMA would be required to refer the application to the Minister. The Minister would then have the opportunity to consider the impact of the proposed service in terms of the public interest. Compared to Option L1, Option L2 would provide fewer new services for consumers, who would also have to purchase new equipment to receive the services. For example, a new commercial broadcasting service delivered via satellite and licensed under section 40 would require a viewer to purchase appropriate satellite reception equipment.

24 Content codes and standards These options assume immediate or gradual introduction of multichannels, and provision of new section 40 services. C1 C2 C3 Stakeholders Would increase Broadcasters would Would provide FTA Broadcasters content only implement certainty about requirements and factors such as regulation of costs of providing adult content or multichannels. Australian content Would have some multichannels. rules if they costs, depending on considered it the nature of the commercially content requirements desirable. imposed. . Section 40 Would impose Would enable Would restrict significant costs on greater freedom in freedom to some broadcasters broadcasters with a content provision. degree and impose small audience and Broadcasters would gradual some regulation only implement requirements. would be rules if inappropriate (eg. commercially digital conversion sensible. requirements). Would increase Reduced access to Maintained access Consumers access to local and other to content on main Australian and regulated content. channels, retain children's content, Broadcasting protections for and retain content standards consumers. protections against would be set by broadcasters undesirable matter. themselves.

25 Increase market for Reduced market for Maintained market Suppliers Australian content. for Australian Australian content. content. . Option C1 requires commercial television broadcasters within the BSB to not only comply with standards aimed at protecting viewers but also provide the full level of Australian and children's content quota on each of their multichannels. Option C1 would also require commercial broadcasters operating outside the BSB, with initially very low audiences, to comply with standards aimed at protecting viewers and with the full immediate application of content quotas and to comply with some irrelevant obligations, such as those relating to digital conversion and simulcasting. Imposing the maximum possible obligations now may make new multichannels so uneconomic that broadcasters may not provide them. This would be of no benefit to either viewers or the Australian content industry. Given this uncertainty, it is desirable at present to impose minimal requirements on new channels so as to increase the likelihood that these channels will be established. Option C2 would totally remove not only content obligations but viewer protection requirements from multichannels and from new section 40 broadcasting services. Leaving multichannels free of Australian content obligations could mean that new channels may not contain any Australian content. In addition, there would be no specific rules applying to new channels relating to, for example, provision of adult content. Option C3 would see viewer protections maintained on all commercial broadcasting channels, but reduced or delayed content obligations on multichannels and on new commercial television broadcasting licensees. CONSULTATION Statutory reviews A number of provisions in the BSA require the Minister to cause to be conducted a series of reviews by 1 January 2005, 1 July 2005 and 1 January 2006. These reviews were grouped into thematic reviews and conducted during 2004 and 2005 by the Department of Communications, Information Technology and the Arts (the Department). An issues paper seeking public comment was released for each thematic review. The issues dealt with in these reviews are summarised in the table below. Reports of these reviews were tabled in the Parliament in March 2006. Table 1 - Thematic reviews of digital broadcasting policy and legislation Review Issues dealt with � 1 Restrictions on programming provided by FTA broadcasters, including multichannelling;

26 � Whether the prohibition on FTA broadcasters offering other types of services, such as pay TV channels, should be modified. � 2 The end of the moratorium on the allocation of new commercial TV broadcasting licences on 31 December 2006; � The Government's intention to give the government of the day responsibility for making decisions about allocating these licences; � Arrangements for the use of DTLs after 2007. � 3 The efficient allocation of spectrum for digital TV � 4 Under-served markets (1-2 commercial TV broadcasters) � 5 High definition digital TV requirements � 6 Duration of the digital simulcast period House of Representatives Committee Inquiry In addition, some of these issues were commented on in the context of the House Of Representatives Standing Committee on Communications Information Technology and the Arts' (the House of Representatives Committee) inquiry into the uptake of digital television in Australia, reported on in February 2006. Media reform discussion paper In March 2006, the Government released a discussion paper proposing a framework to address issues raised in these reviews, and setting out proposals for reforms in areas such as media ownership (Meeting the Digital Challenge: Reforming Australia's media in the digital age). Over 200 submissions to the consultation process related to this discussion paper were received. A summary of the views expressed in the 200 submissions is provided in below. Summary of stakeholder views The following views were expressed in the context of the reviews which lead to the development of the media reform package. Details of views in the submissions can be found on the Department's website, www.dcita.gov.au. Multichannelling There was some support for allowing the HDTV programming stream to be different to the analogue/SDTV simulcast in order to allow HDTV to develop into a niche market. However, some respondents argued that this would constitute another form of multichannelling and should be considered in that context. There was no clear consensus amongst respondents on whether FTA multichannelling should be allowed.

27 Arguments in favour of multichannelling fell into three categories: � Multichannelling will increase digital uptake, as the digital-only content available on the multichannels will act as an extra incentive for viewers to convert. There is evidence of strong consumer interest in additional content as a factor in taking up digital television. � Multichannelling will increase competition between FTA broadcasters for programming and viewers. This will enhance viewer options and increase the diversity of programming as broadcasters are able to provide more niche programming and services targeted at particular interest groups. Multichannelling will also provide networks with greater scheduling flexibility and will provide opportunities to attract new advertising streams targeted at niche audiences. It will also help broadcasters counter the fragmentation of audiences and the advertising market which is already occurring, being driven by other consumer markets such as subscription television, DVDs and the Internet. � Multichannelling will increase competition between the FTA broadcasters and other media sectors including subscription television, DVDs and the Internet for programming and viewers. This will further help foster innovation in digital broadcasting and the development of digital content. Some support for multichannelling was conditional, for example, upon full application of the Australian and children's content obligations, or captioning requirements. Arguments against multichannelling fell into two categories: � Allowing multichannelling is too risky. Its benefits are unclear and indeterminate. Multichannels will not attract mass audiences and so will generate little additional revenue while at the same time requiring networks to produce and acquire a greater volume of programming. Cost pressures will force broadcasters to air cheap content such as repeats and `B-grade' shows, thus also threatening the quality and diversity of programming. Furthermore, multichannelling will exacerbate audience fragmentation across a greater number of channels and may dilute the emphasis on HDTV in the digital television regulatory regime. � There is the potential for FTA multichannelling to adversely affect subscription television and other communications sectors, such as broadband services, particularly if counter-balancing changes are not made to the regulatory regime, and given the recent investment in digitisation by the subscription television sector. The FTA sector is well established and very profitable and is protected from increased competition by regulatory measures such as the moratorium on new commercial television licences and the anti-siphoning scheme. In contrast, subscription television penetration remains relatively low and the sector claims that it has only recently become profitable. There is also no limit, other than market forces, on the number of competitors in the subscription television industry. While there was some general opposition from a number of parties to FTA multichannelling, very few concerns were raised specifically about national

28 broadcaster multichannelling. In addition to the general support given to multichannelling by all FTA broadcasters, there was some specific support for relaxing the genre restrictions on national broadcasters. Several respondents made comments about the importance of adequate funding for the ABC and SBS, as well as the important role national broadcasters have in technological and content innovation. The national broadcasters argued that at least some relaxation of the genre rules would be beneficial enhancing their ability to provide additional content of interest to their audience in a cost-effective manner. The House of Representatives Committee recommended that program restrictions on multichannelling for national FTA networks be removed as soon as possible but no later than 1 January 2007. The Committee also recommended removal of all restrictions on multichannelling for commercial FTA networks from 1 January 2008. HDTV quotas There was no clear consensus amongst submitters on whether HDTV quotas should be retained. A number of respondents supported maintaining the quota, although views differed on the place of HDTV in the broadcasting environment, with some seeing it as a key driver of digital and others seeing it as a niche service. Supporters of maintaining the quota argued: � The quota is necessary to ensure that HDTV continues to be available to those who have already invested in the technology (including consumers, producers, broadcasters and equipment suppliers). The quota ensures that viewers who choose to buy HDTV equipment have high amounts of HDTV programming available to them. Without the quota, some FTA broadcasters may not provide HDTV programming. � Interest in HDTV and availability of HDTV content is increasing, but in the absence of certainty about future developments, the quota should continue. � Provision of HDTV is an important obligation that is a quid pro quo for use of valuable spectrum. � The existing quota is not onerous, representing only around 12 per cent of total annual broadcast time, which provides broadcasters with plenty of scope for scheduling HDTV programs. � HDTV has a role in promoting the uptake of digital television, but HDTV is not yet a mature market. Lifting the quota could cause the uptake of digital television receivers to slow down, and may result in the full potential of digital television not being reached.

29 � Some respondents considered that the quota would not be needed in the long-term and it was suggested that the quota could be phased out in about 3-5 years or, perhaps, once the analogue network is closed. Arguments against retaining the HDTV quota included: � Broadcasters should be allowed to use the spectrum as they see fit, for instance, to multichannel, and decisions about HD should be made on the basis of commercial realities, not regulation. � The quota distorts the market. The effectiveness, efficiency and cost-benefits of the quota are not clear. Without the quota, some broadcasters would reduce their HD whereas others would maintain or increase the amount of high definition programming. � The HDTV quota acts as a barrier to community television getting access to digital spectrum because HDTV consumes bandwidth that could otherwise be used for multichannelling. � It is not clear that HDTV has been or will be a driver of digital uptake. � SDTV quality is sufficient for home purposes - television does not need to be cinema quality. The House of Representatives Committee recommended that the current minimum HDTV quotas for FTA networks be retained until 1 January 2011, but that a review be held before that time to determine if HDTV quotas should be removed, increased or decreased. Application of the anti-siphoning regime Some respondents favoured allowing anti-siphoning list sports content on multichannels. This would allow Australians greater access to sport free of charge. However, some of these submitters also considered that this extra capacity should give rise to `use it or lose it' provisions to prevent hoarding of rights. Respondents in favour of applying content obligations to multichannels argued that it is important to maintain the integrity of the anti-siphoning scheme. Therefore anti- siphoning list content should only be shown on the main simulcast channel and should have anti-hoarding provisions. New commercial television licences - Government decision making A range of stakeholders and interested parties provided comment on this aspect of the review, however, the comments generally did not extend to a desired means of giving effect to the proposed changes. Rather, most respondents expressed their views in terms of support for or concerns about transferring the licence allocation decision making powers to the government. Respondents put forward a range of reasons in support of the Government's proposal. Some submitters suggested that the government should adopt a process other than

30 price based allocation so that the service provided by any new entrant embodies the values desired (such as quality, diversity, innovation), including with special consideration given to levels of Australian programming and content sourced from independent production companies. Another suggestion was that the legislation should limit the number of commercial television broadcasting licences in each area to three, so that changes would not be made unless the Parliament was convinced that the potential costs were outweighed by the benefits of a new licence. Of the respondents who expressed concerns about transferring the decision making powers to the government of the day, some considered that the government role should be one of setting the parameters and goals of regulation, rather than becoming involved in regulatory process or determining outcomes which should be left to market forces. Respondents noted the importance of retaining transparent administrative or judicial processes in administration of licences. A number of submitters considered that ACMA has the technical and planning expertise to make decisions in relation to the allocation of new licences and that its independence was a key component of the licence allocation process. Some considered that if the government was to have a decision making role, ACMA or some other independent body should have a key role in providing input to the government. Some comment was made that there would need to be clear demarcation and complementarity between the Minister's role and the role of ACMA to avoid duplication of investigative and consultative processes, and that planning processes may need to be revised to accommodate a government decision making role. It was also noted that it may be possible to use existing processes under the BSA if ACMA was to have an advisory role. Section 40 licences Few respondents addressed the issue of section 40 commercial television services. One respondent suggested that the current licensing arrangements for section 40 services should continue as they are effective in allowing for delivery of television through alternative means. Australian content obligations Some respondents argued that multichannels should only be subject to content restrictions which protect consumers, such as those relating to adult and illegal material. This would increase the ability of broadcasters to provide channels which appeal to consumers and will improve the viability of multichannels, which may be too marginal a proposition to succeed were Australian content or other obligations imposed, due to the higher cost of Australian content, in particular. These respondents contend that requiring 55 per cent Australian content, or even imposing any Australian content obligation, may make any multichannel financially unviable in the short to medium term. Respondents in favour of applying content obligations to multichannelling made the following arguments: � local content should be required on all channels as they will not `resonate' with Australian audiences unless this happens;

31 � the government needs to set the ground rules for digital broadcasting; and � it is appropriate to impose content obligations when valuable spectrum has been granted to broadcasters for free. Captioning requirements Some submitters called for captioning on all multichannels, including incorporating Human Rights and Equal Opportunity Commission-arbitrated arrangements, arguing that alleged practical problems of meeting this requirement were not significant. Others suggested captioning requirements be phased in or delayed on multichannels until overall digital uptake reached 25 per cent due to the large cost and small benefit of providing this service given the expected small audience of these channels. Program standards In the context of the possible allocation of an additional commercial television broadcasting licence, there was general support for applying the conditions currently faced by incumbents relating to content standards to any new entrant. Of particular concern to a number of the respondents was that the Australian Content Standard should be equitably applied to both existing broadcasters and new entrants. One respondent suggested that the current content standards could be adjusted in relation to multichannelling but that consumer protection measures, anti-siphoning arrangements and prohibitions on subscription services should apply equally to new players as they do to incumbents. In relation to captioning, some respondents argued that there are no technical or logistical reasons that captioning requirements could not be met by a new entrant from the commencement of the service. Respondents acknowledged the limited audience and therefore advertising revenue that would be available to a new digital only television service at start-up. It was suggested that some content standards such as the HDTV quota, Australian and children's content requirements could be relaxed to account for this inequity, but should be based on an assessment of the cost of complying with the full conditions. All respondents who addressed this issue agreed that ultimately the same conditions should apply to all commercial television broadcasters. CONCLUSION AND RECOMMENDED OPTION Multichannelling There are differing views amongst stakeholders on the likely impact of multichannelling by commercial broadcasters and the ways in which it should be implemented. Concerns have been raised by some broadcasters about the commercial impact on both commercial FTA and subscription television broadcasters if the prohibition on multichannelling were to be removed now. In addition, some in the industry have raised concerns about the technical capacity of broadcasters to provide both multichannels and the highest quality HDTV (1080i) on their available spectrum using existing MPEG-2 compression standards.

32 In recognition of the need for a balanced approach to reform and to ensure industry stability, it is proposed to gradually implement changes to the current arrangements for multichannelling by commercial broadcasters until analogue switchover, at which time it is proposed to allow full multichannelling. (Option M3) This approach recognises that while multichannelling restrictions have provided a period of stability during the transition period to digital, analogue switchover provides a natural end point for these restrictions - a position which is already reflected in legislation. In the interim, from 1 January 2007 it is proposed to remove the requirement that the HDTV version of a broadcaster's digital service be a simulcast of its SDTV service. This would in effect permit an HDTV multichannel. It is also proposed to allow an SDTV multichannel from 2009. Evidence from overseas markets such as the UK suggests that public broadcasters can play a significant role in driving digital television take-up by providing attractive new digital content.2 It is appropriate for the national broadcasters to be innovators with the use of new technologies. An expanded ability to provide multichannelling has the potential to provide the ABC and SBS with substantial new opportunities to experiment with digital program production and new digital services such as interactivity. It would also be consistent with their public service role, for example, by enabling them to make further use of their valuable archival material. Anti-siphoning The anti-siphoning rules were introduced to ensure that important sporting events which have traditionally been available on FTA television would continue to be available to FTA broadcasters, despite the introduction of subscription television. The Government considers that this rationale remains, and Australian FTA broadcasters continue to provide high quality coverage of a large variety of sports valued by Australian audiences. Nevertheless, there is scope for further scrutiny of the anti-siphoning list and the number of events on it. The Government proposes to introduce a `use it or lose it' scheme to encourage broadcasters to ensure viewers benefit for their acquisition of this content. The Government also proposes a review of the scheme in 2009. Pending this review it is appropriate to ensure the spirit of the scheme is complied with. Therefore, Option A3 is favoured. Under this option, the acquisition of rights to an event on the anti-siphoning list by a commercial FTA broadcaster operating outside the BSB would not satisfy the requirement that before a subscription TV licensee could acquire rights, a national or commercial FTA broadcaster must have acquired the rights or the event has been delisted. In addition, it is proposed that FTA broadcasters would be prohibited from broadcasting sports events on the anti-siphoning list on any digital multichannels 2 For example, the BBC has played a significant role in the UK as a driving force in the establishment of the Freeview platform and by adopting and demonstrating the innovative programming enabled by digital television such as interactive programming. Whilst there are differences between the UK and Australia, including the significant source of funding for the BBC provided through licence fees, there are lessons for Australia from the UK's apparent success in implementing digital television with strong leadership from the public broadcaster.

33 unless the content has already been shown (or is shown simultaneously) on their main channel3. While digital take-up is still relatively low, the migration of events on the anti-siphoning list to multichannels would be inconsistent with the objective of the anti-siphoning scheme, which is to provide the widest access for viewers to listed events. New commercial television licences - section 40 licences Option L2, which implements the Government's election commitment is proposed, as it is considered that the decision on whether a new commercial television broadcasting licence should be allocated is an important one which should be made by Government. Content codes and standards Services operating under section 40 licences will have lesser influence (initially at least) than other commercial television services as they will operate on a separate platform, are likely to attract a small audience and will not be readily receivable by standard televisions. As such, it is in keeping with the policy objectives of the BSA that these services should be regulated to a less onerous extent. Section 40 licences should, however be subject to conditions relating to program classification and conditions about broadcasting certain types of material which apply to all types of broadcasters. Children's and Australian content standards are initially likely to impose significant cost burdens on new broadcasters. However, it is desirable that in the longer term all commercial broadcasters meet the same level of Australian and children's content obligations. Compliance with captioning standards will also apply over time. Multichannels will also initially reach a much smaller audience than the main analogue/SDTV channel. Therefore it is appropriate that a lighter regulatory burden be placed on multichannels. Standards common to all broadcasters should be applied, but it is proposed not to require multichannels to provide a specified amount of Australian or children's' content pending a review of regulation of the regulatory obligations to be placed on multichannels in the future. It is likely that broadcasters may choose to provide children's and Australian content on these channels as it is attractive to audiences and, children's content in particular has provide popular for multichannels overseas. IMPLEMENTATION The proposed arrangements will be implemented by changes to the BSA and related legislation and legislative instruments. Later in 2006, the Government will also release a Digital Action Plan to expedite conversion to full digital television and achieve switchover. The Plan would be released in 2006 and aim for a switchover period commencing in 2010-2012. 3 In this context, the main channel is the digital channel which is the simulcast of the analogue channel.

34 Reviews are also planned before analogue switchover in relation to the anti-siphoning scheme, the regulation of multichannels, and whether new commercial television broadcasting licences should be allocated.

35 NOTES ON CLAUSES Clause 1 - Short title Clause 1 provides for the citation of the Broadcasting Legislation Amendment (Digital Television) Act 2006 (the Act). Clause 2 - Commencement Clause 2 provides that the amendments made in Schedule 1 to the Bill commence on the day after the day on which the Act receives the Royal Assent. Schedule 2 is to commence on 1 January 2007. New Schedule 2A will commence by proclamation within the period of six months from the day on which the Act receives Royal Assent, or on the first day after the end of the six month period. Schedule 2A relates to technical standards for transmission of broadcasting services, datacasting services and receivers for use in reception of digital television services, and industry codes and standards for digital television and reception equipment. Commencement by proclamation is necessary to allow time for the ACMA to make standards about matters that are currently the subject of regulations made under provisions to be repealed by Schedule 2A. Schedule 3 is to commence on 1 January 2009. The remainder of the Bill is to commence on the day of Royal Assent. Clause 3 - Schedule(s) By virtue of this clause, provisions of the Broadcasting Services Act 1992 (BSA) and the Radiocommunications Act 1992 (RA) are amended as set out in the Schedules to the Bill.

36 SCHEDULE 1 - AMENDMENTS COMMENCING ON THE DAY AFTER ROYAL ASSENT Schedule 1 makes a series of amendments to the BSA and the RA in order to permit national broadcasters to freely multi-channel their national television broadcasting services. The current genre restrictions on multi-channelled national television broadcasting services are to be repealed. National broadcasters are currently permitted to provide multi-channels, subject to genre rules which are defined in clause 5A of Schedule 4 to the BSA. They are restricted to a specified range of programs such as educational programs, regional news and current affairs, science and arts programs, children's programs and occasional dramas. Both the Australian Broadcasting Corporation (ABC) and the Special Broadcasting Service (SBS) are currently providing multi-channels. The Bill will remove these current genre restrictions to allow national broadcasters to provide a full range of broadcasting services on their multi-channels. The only limitation on multi-channelling by the ABC and SBS would be that events on the anti-siphoning list could not be premiered on multi-channels. Schedule 1 also amends the licence condition for subscription television broadcasters to ensure that subscription television broadcasters cannot acquire rights to events on the anti-siphoning list unless: � a national broadcaster has the right to televise the event; or � a commercial television broadcasting licensee operating within the broadcasting services bands (BSB) of spectrum and covering more than 50% of the population has the right to televise the event. Part 1 - Amendments Broadcasting Services Act 1992 Item 1 - Subsection 6(1) Item 1 of Schedule 1 inserts a new definition of "anti-siphoning event" in section 6 of the BSA. An anti-siphoning event is an event specified in the anti-siphoning list, regardless of whether the event is subject to automatic de-listing under subsections 115(1AA) or 115(1B). Under subsection 115(1) of the BSA, the Minister for Communications, Information Technology and the Arts (the Minister) specified a list of events that should be made available free to the general public (the anti-siphoning list). The anti-siphoning rules were introduced to ensure that important sporting events which have traditionally been available on free-to-air (FTA) television would continue to be freely available to audiences. The current anti-siphoning list commenced on 1 January 2006 and continues until 31 December 2010. Item 1 of Schedule 1 is related to Item 18 of Schedule 1, which inserts new Part 4A of Schedule 4 to the BSA. New Part 4A provides that a national broadcaster must not televise the whole or part of an anti-siphoning event on a standard definition television (SDTV) multi-channel unless the whole or part of the event has been

37 previously televised on the simulcast service, or the event is televised simultaneously on the multi-channel and the simulcast service. Item 2 - Subsection 18(2) Item 2 of Schedule 1 is consequential to Item 10 of Schedule 1. Item 2A - Before section 27 Item 2A of Schedule 1 adds new section 26B to the BSA. New section 26B provides that, for the duration of the simulcast period or simulcast-equivalent period (as the case may be), licence area plans (LAPs) are not required to deal with SDTV multi- channelled national television broadcasting services. It is considered unnecessary to include SDTV multi-channels in LAPs because the radiofrequency spectrum that will be used by the national broadcasters to provide multi-channels has already been allocated and planned by the Australian Communications and Media Authority (ACMA). After the end of the simulcast period or simulcast-equivalent period (as the case may be), all services provided by the national broadcasters would need to be planned, including multi-channels. New sections 26A and 26B (as amended by Items 6A-6D of Schedule 2 and Items 2A-2C of Schedule 3) similarly provide that HDTV multi-channels provided by existing commercial and national broadcasters do not need to be included in LAPs. Item 3 - Section 146B (paragraph (b) of the definition of televise) Item 3 of Schedule 1 is consequential to Item 10 of Schedule 1. As national broadcasters may provide more than one stream of television programming (multiple "channels"), the definition of "televise" in section 146B is to be amended to include multiple services provided by a national broadcaster. The effect of this amendment is that the anti-hoarding rules in Part 10A of the BSA would apply where the broadcaster acquires the right to televise events on either the main channel (ie. the channel simulcast in both analogue and digital mode in accordance with clause 19 of Schedule 4) or on a multi-channel. Item 5 - Subparagraph 10(1)(e)(ii) of Schedule 2 Item 6 - Subclause 10(1A) and (1B) of Schedule 2 Items 5 and 6 of Schedule 1 amend the licence condition in paragraph 10(1)(e) of Schedule 2 to the BSA to provide that subscription television broadcasting licensees are subject to a licence condition that the licensee cannot acquire rights to events on the anti-siphoning list unless: � a national broadcaster has the right to televise the event; or � a commercial television broadcasting licensee (other than a licensee operating under a licence issued under subsection 40(1) of the BSA) covering more than 50% of the population has the right to televise the event.

38 These Items ensure that subscription television broadcasting licensees are not able to rely on the acquisition of rights to sporting events on the anti-siphoning list by s.40 commercial television licensees in order to authorise the acquisition of rights to the event by the subscription television broadcaster. Section 40 of the BSA provides for the allocation of commercial television broadcasting licences for use outside of the BSB. These licences do not include any access to spectrum or other carriage rights. The licensee must arrange separately for the carriage of the service on a platform outside of the BSB (eg. the licensee must obtain an appropriate transmitter licence under the RA if the service is to be made available using radiocommunications transmitters). Currently there are no television licences issued under section 40 due to the moratorium on the issue of new commercial television broadcasting licences before 31 December 2006 (section 28 of the BSA). If section 40 television licences are issued after the end of the moratorium, they are likely to be less accessible to Australian audiences due to their carriage on platforms outside the BSB (ie. standard television reception equipment would not receive section 40 services). Thus, it is not consistent with the object of the anti-siphoning scheme to permit the acquisition of rights by a commercial television broadcaster operating outside the BSB to satisfy the pre-condition for the acquisition of rights by subscription television broadcasting licensees. Item 7 - Clause 2 of Schedule 4 (definition of multi-channelled national television broadcasting service) Item 7 of Schedule 1 is consequential to Item 10 of Schedule 1. Item 8 - Clause 2 of Schedule 4 Item 8 of Schedule 1 inserts a new definition of "news or current affairs program", and is consequential to Item 18 of Schedule 1. This definition is consistent with the current definition of this phrase in Schedule 6 to the BSA. The definition includes news bulletins, sports news bulletins, and programs which provide analysis, commentary or discussion designed to inform the community about political, social or economic issues. For example, a program of this kind could include a documentary regarding female athletes performing in the Olympic games, with excerpts of particular events such as gymnastics. Such a program would be able to be transmitted on the multi-channel, without necessarily being shown on the core channel (for example, see Item 18 which inserts new clause 41H of Schedule 4). Item 9 - Clause 2 of Schedule 4 Item 9 of Schedule 1 is consequential to Item 18 of Schedule 1. Item 9A - Clause 2 of Schedule 4 Item 9B - Before clause 5 of Schedule 4

39 Items 9A and 9B of Schedule 1 insert new clause 4D of Schedule 4 and make a consequential amendment to the definition of "simulcast-equivalent period" in Schedule 4. New clause 4D will replace the existing concept of a "simulcast-equivalent period" in relation to the coverage area of national broadcasters (see Item 48 of Schedule 2 to the Bill). The extended concept of a "simulcast-equivalent period" will capture non- remote coverage areas, in addition to remote coverage areas, that do not have a simulcast period. The extension of the concept of a "simulcast-equivalent period" and other relevant amendments will ensure that the following obligations on national broadcasters will apply effectively: � HDTV quotas (see Item 70 of Schedule 2); and � captioning obligations (see Item 85 of Schedule 2). Limitations on the broadcast of anti-siphoning events on multi-channels during the simulcast period will also be extended to the simulcast-equivalent period (see Item 18 of Schedule 1, Item 87 of Schedule 2 and Item 16 of Schedule 3). Item 10 - Clause 5A of Schedule 4 Item 10 of Schedule 1 repeals the current definition of "multi-channelled national television broadcasting service" in clause 5A of Schedule 4 to the BSA. This definition includes the genre rules, which limited the types of programs that could be broadcast by the ABC and SBS on their multi-channelled television services. Item 10 inserts a new definition of "SDTV multi-channelled national television broadcasting service". A television service provided by the ABC or SBS is a SDTV multi-channelled national television broadcasting service if: � the service is transmitted in SDTV digital mode using multi-channelling transmission capacity; � the service is promoted as distinct from other services provided by the ABC or SBS respectively; and � the national broadcaster has given the Minister a written notice electing that the service is a SDTV multi-channelled national television broadcasting service (new subclause 5C(1) of Schedule 4). In requiring that the service be promoted as distinct from another service provided by the ABC or SBS, it is intended that the SDTV multi-channelled service be distinguished from the television service provided by the national broadcaster simultaneously in analogue and digital mode in accordance with clause 19 of Schedule 4 to the BSA (the simulcast service) during the simulcast period. Each service must be accessible as a separate programming stream to consumers using digital television receivers.

40 A notice given by a broadcaster to the Minister in relation to a SDTV multi- channelled national television broadcasting service will only have effect if the broadcaster still provides a service simultaneously transmitted in analogue and digital mode in accordance with clause 19 of Schedule 4 to the BSA (new subclause 5C(2) of Schedule 4 to the BSA). Item 11 - Subclause 19(7B) of Schedule 4 Item 12 - Subclause 20(1A) of Schedule 4 Item 13 - Paragraph 23(4)(b) of Schedule 4 Item 14 - Subclause 36(1) of Schedule 4 Item 15 - Subclause 36(1) of Schedule 4 Item 16 - Paragraph 37F(4)(c) of Schedule 4 Item 17 - Paragraph 37H(3)(c) of Schedule 4 Items 11-17 of Schedule 1 are consequential to Item 10 of Schedule 1. Item 18 - After Part 4 of Schedule 4 Item 18 of Schedule 1 inserts a new Part 4A of Schedule 4 to the BSA. New Part 4A relates to restrictions on televising anti-siphoning events on multi-channels. New clause 41H applies to national broadcasters during the simulcast period or simulcast-equivalent period (new subclause 41H(1) of Schedule 4). A national broadcaster must not televise the whole of an anti-siphoning event on a SDTV multi- channelled national television broadcasting service unless: � the national broadcaster has previously televised the whole anti-siphoning event on the simulcast service; or � the national broadcaster will televise the whole anti-siphoning event simultaneously on both the simulcast service and the SDTV multi-channelled national television broadcasting service (new subclause 41H(2) of Schedule 4). Similarly, a national broadcaster must not televise a part of an anti-siphoning event on a SDTV multi-channelled national television broadcasting service unless: � the national broadcaster has previously televised that part of the anti-siphoning event on the simulcast service; � the national broadcaster will televise that part of the anti-siphoning event simultaneously on both the simulcast service and the SDTV multi-channel; or � the national broadcaster televises the part of the anti-siphoning event in a news or current affairs program (new subclause 41H(3) of Schedule 4).

41 o Note that the term "news or current affairs program" will be defined in clause 2 of Schedule 4 to the BSA (see Item 8 of Schedule 1). It is intended that the exception allowing the televising of parts of anti-siphoning events in news or current affairs programs will permit national broadcasters to transmit a news or current affairs program with a sports segment on the SDTV multi- channel, and that the sports segment may include televised excerpts from anti- siphoning events. However, this exception would not cover, for example, a sports highlights program which televised significant excerpts from previously un-televised anti-siphoning events, broken only by short commentary segments. Item 19 - Paragraphs 45(2)(a), 45A(3)(a) and 46(2)(a) of Schedule 4 Item 19 of Schedule 1 makes technical amendments to clauses 45, 45A and 46 of Schedule 4 to the BSA as a consequence of Item 10. Item 20 - Clauses 60 and 60A of Schedule 4 Item 20 of Schedule 1 repeals clauses 60 and 60A of Schedule 4 to the BSA as these provisions are spent. Clauses 60 and 60A required the Minister to cause to be conducted a series of reviews in relation to digital television, and to cause copies of reports documenting the findings of these reviews to be tabled in Parliament. These reviews were required to be conducted by 1 January 2005 and 1 July 2005). These reviews have now been conducted and reports from the reviews tabled in Parliament, and accordingly these provisions can be repealed as spent provisions. Radiocommunications Act 1992 Item 21 - Paragraph 100A(1)(b) Item 22 - Subsection 100B(1) Item 23 - Paragraph 100D(1)(c) Item 24 - Paragraph 100D(1)(d) Item 25 - Subsection 100D(1) Item 26 - Subsection 100D(2) (definition of multi-channelled national television broadcasting service) Item 27 - Subsection 100D(2) Items 21-27 of Schedule 1 make technical amendments consequential to Item 10 of Schedule 1. Part 2 - Transitional provisions Item 28 - Notices about SDTV multi-channelled national television broadcasting service

42 Item 28 of Schedule 1 is a transitional provision related to Item 10 of Schedule 1. The effect of Item 28 is that where the ABC or SBS has given a notice to the Minister in relation to an existing multi-channelled national broadcasting television service (under paragraph 5A(1)(g) of Schedule 4 to the BSA) and the notice is still in force immediately before the commencement of Schedule 1, the notice still has effect notwithstanding the repeal of clause 5A of Schedule 4 by Item 10. In such a case, the national broadcaster would not be required to issue a new notice to the Minister in relation to that service under new paragraph 5C(1)(d) of Schedule 4 (inserted by Item 5B) - the clause 5A notice would operate as a clause 5C notice. However, if the national broadcaster was to commence a new SDTV multi-channelled national broadcasting television service after the commencement of Schedule 1, the national broadcaster would need to give a notice to the Minister under new paragraph 5C(1)(d) of Schedule 4. Item 28A - Variation of national television conversion scheme As a result of the changes to be made to the BSA by the measures in the Bill (as amended), the ACMA will need to amend the national television conversion scheme to reflect the changes to the regulatory regime. Item 28A of Schedule 1 inserts a transitional provision into Schedule 1 to the Bill. It provides that where the ACMA varies the national television conversion scheme within 30 days of the commencement of Schedule 1 to the Bill (on the day after Royal Assent), the ACMA will not need to consult widely before making the variation. Clause 33 of Schedule 4 to the BSA, and section 17 of the Legislative Instruments Act 2003 (LIA), both of which deal with consultation requirements, will not apply to a variation in these circumstances. In such cases, it will be sufficient for the ACMA to make a copy of the proposed variation publicly available on its website for at least 5 business days. The reason for limiting the consultation period in relation to the national television conversion scheme is to ensure that the ACMA can implement the necessary changes as soon as possible after Royal Assent to the Bill. Importantly, these truncated consultation requirements will apply only to variations made by the ACMA which relate to transitional or consequential matters associated with the Bill. The ACMA will have limited discretion regarding the scope of the variation in these cases, and as such, a lengthy public consultation period is unnecessary. Item 29 - NBS Transmitter licences issued under section 100B of the Radiocommunications Act 1992 Item 29 of Schedule 1 is a transitional provision related to Item 22 of Schedule 1. Item 29 clarifies that the amendments made by Item 22 of Schedule 1 to subsection 100B(1) of the RA do not affect the continuity of national broadcasting service (NBS) transmitter licences issued under that provision before the day after Royal Assent (when Schedule 1 commences).

43 SCHEDULE 2 - AMENDMENTS COMMENCING ON 1 JANUARY 2007 Schedule 2 makes a series of amendments to the Broadcasting Services Act 1992 (BSA) and the Radiocommunications Act 1992 (RA) in order to: � remove the requirement that broadcasters provide a high-definition television (HDTV) simulcast version of their analogue and a standard definition television (SDTV) service; � remove the existing HDTV quota from the end of the simulcast period; � modify the power of the Australian Communications and Media Authority (the ACMA) to allocate commercial television broadcasting licences in the broadcasting services bands (BSB) so that the ACMA cannot exercise this power unless a decision has been taken by the Minister that such a licence should be allocated; � provide a power to the Minister to veto an application made to the ACMA for a new commercial television broadcasting licence in spectrum outside the BSB (under subsection 40(1) of the BSA) on the basis that the allocation of the licence would be likely to be contrary to the public interest; and � provide for the allocation of channels for new digital services. High Definition Television (HDTV) Clause 37E of Schedule 4 of the BSA provides that regulations must determine standards which require that a HDTV version of a non-remote commercial television service must be the same as both the analogue and SDTV version of the service, and that commercial television broadcasters must transmit a quota of 1040 hours of HDTV programming per year. Clause 37F provides identical provisions for national broadcasters in non-remote areas. The Bill will provide that the existing HDTV quota is lifted at the end of the simulcast period. The removal of the HDTV quota from switchover will allow enough time for HDTV to become sufficiently popular for there to be a strong market demand (in which case the quota would become redundant) or for HDTV to remain a small, niche service (in which case the quota may become counterproductive). The Bill will also remove, from 1 January 2007, the requirement that the HDTV version of the digital television service must be a simulcast of the SDTV service. In effect, commercial television and national broadcasters will be able to provide one HDTV multi-channel. A HDTV multi-channel will be subject to specific provisions relating to anti- siphoning, such that a commercial free-to-air (FTA) broadcaster could not use its HDTV multi-channel to premiere events on the anti-siphoning list. New commercial television broadcasting licences

44 The moratorium on new commercial television broadcasting licences imposed under section 28 of the BSA expires on 31 December 2006. This Bill will not re-impose the moratorium but will modify the power to allocate the new commercial television broadcasting licences within the BSB such that the ACMA cannot exercise this power unless a decision has been taken by the Minister that such a licence should be allocated. The Minister's decision would be informed by a review. This will implement the Government's election commitment to take a decision- making role in commercial television licensing. Similarly, this Bill will provide a power to the Minister to veto an application made to the ACMA for a new commercial television broadcasting licence outside the BSB (under section 40 of the BSA) on the basis that the allocation of the licence would be likely to be contrary to the public interest. This is also in keeping with the Government's election commitment. The Bill will also provide that certain standard licence conditions and program standards for commercial television broadcasting licences do not apply to commercial television services operating outside the BSB, and that certain tailored conditions and standards apply to these types of licences. Services operating outside the BSB will have lesser influence (particularly initially) than other commercial TV services as they will operate on a separate platform, are likely to attract a small audience and will not be readily receivable by standard television receivers. As such, it is in keeping with the policy objectives for broadcasting that these services should be regulated to a less onerous extent. An appropriate level of regulation will ensure that community standards and safeguards are maintained. Allocation of channels for new digital services (channel A and channel B) The Bill will provide for the allocation of two types of datacasting transmitter licences, a channel A datacasting transmitter licence and a channel B datacasting transmitter licence. Both channel A and channel B licensees will be required to operate in digital mode. In relation to the channel A licences, the Bill will provide that: � Licensees may only provide datacasting, narrowcasting and community broadcasting to domestic digital television receivers; � Commercial television broadcasting licensees and national broadcasters may not control the datacasting transmitter licences; � The price-based allocation system for allocation of channel A licences designed by the Australian Communications and Media Authority (ACMA) must include preconditions for participation in the allocation and the Minister may direct the ACMA in regard to these pre-conditions; and � The ACMA may impose licence conditions, including in relation to rollout obligations on channel A licences, with the Minister to have the power to direct the ACMA about imposition of such conditions.

45 In relation to the channel B licences, the Bill will provide that: � Licensees may provide datacasting services under a BSA datacasting licence, another licence allocated by ACMA under the BSA authorising provision of that service, or a service provided in accordance with a class licence under the BSA. However, licensees cannot provide commercial broadcasting services, subscription television services to domestic digital television receivers, services provided by commercial television broadcasting licenses or national broadcasters to domestic digital television receivers, retransmission of an existing commercial television broadcasting or national broadcasting service to domestic digital television receivers; � Commercial television broadcasting licensees and national broadcasters cannot control the datacasting transmitter licence if it is used to provide services to domestic digital television receivers; and � Licensees must commence services within 18 months or such longer period allowed by the ACMA. Access regime for channel B This Bill also establishes an access regime which requires persons wishing to participate in the allocation process for a channel B datacasting transmitter licence to make an access undertaking, and for the ACCC to accept or reject that undertaking. � The access undertaking will provide for access to services that enable or facilitate the transmission of content services by content service providers. � The ACCC may develop criteria relating to its decision to accept or reject an access undertaking or variation of an access undertaking. The criteria will be a legislative instrument. � A person will not be not eligible to apply for a channel B datacasting transmitter licence unless they have submitted an access undertaking, and the ACCC has accepted it. � An accepted undertaking will become binding on a person who acquires a channel B datacasting transmitter licence. � Adherence to the terms of an undertaking will be a condition of the channel B datacasting transmitter licence. � If a the ACCC or a person affected by the undertaking considers that a person may have breached an undertaking, the ACCC or the affected person may apply to the Federal Court for an order to comply with the undertaking, or for compensation for damages. � The undertaking remains in force for the duration of the licence and is transferred if the licence is transferred. However, undertakings may be varied with the agreement of the ACCC.

46 Part 1 - Amendments Broadcasting Services Act 1992 Item 1A - Subsection 6(1) Item 1 - Subsection 6(1) (definition of commercial television broadcasting licence) Item 2 - Subsection 6(1) Item 3 - Subsection 6(1) Item 3A - Subsection 6(1) Items 1A-3A of Schedule 2 insert new definitions in subsection 6(1) of the BSA, which are used in later Items. Item 4 - Subsection 6(1) Item 4 of Schedule 2 is consequential to Items 8 and 88 of Schedule 2. Item 5 - After subsection 18(1) Item 5 of Schedule 2 inserts new subsections 18(1A) and 18(1B) of the BSA. Subsection 18(1) defines "open narrowcasting services" for the purposes of the BSA. Subsection 18(2) clarifies that a SDTV multi-channelled national television broadcasting service is not an open narrowcasting service. New subsections 18(1A) and 18(1B) similarly clarify that HDTV multi-channels provided by national and commercial television broadcasters are not open narrowcasting services. Item 6 - At the end of section 26 Item 6 of Schedule 2 inserts new subsections 26(3), (4), (5) and (6) of the BSA. This amendment is related to Item 8 of Schedule 2. Section 26 of the BSA requires the Australian Communications and Media Authority (the ACMA) to prepare licence area plans (LAPs) that determine the number and characteristics, including technical specifications, of broadcasting services that are to be available in particular areas of Australia (subsection 26(1)). In determining LAPs, the ACMA is required to have regard to a number of factors specified in section 23 of the BSA, including: � demand for, and efficient and effective use of, the radiofrequency spectrum; � demographics, social and economic characteristics within the licence area; � technological developments and technical barriers; and

47 � the number of existing services and the demand for new services. In issuing or varying a LAP, the ACMA is also required to make provision for wide public consultation (section 27). New section 35A (inserted by Item 8 of Schedule 2) provides that, before the end of the simulcast period, the Minister must cause to be conducted a review in relation to: � whether new commercial television licences should be allocated; and � if so, what variations should be made to LAPs (new section 35A(1)). The Minister may also conduct reviews subsequent to the initial review (new section 35A(2)). New subsection 26(3) provides that if a review is conducted under new section 35A, and the Minister is satisfied that a LAP should be varied, the Minister may give the ACMA a direction requiring the ACMA to vary the LAP in accordance with the direction. New section 35A provides for equivalent public consultation and consideration of planning issues in that review process (see subsections 35A(4) and (5)). Accordingly, in complying with a direction under new subsection 26(3), the ACMA would not be required to conduct a wide public consultation under section 27, nor would the ACMA be required to consider the planning issues specified in section 23 (new subsection 26(6)). Item 6A - After section 26 Item 6B - After subsection 26B(1) Item 6C - Subsection 26B(2) Item 6D - Subsection 26B(3) Items 6A-6D of Schedule 2 insert new section 26A of the BSA and make other amendments consequential to this amendment. New section 26A is similar to new section 26B, which is inserted by Item 2A of Schedule 1. New subsections 26A(1) and (2) of the BSA provide that, for the duration of the simulcast period or simulcast-equivalent period (as the case may be), LAPs are not required to deal with HDTV multi-channelled commercial television broadcasting services where the relevant commercial television broadcasting licence was in force immediately before 1 January 2007. It is considered unnecessary to include HDTV multi-channels in LAPs because the radiofrequency spectrum that will be used by the incumbent commercial broadcasters to provide multi-channels has already been allocated and planned by the ACMA. New subsection 26B(1A) similarly provides that LAPs are not required to deal with HDTV multi-channelled national television broadcasting services during the simulcast period or simulcast-equivalent period (as the case may be). LAPs will need to include HDTV multi-channels where a new commercial television broadcasting licence is issued during the simulcast period or simulcast-equivalent

48 period. Further, after the end of the simulcast period or simulcast-equivalent period (as the case may be), all services provided by commercial television broadcasters and national broadcasters will need to be planned, including multi-channels. Item 7 - Sections 28 and 28A Item 7 of Schedule 2 repeals sections 28 and 28A of the BSA. Section 28 of the BSA provides that ACMA must not allocate any new commercial television broadcasting licences in any licence area before 31 December 2006. This amounts to a moratorium on new free-to-air commercial television broadcasting licences until 2007. Section 28A provides for exemptions for licences issued under sections 38A and 38B designed to allow additional services to be provided by existing licences in underserved markets (ie. markets with 1 or 2 licences). As the moratorium ends on 31 December 2006, these provisions will be spent on 1 January 2007. Item 8 - Before section 36 Item 8 of Schedule 2 inserts new sections 35A and 35B of the BSA. In allocating commercial television broadcasting licences, the ACMA is required to determine a price-based allocation system (section 36 of the BSA). New sections 35A and 35B limit the ACMA's ability to allocate commercial television broadcasting licences in accordance with a price-based allocation determined under section 36. It is intended that the Government will have a decision-making role in relation to allocation of commercial television broadcasting licences in the BSB. The amendments will provide the Minister and thereby the Government with a role in addressing the policy questions associated with allocation of a commercial television licence, while the ACMA would continue to have a role in: � undertaking the technical investigations and planning exercises required before a new commercial television broadcasting licence could be allocated; and � allocating the licence under a price-based allocated system after receiving a direction from the Minister to allocate a licence. New section 35A provides that, before the end of the simulcast period, the Minister must cause to be conducted a review in relation to: � whether new commercial television licences should be allocated; and � if so, what variations should be made to LAPs (new subsection 35A(1)). The Minister may also conduct reviews subsequent to the initial review (new subsection 35A(2)). The power to conduct a review may be exercised from time to time as the Minister considers appropriate (see subsection 33(1) of the Acts Interpretation Act 1901 (AIA)). A number of matters must be taken into account in the conduct of the review, including:

49 � the objects of the BSA; � the matters referred to in section 23 (where relevant); � the availability of radiofrequency spectrum; and � any other relevant matters (new subsection 35A(3)). The matters listed in section 23 of the BSA include: � demand for, and efficient and effective use of, the radiofrequency spectrum; � demographics, social and economic characteristics within the licence area; � technological developments and technical barriers; and � the number of existing services and the demand for new services. The review must also be conducted in a manner that provides for wide public consultation (new subsection 35A(5)). Requiring wide public consultation and a consideration of the matters in section 23 of the BSA during the review ensures that, if the review leads to a direction by the Minister under new subsection 26(3) (see Item 6 of Schedule 2), it is appropriate for the ACMA to simply comply with the direction without conducting its ordinary processes as this would not adversely impact on the interests of industry and the public more broadly. The ACMA will also have provided information about the availability of spectrum and other issues relevant to planning and allocation of new licences to the Minister. The ACMA is obliged to make available any information that is reasonably necessary for the conduct of the review (new subsection 35A(6)). Once complete, the Minister must cause a report of the review to be prepared (new subsection 35A(7)). The report must be tabled in Parliament within 15 sitting days (new subsection 35A(8)). If a review is conducted under section 35A and the Minister is satisfied that a commercial television broadcasting licence should be allocated, the Minister may direct the ACMA to allocate the licence under section 36 (new subsection 35B(1)). The Minister may specify a period within which the allocation may take place. For example, the Minister might consider that there is a case for allocating a new licence in licence area A as soon as possible, but that no new licences should be allocated in licence area B until a year later. The Minister may direct the ACMA to allocate the licences in these licence areas accordingly. Importantly, it is intended that the Minister may direct the ACMA to allocate licences on several occasions (see section 33(1) of the AIA). After the completion of a review under section 35A, the Minister may issue a direction to the ACMA at any time within 3 years of the completion of the review report (new subsection 35B(1)). After this initial 3 year period, the Minister would need to conduct a further review under

50 subsection 35A(2) before directing the ACMA to allocate new commercial television licences. If the Minister issues a direction to the ACMA under subsection 35B(1), the ACMA is required to comply with the direction (new subsection 35B(2)). Further, the ACMA is prohibited from allocating any new commercial television broadcasting licences under section 36 unless the ACMA has been directed to allocate a licence (new subsection 35B(3)). Any new commercial television broadcasting licence issued after a direction by the Minister to the ACMA under subsection 35B(1) is authorised to provide services in digital mode only (new subsection 35B(4)). Thus, no new analogue commercial television broadcasting licences may be issued. This is consistent with the policy objective that television broadcasting be converted to digital mode as soon as is practicable. Item 9 - Subsection 36(1) Item 9 of Schedule 2 repeals subsection 36(1) of the BSA and substitutes a new subsection 36(1). The substantive difference between the original provision and the new provision is that the new provision does not include an out-of-date reference to section 28, which will be a spent provision on 31 December 2006 and is being repealed by Item 7 of Schedule 2. Item 9A - Subsection 38A(9) Item 9A of Schedule 2 makes a technical amendment to subsection 38A(9) of the BSA to ensure that licensees operating under a commercial television broadcasting licence allocated under section 38A are subject to a licence condition which requires the provision of at least one service under each of their licences (ie. both the parent licence and the additional 38A licence). This licence condition applies under each of the licences. Item 10 - Paragraph 38B(18)(a) Item 11 - Paragraphs 38B(18)(b) and (c) Item 12 - Subsections 38B(20) and (21) Items 10, 11 and 12 of Schedule 2 are consequential to Item 16. Item 13 - After subsection 40(1) Item 13 of Schedule 2 inserts new subsection 40(1A) of the BSA. Subsection 40(1) provides for the allocation by the ACMA of commercial broadcasting licences operating in spectrum outside the broadcasting services bands. New subsection 40(1A) provides that licences issued under subsection 40(1) are allocated on the basis of one licence per service. Relevantly, this amendment clarifies that broadcasters providing a commercial television broadcasting service under a licence issued under section 40 are not authorised to multi-channel. A commercial

51 television broadcaster which is licensed under section 40 could operate on a range of platforms which might have capacity to provide an unknown number of multi- channels. The requirement to provide only one service per licence is equivalent to that for subscription broadcasting, which may use similar platforms to section 40 broadcasters. Item 14 - Subsection 40(2) Item 14 of Schedule 2 makes a technical amendment consequential to Items 7 and 9 of Schedule 2. Item 15 - At the end of section 40 Item 15 inserts new subsections 40(5), (6), (7), (8), (9), (10), (11), (12) and (13) of the BSA. These provisions provide for the Minister to have a decision making role in relation to licences issued under subsection 40(1), and impose a condition on all section 40 licences that the licensee may only provide digital services. The effect of the amendments is that an application for licence to provide a commercial television broadcasting service outside the BSB must be initially made to the ACMA, but if the ACMA proposes to allocate a licence in accordance with the application, the ACMA must refer the application to the Minister (new subsection 40(5)). The Minister will then have the opportunity to consider the impact of the proposed service in terms of the public interest. The ACMA must not make a decision about the allocation until the Minister has informed the ACMA of his or her views in relation to the application (new subsection 40(6)). If the Minister is satisfied that the allocation of the licence would be likely to be contrary to the public interest, the Minister must direct the ACMA not to allocate the licence to the applicant (new subsection 40(7)). If the Minister is not of such an opinion, the Minister must notify the ACMA accordingly (new subsection 40(8)). In considering the public interest, the Minister will consider all matters relevant in the particular circumstances. It is anticipated that these matters could include: � the policy objects of the BSA; � the number and characteristics of existing broadcasting services available in the licence area; � the demand for new broadcasting services in the proposed licence area; and � the nature of the proposed service and the audience the licensee would target. The test is broadly framed to ensure that all relevant matters will be considered by the Minister before deciding whether or not a particular application should be granted. The breadth of the test is also appropriate given that each application is likely to vary significantly in its business model and operating platform. Importantly, Item 20 of Schedule 2 provides that the applicant may seek merits review of a direction by the Minister to the ACMA to not allocate a licence in a particular case.

52 The ACMA is required to comply with a direction by the Minister under new subsection 40(7) (new subsection 40(8)). The Minister may request further information from the applicant before making a decision, provided the request is made within 30 days of referral of the application to the Minister (new subsection 40(10)). If the Minister requests additional information, the Minister must provide a copy of the request to the ACMA so that the ACMA is kept informed (new subsection 40(11)). New subsection 40(12) provides that if the Minister does not make a decision within 60 days of receiving the application, or within 60 days of receiving additional information from the applicant (if this is requested), the Minister is deemed to have decided that the application is not contrary to the public interest and that the ACMA may proceed with the allocation of the licence. This provision for a deemed decision is drafted in favour of the applicant for the licence, and it will ensure that applications are processed in a prompt manner. New subsection 40(13) provides that where a commercial television broadcasting licence is allocated under section 40 of the BSA the licence authorises the provision of a digital service only. Thus, a television service provided under a section 40 licence cannot be transmitted in analogue mode. This measure is consistent with the Government's intention of facilitating the switchover of commercial television broadcasters from analogue television signals to digital mode. Item 16 - After section 41 Item 16 of Schedule 2 inserts new section 41A of the BSA. New section 41A provides that a commercial television broadcasting licence authorises the licensee to provide: � the core service, which is either: o simulcast in analogue and digital mode in accordance with Schedule 4 of the BSA; or o a single SDTV service (for new, digital only licences allocated after 1 January 2007); and � a HDTV multi-channel. Item 16 is related to the amendments made by Items 29 and 70. Item 29 amends the standard licence conditions applicable to commercial television broadcasting licences to require licensees to provide a HDTV multi-channel during the simulcast period. However, Item 70 repeals existing subclause 37E(1) of Schedule 4, which required commercial television broadcasting licensees in non-remote licence areas to provide a HDTV version of their service, and that the HDTV version of the service was to be a simulcast of the service provided in analogue and digital mode. The effect of these amendments is that commercial television broadcasting licensees are required to provide a HDTV multi-channel, but the programming provided on that

53 HDTV multi-channel may differ from that provided on the core service. Of course, if the broadcaster chose, the licensee could continue to provide a HDTV simulcast. New section 41A does not apply in relation to licences issued under subsection 40(1) (new subsection 41A(3)). Licences issued under subsection 40(1) are allocated on the basis of one service per licence (Item 4D of Schedule 2). Item 16A - After section 51 Item 16A inserts new section 51A into the BSA. This new section excludes channel B datacasting transmitter licences from the operation of the provisions in Part 5 of the BSA (which deals with control of commercial broadcasting licences and datacasting transmitter licences), except in cases where the transmitter is used to deliver a service to domestic digital television receivers. The Government intention is that channel B datacasting transmitter licences that are used to deliver services other than services capable of being received by domestic digital television receivers will be excluded from the operation of Part 5 of the BSA. The Government considers that where the new services to be provided on channel B transmitter licences are not delivered to normal domestic digital television receivers, it is not necessary to exclude existing free to air television broadcasters from controlling the supply of such services. The existing legislated prohibition in the BSA on commercial television broadcasters controlling a datacasting transmitter licence will continue to apply in respect of channel A datacasting transmitter licences, because services provided using a channel A datacasting transmitter licence are intended to be provided to the widest possible digital television audience and must be provided to domestic digital reception equipment. Item 17 - At the end of section 122 Item 17 of Schedule 2 inserts new subsections 122(7), (8), (9) and (10) of the BSA. The effect of these amendments is that during the simulcast period or simulcast- equivalent period, standards made by the ACMA under subsection 122(1) (Australian content and children's television standards) do not apply to a commercial television broadcasting service unless the service is the core service (new subsections 122(7) and (8)). These provisions ensure that the Australian content and children's television quotas cannot be satisfied by programming provided on multi-channels. By excluding multi-channels, the standards will be required to be satisfied by programming provided on the simulcast or main channel, thereby ensuring the free availability of this content to the widest possible audiences during the simulcast period. This will also provide time for multi-channels to be developed and become established before they are subject to the full suite of regulatory obligations. New subsection 122(9) provides that if a new commercial television broadcasting licence is allocated under section 36 (BSB services) or subsection 40(1) (non-BSB services), the Australian content and children's television program standards do not apply to the licensee during the first five years of operation. This concession is

54 designed to ensure that new services are able to emerge and establish operations in the market before the full suite of regulatory obligations is imposed on the licensee. Item 18 - At the end of section 123 Item 18 inserts new subsection 123(5) of the BSA. New subsection 123(5) clarifies that a reference to "broadcasting operations" in section 123 includes all the services provided by commercial television broadcasting licensees. This will ensure that the code of practice for the commercial television industry is required to apply to multi-channels. If the code of practice made inadequate provision in relation to multi-channels, the ACMA may impose a standard under section 125 of the BSA. Item 19 - Section 146B (paragraph (a) of the definition of televise) Item 19 of Schedule 2 makes a technical amendment consequential to Item 16 of Schedule 2. Item 20 - Section 204 (after table item dealing with subsection 40(1)) Item 20 inserts a new table row in section 204 of the BSA (the Administrative Appeals Tribunal review provision), as a consequence of the insertion of new subsection 40(7) by Item 15 of Schedule 2. This ensures that if the Minister directs the ACMA under subsection 40(7) not to allocate a new commercial television licence to a particular applicant, the applicant may seek merits review of this decision in the AAT. Item 21 - Paragraph 205B(1)(a) Item 22 - Subparagraph 205B(1)(c)(i) Item 23 - Paragraph 205B(1)(d) Items 21-23 of Schedule 2 make technical amendments consequential to Item 16 of Schedule 2. Item 23A - After subsection 212(2A) Item 23A inserts new subsections 212(2B) and 212(2C) into the BSA. New subsection 212(2B) allows an action, suit or proceeding to be taken against a person in relation to a breach of any of the conditions in the Radcomms Act relating to the transmission by a datacasting transmitter licensee of a BSA exempt re- transmission service. This amendment is necessary to enable the enforcement of the provisions in the Radcomms Act relating to retransmission using datacasting transmitter licences. New subsection 212(2C) provides the Minister with a power to direct the ACMA in relation to the exercise of the power conferred on the ACMA by section 212(1)(b)(ii) of the BSA. This amendment enables the Minister to direct ACMA in relation to permitting out-of-area retransmission.

55 These provisions might be used, for example to permit out-of-area retransmission of services where the datacasting transmitter licensee had limited technical options other than to transmit by a single frequency network which encompassed areas outside the licence area in question. Item 24 - Paragraph 212(3)(a) Item 24 of Schedule 2 makes technical amendments consequential to Item 16 of Schedule 2. Item 25 - Paragraph 7(1)(c) Item 25 of Schedule 2 amends the standard licence condition in paragraph 7(1)(c) of Schedule 2 to the BSA for commercial television broadcasting licensees in relation to the requirement to include certain provisions in the articles of association of the licensee. These required provisions relate to the current cross-media and foreign ownership rules. The effect of this amendment is to exclude licensees operating under licences issued under subsection 40(1) from this requirement. This is appropriate because the amendments made in the proposed Broadcasting Services Amendment (Media Ownership) Bill 2006 exclude section 40 licensees from the operation of the media diversity rules in Part 5 of the BSA (Item 3 of Schedule 1 of that Bill). Item 26 - Paragraph 7(1)(f) of Schedule 2 Item 27 - Paragraph 7(1)(h) of Schedule 2 Item 28 - Paragraph 7(1)(i) of Schedule 2 Items 26-28 of Schedule 2 make technical amendments consequential to Item 16 of Schedule 2. Item 29 - After paragraph 7(1)(m) of Schedule 2 Item 29 inserts new paragraphs 7(1)(ma), (mb) and (mc), which consequentially amends the standard licence conditions for commercial television broadcasting licensees as a result of the amendments made by Item 70. New paragraph 7(1)(ma) requires commercial television broadcasting licensees to provide a HDTV multi-channel during the simulcast period for the licence area in which they operate. New paragraph 7(1)(mb) requires commercial television broadcasting licensees in a licence area to provide a HDTV multi-channel during the `simulcast-equivalent period' if: � no simulcast period applies in relation to the licence area (eg. in remote areas where the digital conversion scheme has not provided for a simulcast period); and � there are regulations in place imposing HDTV requirements.

56 New paragraph 7(1)(mc) provides that if a commercial television broadcasting licence was allocated under section 38A or 38B, and there is a simulcast-equivalent period for the licence, the licensee is required to provide an HDTV multi-channelled commercial television broadcasting period during the simulcast-equivalent period. These new paragraphs are subject to the qualifications in subclauses 7(5), (6) and (7) of Schedule 2 (to be inserted by Item 40 of Schedule 2 to the Bill). Importantly, if there is a multi-channelling election in force, the licensee is not required to provide an HDTV service. If the licensee revoked the election and the ACMA approved the revocation under new clause 7B (see Item 51A of Schedule 2), the licensee would be subject to HDTV quota requirements from the time the revocation takes effect. The simulcast-equivalent period is defined under Items 47 and 48 of Schedule 2. This Item is related to Item 40, which inserts qualifications on the operation of these new licence conditions. If a licensee breached a new licence condition, enforcement action could be taken in relation to the breach (eg. in relation to an offence under section 139 of the BSA). The requirement to provide a HDTV version of the service does not require a licensee to transmit continuously (ie. on a 24 hours a day, seven days a week basis). As with SDTV multi-channels able to be provided from 1 January 2009 (in accordance with the amendments made in Schedule 3), the broadcaster may choose to transmit the HDTV multi-channel only part of the time. Provided the licensee complies with the HDTV quota obligations in clause 37E of Schedule 4 (see Item 70 of Schedule 2), the hours of transmission are at the discretion of the licensee. Item 30 - Paragraph 7(1)(na) of Schedule 2 Item 31 - After paragraph 7(1)(na) of Schedule 2 Items 30 and 31 of Schedule 2 make technical amendments consequential to Item 70 of Schedule 2. Item 32 - Paragraph 7(1)(o) of Schedule 2 Item 32 of Schedule 2 makes a technical amendment consequential to Item 85 of Schedule 2. Item 33 - After paragraph 7(1)(oa) of Schedule 2 Item 33 of Schedule 2 inserts new paragraph 7(1)(ob), which imposes a new licence condition on commercial television broadcasting licensees. The licence condition in new paragraph 7(1)(ob) requires licensees to comply with restrictions on the televising of anti-siphoning events. Item 33 is related to Item 86 of Schedule 2. Item 34 - Paragraph 7(2)(a) of Schedule 2 Item 34 of Schedule 2 amends the standard licence condition in paragraph 7(2)(a) for commercial television broadcasting licensees in relation to the requirement to provide a service that, when considered together with other broadcasting services provided in

57 the licence area, contributes to the provision of an adequate and comprehensive range of broadcasting services in that licence area. The effect of this amendment is to exclude licensees operating under licences issued under subsection 40(1) from this requirement. This is appropriate because commercial television broadcasting services provided under subsection 40(1) licences will operate on a separate platform, potentially in a distinct licence area, and are likely to require special reception equipment and so will have a less significant impact on audiences than other commercial television broadcasting services. Item 35 - Paragraph 7(2)(a) of Schedule 2 Item 35 of Schedule 2 makes a technical amendment consequential to Item 16 of Schedule 2. Item 36 - Paragraph 7(2)(c) of Schedule 2 Item 36 of Schedule 2 amends the standard licence condition in paragraph 7(2)(c) for commercial television broadcasting licensees in relation to the requirement for licensees to broadcast matter of a religious nature. The effect of this amendment is to exclude licensees operating under licences issued under subsection 40(1) from this requirement. This is appropriate because commercial television broadcasting services provided under subsection 40(1) licences will operate on a separate platform and are likely to require special reception equipment and so will have a less significant impact on audiences than other commercial television broadcasting services. Item 37 - Paragraph 7(2A)(d)(i) of Schedule Item 37 of Schedule 2 makes a technical amendment consequential to Item 16 of Schedule 2. Item 38 - Paragraph 7(2B) and (2C) of Schedule 2 Item 38 of Schedule 2 amends the standard licence conditions in paragraphs 7(2B) and (2C) for commercial television broadcasting licensees in relation to the provision of information to other commercial and national broadcasters for inclusion in an electronic program guide. The effect of this amendment is to exclude licensees operating under licences issued under subsection 40(1) from this requirement. This is appropriate because commercial television broadcasting services provided under subsection 40(1) licences will operate on a separate platform and are likely to require special reception equipment and so will have a less significant impact on audiences than other commercial television broadcasting services. Item 39 - Subclause 7(3) of Schedule 2 Item 39 of Schedule 2 is consequential to Item 40. Item 40 - After the end of clause 7 of Schedule 2

58 Item 40 of Schedule 2 inserts new subclauses 7(5), (6), (7) and (8) of Schedule 2. These amendments are related to Item 29 as these paragraphs qualify the operation of the new licence conditions in paragraphs 7(1)(ma), (mb) and (mc). These licence conditions, which require the provision of a HDTV multi-channel during the simulcast or simulcast equivalent period (as relevantly applies), do not apply where the licensee is operating under a limited-capacity transmitter issued following the contravention of HDTV standards (new subclause 7(5)). The licence conditions also do not apply where the licensee provides a service under a licence issued under sections 38A or 38B (which relate to under-served markets) and a multi-channelling election is in force under Schedule 4 (new subclauses 7(6) and (7)). The purpose of a multi-channelling election is to authorise the licensee or licensees to transmit services provided under more than one licence using multi- channelling transmission capacity with exemption from any HDTV obligations that would otherwise apply to the licensee or licensees. Item 41 - Paragraph 10(1)(e)(i) of Schedule 2 Item 41 of Schedule 2 makes a technical amendment consequential to Item 16 of Schedule 2. Item 42 - Paragraph 10(1A) of Schedule 2 Item 43 - Paragraphs 10(1B)(a) and (b) of Schedule 2 Items 42 and 43 of Schedule 2 make technical amendments consequential to Item 16. Item 44 - Clause 2 of Schedule 4 Item 45 - Clause 2 of Schedule 4, Item 46 - Clause 2 of Schedule 4 Item 47 - Clause 2 of Schedule 4 (definition of simulcast-equivalent period) Items 44-47 of Schedule 2 insert new definitions into Schedule 4 of the BSA, and are consequential to Items 48, 49 and 50 of Schedule 2. Item 48 - After clause 4B of Schedule 4 Item 49 - Before clause 5C of Schedule 4 Item 50 - At the end of Part 1 of Schedule 4 Items 48-50 of Schedule 2 insert new clause 4C of Schedule 4 (definition of "simulcast equivalent period"), new clause 5B (definition of "HDTV multi-channelled commercial television broadcasting service"), new clause 5D (definition of "HDTV multi-channelled national television broadcasting service") and new clause 5E (definition of "Designated HDTV multi-channelled national television broadcasting

59 service"). These new definitions are required as a consequence of Items 29 and 70 of Schedule 2. In remote licence areas, the ACMA has discretion to provide for a simulcast period. If the ACMA has not made such a provision, clause 4C provides for the ACMA to declare a "simulcast-equivalent period" to give effect to HDTV, anti-siphoning and other obligations until analogue switchover. Some non-remote licence areas may also not have a simulcast period. For example, in relation to under-served markets, some licensees operating under commercial television broadcasting licences allocated under section 38B of the BSA will have a simulcast period or simulcast-equivalent period, due to their operation in an existing licence area. However, where the ACMA has amalgamated two licence areas under subsection 38B(14), it is not clear that the section 38B licence area has a simulcast period. The ACMA will be able to determine a simulcast-equivalent period in these cases. National broadcasters will, when Schedule 1 comes into effect, be able to provide as many multi-channels as their spectrum capacity allows. Depending on standards and compression technology chosen, it may be possible to provide more than one HDTV multi-channel. If more than one HDTV multi-channel is provided, the national broadcaster is required to nominate which of these HDTV channels is to be the "designated HDTV multi-channelled national television broadcasting service" to which the HDTV quota obligations will then apply. Item 50A - After subclause 6(5B) of Schedule 4 Item 50B - Paragraph 6(7C)(b) of Schedule 4 Item 50C - Subclauses 6(7D) and (7E) of Schedule 4 Item 50D - Subparagraph 6(7F)(b)(ii) of Schedule 4 These Items insert new subclause 6(5BA) of Schedule 4 to the BSA and make other consequential amendments. New subclause 6(5BA) provides that an election to multi-channel the services provided under the parent licence and the additional licence allocated under section 38A or 38B (as relevantly applies) may be revoked by the licensee by notice in writing. For the revocation to have effect, the ACMA must approve the revocation. It is intended that, where a broadcaster makes a multi-channelling election, the broadcaster should be able to decide later to withdraw that election if sufficient radiofrequency spectrum is available. However, in such a case the broadcaster would be required to comply with the HDTV quotas applicable during the simulcast period or simulcast-equivalent period in that licence area under clause 37E of Schedule 4 to the BSA. A revocation under subclause 6(5BA) must generally be made by the holder of the licence allocated under section 38A or 38B. However, if the parent licence has been transferred, the revocation must be made by the new licensee for the parent licence. If

60 the section 38A or 38B licence has been transferred, the revocation must be made by the holder of that licence. Item 51A - After clause 7A of Schedule 4 Item 51A of Schedule 2 inserts new clause 7B of Schedule 4, which provides for the revocation of multi-channelling elections. If a licensee gives the ACMA a notice of revocation under new subclause 6(5BA) (see Item 50A) or existing subclause 6(7C), and the ACMA is satisfied that there is sufficient radiofrequency spectrum available, the ACMA must approve the revocation (new subclauses 7B(1) and (2)). The ACMA is also required to vary the relevant digital channel plan under the commercial television conversion scheme to allot a channel to the licensee. This provision ensures that a multi-channelling election can only be revoked if there is sufficient radiofrequency spectrum available for a television channel in the relevant area. If there is spectrum available the ACMA must reserve that spectrum for the broadcaster under the relevant digital channel plan for that licence area. In determining whether there is sufficient spectrum available, any spectrum covered by a determination under subsection 34(3) of the BSA is taken to be unavailable because that spectrum is reserved (e.g. for datacasting services) (new subclause 7B(3)). The ACMA must determine the day on which the revocation takes effect. It is likely that there will be some delay between the issuing of notice to the ACMA of a broadcaster's intention to revoke a multi-channelling election and the commencement of independent transmissions by the broadcaster. After the broadcaster gives notice to the ACMA that they wish to revoke the multi-channelling election, the broadcaster will need to prepare to transmit their services independently, which may involve the purchase and installation of equipment. To ensure that there is no disruption to digital services, where the ACMA approves the revocation it must specify that the multi-channelling election ceases to have effect on a particular day. The specified day will generally be the day on which the broadcaster is expected to commence independent transmission. Until that time, the broadcasting service provided by that licensee would continue to be transmitted on the multi-channel. New subclause 7B(4) provides that the ACMA may vary the day on which the revocation takes effect. If the broadcaster is not ready to commence transmission on the specified date, or is ready early, the ACMA may vary the specification to reflect the date on which transmissions are to commence. In particular, the ACMA may make such a variation at the request of the broadcaster concerned. If the ACMA refuses to approve the revocation, the ACMA must give the licensee notice in writing of the refusal (new subclause 7B(5)). Item 51 - Before subclause 6(8) of Schedule 4 Item 51 of Schedule 2 makes technical amendments consequential to Items 8 and 70 of Schedule 2. Item 52 - Paragraph 8(7)(a) of Schedule 4

61 Item 53 - Paragraph 8(7)(b) of Schedule 4 Item 54 - Subclause 8(8) of Schedule 4 Item 55 - Paragraph 8(10)(b) of Schedule 4 Item 56 - Subclause 8(10A) of Schedule 4 Items 52-56 are consequential to Item 70. Item 58 - After subclause 9(1) of Schedule 4 Item 58 of Schedule 2 makes technical amendments consequential to Items 8 and 70 of Schedule 2, with the result that holders of commercial television broadcasting licences are not required to submit implementation plans to the ACMA in relation to their HDTV multi-channel. Item 59 - After subclause 19(7B) of Schedule 4 Item 59 makes a technical amendment consequential to Item 70 of Schedule 2. Item 60 - After subclause 20(1A) of Schedule 4 Item 60 of Schedule 2 makes technical amendments consequential to Items 8 and 70 of Schedule 2, with the result that national broadcasters are not required to submit implementation plans to the ACMA in relation to their HDTV multi-channel. Item 61 - Paragraph 23(7)(a) of Schedule 4 Item 62 - Paragraph 23(7)(b) of Schedule 4 Item 63 - Subclause 23(8) of Schedule 4 Item 64 - Paragraph 23(10)(b) of Schedule 4 Item 65 - Subclause 23(10A) of Schedule 4 Items 61-65 of Schedule 2 are consequential to Items 66 and 74. Item 66 - After clause 35 of Schedule 4 Item 66 inserts new clause 35AA of Schedule 4. New subclause 35AA(1) requires national broadcasters to provide at least one HDTV multi-channel during the simulcast period. New subclause 35AA(2) provides that where regulations require the transmission of a HDTV multi-channel in a coverage area during a simulcast-equivalent period, the national broadcaster must comply with that requirement. The requirement to provide a HDTV version of the service does not require a national broadcaster to transmit continuously (ie. on a 24 hours a day, seven days a week basis). As with SDTV multi-channels provided by national broadcasters (in accordance clause 5A of Schedule 4 and with the amendments made in Schedule 1),

62 the national broadcaster may choose to transmit the HDTV multi-channel only part of the time. Provide the licensee complies with the HDTV quota obligations in clause 37F of Schedule 4 (see Item 29 below), the hours of transmission are at the discretion of the licensee. Item 67 - Part 4 of Schedule 4 (heading) Item 68 - Division 2 of Part 4 of Schedule 4 (heading) Items 67 and 68 of Schedule 2 are technical amendments consequential to Item 70. Item 69 - Before clause 37E of Schedule 4 Item 69 of Schedule 2 inserts new clause 37DA of Schedule 4. New clause 37DA of Schedule 4 provides that Division 2, which imposes HDTV quotas and standards, does not apply in relation to licences allocated under subsection 40(1). This is appropriate because commercial television broadcasting services provided under subsection 40(1) licences are likely to have a less significant impact on audiences than other commercial television broadcasting services, due to their transmission outside the BSB. They are also not subject to the digital conversion scheme and are not permitted to multi-channel. Thus it is proposed that subsection 40(1) licensees should not be required to comply with HDTV quotas. Item 70 - Subclauses 37E(1), (2), (2A) and (2B) of Schedule 4 Item 70 of Schedule 2 repeals existing subclauses 37E(1), (2), (2A) and (2B) of Schedule 4, which required that regulations be made requiring commercial television broadcasting licensees in non-remote licence areas to: � provide a HDTV version of their service; � transmit a quota of HDTV programs; and � simulcast the HDTV version of the service with the service provided in analogue and digital mode. The regulations made pursuant to clause 37E are in Schedule 1 of the Broadcasting Services (Digital Television Standards) Regulations 2000 (the Regulations). The repeal of the enabling provisions ensures that commercial television broadcasters do not need to comply with Schedule 1 to the Regulations, and that the new HDTV rules in clause 37E apply from 1 January 2007. However, the ongoing obligations in the regulations to keep records in relation to HDTV transmissions and to regularly report to the ACMA continue in force notwithstanding these amendments. Item 70 inserts new subsections 37E(1), (2) and (2A) of Schedule 4 to remove the requirement for the HDTV version of the service to be a simulcast of the SDTV and analogue service. The requirement to transmit a quota of HDTV programs of 1040 hours per year continues. For existing licensees, with the exception of the licensee operating in Mildura/Sunraysia TV1, the HDTV quota must be met from 1 January 2007 until the

63 end of the simulcast period or simulcast-equivalent period. If the simulcast period for a licence area does not end on 31 December of a year, the HDTV quota is reduced on a pro-rata basis for the final calendar year of the simulcast period. For the licensees operating in Mildura/Sunraysia, HDTV quota obligations commence on 1 January 2008 and must be met for the duration of the simulcast period or simulcast-equivalent period. HDTV obligations start on 1 January 2008 for Mildura/Sunraysia, reflecting the later commencement date of this service which is provided under section 38B of the BSA. In the case of any new commercial television broadcasting licences issued after 1 January 2007, the HDTV quota will commence on the day two years following commencement of a service provided under the licence. Item 70 is related to Item 29, which imposes licence conditions on licensees requiring compliance with the HDTV quotas. The effect of these amendments is that commercial television broadcasting licensees are required to provide a HDTV multi-channel, but the programming provided on that HDTV multi-channel may differ from that provided on the core service. Of course, if the broadcaster chose, the licensee could continue to provide a HDTV simulcast. Item 71 - Subclause 37E(3) of Schedule 4 Item 71 of Schedule 2 makes a technical amendment consequential to Item 70. Item 72 - Subclause 37E(4) of Schedule 4 Item 72 of Schedule 2 repeals subclause 37E(4) of Schedule 4, and inserts new subclauses 37E(4) and (5). This amendment is consequential to Item 70. Item 73 - Clause 37EA of Schedule 4 Item 73 of Schedule 2 repeals clause 37EA of Schedule 4. This amendment is consequential to Item 70. Clause 37EA relates to the simulcast requirements for the HDTV version of the service. As Item 70 repeals the simulcast requirements, clause 37EA is no longer required. Item 74 - Subclauses 37F(1), (2), (2A) and (2B) of Schedule 4 Item 74 of Schedule 2 repeals existing subclauses 37F(1), (2), (2A) and (2B) of Schedule 4, which required that regulations be made requiring national television broadcasters in non-remote licence areas to: � provide a HDTV version of their service; � transmit a quota of HDTV programs; and � simulcast the HDTV version of the service with the service provided in analogue and digital mode.

64 The regulations made pursuant to clause 37F are in Schedule 2 of the Regulations (see the notes on Item 70). The repeal of the enabling provisions ensures that national television broadcasters do not need to comply with Schedule 2 to the Regulations, and that the new HDTV rules in clause 37F apply from 1 January 2007. However, the ongoing obligations in the regulations to keep records in relation to HDTV transmissions and to regularly report to the ACMA continue in force notwithstanding these amendments. Item 74 inserts new subsections 37F(1), (2) and (2A) of Schedule 4 to remove the requirement for the HDTV version of the service to be a simulcast of the SDTV and analogue service. The requirement to transmit a quota of HDTV programs of 1040 hours per year continues for the duration of the simulcast period or simulcast- equivalent period. The obligation will apply to the designated HDTV multi- channelled national television broadcasting service. If the simulcast period or simulcast-equivalent period for a licence area does not end on 31 December of a year, the HDTV quota is reduced on a pro-rata basis for the final calendar year of the simulcast period. Item 74 is related to Item 66, which requires national television broadcasters to comply with the HDTV quotas. The effect of these amendments is that national broadcasters are required to provide a single HDTV multi-channel, but the programming provided on that HDTV multi- channel may differ from that provided on the simulcast service. Of course, if the broadcaster chose, the licensee could continue to provide a HDTV simulcast. Further, the national broadcaster may choose to provide additional HDTV multi-channels. Item 75 - Subclause 37F(3) of Schedule 4 Item 76 - Subclause 37F(4) of Schedule 4 Items 75 and 76 of Schedule 2 are consequential to Item 74 of Schedule 2. Item 77 - Clause 37FA of Schedule 4 Item 77 of Schedule 2 repeals clause 37FA of Schedule 4. This amendment is consequential to Item 74. Clause 37FA relates to the simulcast requirements for the HDTV version of the service. As Item 74 repeals the simulcast requirements, clause 37FA is no longer required. Item 78 - Subclauses 37G(1), (1A), (1B) and (1C) of Schedule 4 Item 78 repeals subclauses 37G(1), (1A), (1B) and (1C) of Schedule 4, and inserts new subclause 37G(1). Item 78 makes corresponding amendments in relation to commercial television broadcasters operating in remote licence areas to those amendments made for non-remote areas by Item 70. As currently, while new clause 37E directly imposes obligations on commercial television broadcasters in non-remote licence areas, clause 37G continues to provide that regulations may be made to impose HDTV obligations on commercial television broadcasters operating in remote areas. Thus, unless regulations are made, commercial television broadcasters in remote licence areas are not subject to HDTV

65 quota obligations. However, if quotas are imposed by regulation, there is no requirement on the broadcaster to provide simulcast programming on the HDTV service. Item 79 - Subclause 37G(2) of Schedule 4 Item 79 of Schedule 2 is consequential to Item 78 of Schedule 2. Item 80 - Subclauses 37G(3) and (4) of Schedule 4 Item 80 of Schedule 2 repeals subclauses 37G(3) and (4) of Schedule 4, and substitutes new subclauses 37G(3), (4), (5) and (6) of Schedule 4. These amendments are consequential to Item 78, and they ensure that any obligations imposed under regulations to comply with a HDTV quota cease at the end of the simulcast period (or the simulcast-equivalent period if there is no simulcast period for the licence area). Further, HDTV quota obligations cannot be imposed where there is a multi- channelling election in force. Item 81 - Subclauses 37H(1), (1A), (1B) and (1C) of Schedule 4 Item 81 of Schedule 2 amends clause 37H of Schedule 4 as it applies to national broadcasters in a corresponding way to the amendments made by Item 78 in relation to commercial television broadcasters. Item 82 - Subclause 37H(2) of Schedule 4 Item 83 - Subclause 37H(3) of Schedule 4 Items 82 and 83 of Schedule 2 are consequential to Item 78, and they ensure that any obligations imposed under regulations to comply with a HDTV quota cease at the end of the simulcast period (or the simulcast equivalent period if there is no simulcast period for the coverage area). Item 84 - Clause 37J of Schedule 4 Item 84 repeals clause 37J of Schedule 4 as a consequence of Items 70, 74, 78 and 80. Clause 37J is no longer required as it is not proposed that it be mandatory that multi- channels be provided 24 hours per day, seven days per week. Item 85 - Division 3 of Part 4 of Schedule 4 Item 85 repeals Division 3 of Part 4 of Schedule 4, and inserts a new Division 3. Item 85 of Schedule 2 repeals existing clauses 38 of Schedule 4, which required that regulations be made requiring commercial television broadcasting licensees and national broadcasters to provide captioning services in certain circumstances The regulations made pursuant to clause 38 are in Schedule 3 of the Regulations. The repeal of the enabling provisions ensures that commercial television broadcasters do not need to comply with Schedule 3 to the Regulations, and that the new captioning rules in clause 38 apply from 1 January 2007.

66 New clause 38 requires commercial television broadcasting licensees and national broadcasters to caption: � all television programs transmitted during prime viewing hours; and � news or current affairs programming transmitted outside prime viewing hours (new subclause 38(1)). o Note that "prime viewing hours" are the hours between 6pm and 10.30pm each day (new subclause 38(11)). The requirement to provide captioning under subclause 38(1) is subject to some qualifications. Broadcasters do not need to provide a captioning service where: � the program concerned involves live sport coverage that is subject to unscheduled extended coverage which displaces a news program (new subclauses 38(2) and (3)); � the program is televised on a SDTV or HDTV multi-channel during the simulcast period, unless the program has previously been transmitted on the core/simulcast service (new subclauses 38(4) and (5)); � the program is wholly or partly in a language other than English (new paragraph 38(7)(a)); � the audio component of the program consists of music that has no human vocal content recognisable as English (new paragraph 38(7)(b)); and � the audio component of the program consists of incidental or background music (new paragraph 38(7)(c)). Commercial television broadcasting licensees operating under licences issued under subsection 40(1) do not need to provide captioning services during the first twelve months of commencing the service, or such longer period as is agreed by the ACMA (new subclause 38(6). This concession to subsection 40(1) licensees is seen as appropriate given the more limited audience these services are likely to target and to allow time to solve any technical issue which may arise from making captioning available on a new platform.. Notwithstanding the obligation to provide captioning in accordance with subclause 38(1) and related exemptions, commercial television broadcasting licensees and national broadcasters are required, during the simulcast period or simulcast-equivalent period, to provide a captioning service in relation to programs transmitted on SDTV and HDTV multi-channels where the program has been previously transmitted by the broadcaster concerned with captions (new subclauses 38(9) and (10)). Item 86 - Before clause 41H of Schedule 4 Item 86 of Schedule 2 inserts new clause 41C of Schedule 4.

67 New clause 41C applies to commercial television broadcasters during the simulcast period or simulcast-equivalent period (new subclause 41C(1) of Schedule 4). A commercial television broadcaster must not televise the whole of an anti-siphoning event on a HDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised the whole anti- siphoning event on the core service; or � the commercial television broadcaster will televise the whole anti-siphoning event simultaneously on both the core service and the HDTV multi-channel (new subclause 41C(2) of Schedule 4). Similarly, a commercial television broadcaster must not televise a part of an anti- siphoning event on a HDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised that part of the anti-siphoning event on the core service; � the commercial television broadcaster will televise that part of the anti-siphoning event simultaneously on both the core service and the HDTV multi-channel; or � the commercial television broadcaster televises the part of the anti-siphoning event as part of a news or current affairs program (new subclause 41C(3) of Schedule 4). This is the same restriction that is introduced for national broadcasters by Item 18 of Schedule 1. It is intended that the exception in relation to televising parts of anti-siphoning events in news or current affairs programs will permit commercial television broadcasters to transmit a news or current affairs program with a sports segment on the HDTV multi- channel, and that the sports segment may include televised excerpts from anti- siphoning events. However, this exception would not cover, for example, a sports highlights program which televised significant excerpts from previously un-televised anti-siphoning events, broken only by short commentary segments. Item 87 - After clause 41H of Schedule 4 Item 87 of Schedule 2 inserts new clause 41J of Schedule 4. New clause 41J is the equivalent restriction for national broadcasters televising anti-siphoning events on HDTV multi-channels to new clause 41C for commercial television broadcasters (Item 40). It effectively continues the rule introduced by Item 18 of Schedule 1. Item 88 - At end of Part 8 of Schedule 4 Item 88 of Schedule 2 inserts new clause 60C of Schedule 4. New clause 60C provides that, at least one year before the end of the simulcast period (ie. the earliest end-date) the Minister must cause to be conducted a review of the

68 regulation of SDTV and HDTV multi-channels. More specifically, the review must consider whether and how captioning, Australian content and children's television standards and code of practice should apply to multi-channels (new subclause 60C(1)). The review is timed to allow for any necessary changes to the regulation of multi-channels to be made prior to the end of the simulcast period, when commercial television broadcasters will be authorised to provide unlimited multi-channels (Schedule 3 to the Bill). The Minister must cause a report to be prepared at the conclusion of the review (new subclause 60C(2)). The report must be tabled in Parliament (new subclause 60C(3)). Item 88A - At end of clause 41 of Schedule 6 Item 88A inserts new subclause 41(3) into Part 6 of Schedule 6 of the BSA. New subclause 41(3) excludes a channel B datacasting transmitter licence from the control provisions in subclauses 41(1) and (2) of Part 6, Schedule 6 of the BSA, unless the relevant transmitter is operated for transmitting a datacasting service that is capable of being received by a domestic digital television receiver. This provision is intended to give effect to the Government policy that the prohibition on national broadcasters controlling datacasting transmitter licences in relation to channel B licences be removed, in cases where the service is not capable of being received by a domestic digital television receiver, for example, where the service can be received only by certain mobile television services. The Government considers that where the new services to be provided on channel B licences are not delivered to normal domestic digital television receivers, it is not necessary or desirable to exclude existing free to air broadcasters from controlling the supply of such services. The existing legislated prohibition in the BSA on national broadcasters controlling a datacasting transmitter licence will continue to apply in respect of channel A licences, because services provided using a channel A datacasting transmitter licence must be provided to domestic digital reception equipment. Radiocommunications Act 1992 Item 88B - Section 5 Item 88C - Section 5 Item 88D - Section 5 Item 88E - Section 5 Item 88F - Section 5 Item 88G - Section 5 Item 88H - Section 5 Item 88J - Section 5 Item 88K - Section 5

69 Item 88L - Section 5 Item 88M - Section 5 Items 88B-88M insert a series of definitions into section 5 of the Radcomms Act which are used in later Items. These include a definition of `domestic digital television receiver'. This definition is intended to include television receivers such as integrated digital television sets and set top boxes that are normally located in the home or fixed premises, rather than mobile service reception equipment. In this definition, the reference to a `hand-held device' is intended to mean a device that is primarily designed to be hand-held during use. Item 88N - At the end of Division 1 of Part 3.3 of Chapter 3 Item 88N new sections 98A and 98B into the Radcomms Act. Section 98 of the Radcomms Act enables the ACMA to determine the types of transmitter licences that can be allocated. The new provisions enable the ACMA to declare that certain datacaster transmitter are channel A datacasting transmitter licences and certain other datacasting transmitter licences are channel B datacasting transmitter licences. These new provisions are necessary to enable particular requirements to be attached to channel A datacasting transmitter licences and other requirements to be attached to channel B datacasting transmitter licences. Item 89 - After section 100D Item 89 inserts new section 100E of the RA. The effect of new section 100E is that a transmitter licence authorising the transmission of a national television broadcasting service in digital mode will also authorise the transmission of the HDTV multi-channel provided by the national broadcaster during the simulcast period. Item 90 - Subsection 102(1) Item 90 of Schedule 2 is consequential to Item 16 of Schedule 2. Item 90A - Subsection 102(2D) Item 90B - Subsection 102(2D) Item 90C - Subsection 102(2D) Item 90D - After subsection 102(2E) Item 90E - After subsection 102(2F) Item 90F - Paragraph 102(3)(b)

70 These Items insert new subsections 102(2EA), (2G), (2H) and (2J) of the RA and make other consequential amendments. Where a multi-channelling election is made by a licensee, the licensee will not be issued a transmitter licence for both the digital version of the analogue parent service and the digital additional service under section 38A or 38B (see subsections 102(2A) and 102A(2A) of the RA). As a result, if the multi-channelling election is revoked, the licensee will need an additional transmitter licence which permits the use of an additional 7MHz of spectrum so that the licensee will be able to comply with the HDTV quota requirements and the licensee will be able to provide a single SDTV multi-channel after 1 January 2009. New subsection 102(2G) provides that if a licensee gives the ACMA a notice of revocation of a multi-channelling election under subclause 6(5BA), and the ACMA approves the revocation under clause 7B, the ACMA must issue an additional transmitter licence to the licensee. New subsection 102(2H) of the RA provides that the new transmitter licence issued under new subsection 102(2G) comes into effect on the day on which the revocation takes effect. New subsections 102(2EA) and (2J) of the RA provide that if a related broadcasting licence is transferred, the new transmitter licence is taken to be issued to the person to whom the related licence is transferred. This ensures that where a broadcasting licence under the BSA is transferred, the new licensee will be authorised to transmit the broadcasting service or services concerned under the licence. Item 91 - Subsection 102A(1) Item 91 of Schedule 2 is consequential to Item 16 of Schedule 2. Item 91A - Subsection 102A(2D) Item 91B - Subsection 102A(2D) These Items are consequential to Items 90A-90F. Item 92 - After section 102A Item 92 inserts new section 102AA of the RA. The effect of new 102AA of the RA is that a transmitter licence authorising the transmission of a commercial television broadcasting service in digital mode will also authorise the transmission of the HDTV multi-channel provided by the commercial television broadcaster during the simulcast period (or the simulcast-equivalent period if there is no simulcast period for the licence area). Item 92A - Subsection 103(1) Item 92B - Subsection 103(4) Item 92C - Subsection 103(4A) Item 92D - Paragraphs 103(4A)(a) and (b)

71 Item 92E - After subsection 103(4B) These Items insert new subsections 103(4C), (4D), (4E) and (4F) of the RA and make consequential amendments. The effect of these amendments is that a transmitter licence issued under subsection 102(1), 102(2D), 102(2G), 102A(1) or 102A(2D) continues in force while the related broadcasting licence under the BSA remains in force. However, the transmitter licence does not have effect if the related licence is suspended under section 143 of the BSA. Item 92F - After subsection 106(5) Item 92G - Subsection 106(7) Item 92H - After subsection 106(9) Item 92J - Subsection 106(10) Item 92K - At the end of subsection 106(11) These Items insert new subsections 106(5A) and 106(9A) into the Radcomms Act and make consequential amendments to subsections 106(7), 106(10), 106(11). New subsection 106(5A) requires the ACMA to include specified requirements in a determination regarding a price based allocation system for channel A datacasting transmitter licences. New subsection 106(9A) provides the Minister with a power to direct the ACMA in relation to the exercise of the power conferred by paragraph subsection 106(5A). These provisions are necessary to give effect to the Government policy that the price- based allocation process for channel A datacasting transmitter licences be subject to the pre-conditions, such as the applicant needing to demonstrate the financial capacity and willingness to roll-out and maintain new digital services on a nation-wide basis. Item 92L - Paragraph 109A(1)(g) Item 92M - Paragraph 190A(1)(ga) These Items amend paragraph 109A(1)(g) of the Radcomms Act and insert new paragraph 109A(1)(ga) into the Radcomms Act. The amendment to paragraph 109A(1)(g) excludes channel A and channel B datacasting transmitter licences from the commencement conditions imposed on other datacasting transmitter licences. The former paragraph 109A(1)(ga) imposed requirement relating to continuation of service before 2007. New paragraph 109A(1)(ga) imposes on channel B datacasting transmitter licences a condition that services delivered using such licences must commence within 18 months after the allocation of the licence or as notified in writing by the ACMA.

72 The Government's intention is that commencement and roll-out conditions for channel A datacasting transmitter licences could be imposed by the ACMA by licence condition pursuant to paragraph 109A(1)(k) of the Radcomms Act. New subsection 109A(6) provides the Minister with a power to direct the ACMA in relation to the exercise of the power conferred by paragraph 109A(1)(k), to specify conditions in a channel A datacasting transmitter licence. Item 92N - Paragraph 109A(1)(h) Item 92P - At the end of paragraph 109A(1)(i) Item 92Q - After paragraph 109A(1)(i) These Items repeal paragraph 109A(1)(h) of the BSA and replace it with new paragraphs 109A(ia)-(if). Existing paragraph 109A(1)(h) provides that, prior to 1 January 2007, the services provided using datacasting transmitter licences were restricted to datacasting services provided under a datacasting content licence under Schedule 6 to the BSA. The provisions relating to the range of services which can be provided on datacasting transmitter licences from 1 January 2007 is retained in paragraph 109A(1)(i). New provisions are added to this provision and amendments made to paragraph 109A(1) to specify the types of services that can be provided using datacasting licences on or after 1 January 2007 in relation to channel A and channel B datacasting transmitter licences. These requirements are imposed as licence conditions. For example, new paragraph 109A(1)(i)(iii) provides that a datacasting transmitter licence can be used to deliver a BSA exempt re-transmission service. This means that datacasting transmitter licences in general can be used to re-transmit services which under section 212 of the BSA are exempt from the regulatory regime under the BSA. This provision makes it clear that datacasting transmitter licences can retransmit certain free to air services in prescribed circumstances. New paragraph 109A(1)(ia) specifies the types of services that can be provided on channel A datacasting transmitter licences and new subparagraphs 109A(1)(i)(ib)-(ie) specify the types of services that can be provided on channel B datacasting transmitter licences. New paragraphs 109A(1)(ib)-(ie) give effect to the Government's intention that channel B datacasting transmitter licences be used to provide a wider variety of services, including both free-to-air and subscription mobile services, but that: � commercial and national television broadcasters should not exercise a controlling influence in the provision of in-home services using channel B datacasting transmitter licences; and � channel B datacasting transmitter licenses cannot be used for commercial free to air broadcasting to in-home receivers. New paragraph 109A(1)(ia) provides that it is a condition of a channel A datacasting transmitter licensee that such a transmitter can only be used to transmit a datacasting

73 service that is capable of being received by a domestic digital television receiver, where that datacasting service is provided under, and in accordance with the conditions of a BSA datacasting licence, is an open narrowcasting television service or is a community television broadcasting service. This gives effect to the Government's intention that channel A datacasting transmitter licences be used to provide only certain free-to-air services to domestic digital television receivers. Channel A datacasting transmitter licences cannot be used to deliver new commercial television or radio broadcasting services, subscription television or radio broadcasting services, or retransmitted commercial or national television or radio broadcasting services. New paragraph 109A(1)(ib) provides that it is a condition of a channel B datacasting transmitter licence that such a transmitter cannot be used to transmit a commercial broadcasting service or a subscription television broadcasting service that is capable of being received by a domestic television receiver. New paragraph 109A(1)(ic) provides that a channel B datacasting transmitter licence cannot be used to provide a datacasting service capable of being received by a domestic digital television receiver if the licensee is a commercial television broadcasting licensee, a person who controls such a licensee, a company who is controlled by the controller of such a licensee, a national broadcaster or a company controlled by a national broadcaster. New paragraph 109A(1)(id) provides that a channel B datacasting transmitter licence cannot be used to provide a datacasting service provided under a BSA datacasting licence capable of being received by a domestic digital television receiver if the holder of the BSA datacasting licence is a commercial television broadcasting licensee, a person who controls such a licensee, a company who is controlled by the controller of such a licensee, a national broadcaster or a company controlled by a national broadcaster. New paragraph 109A(1)(ie) provides that a channel B datacasting transmitter licence must not be used to transmit a datacasting service capable of being received by a domestic digital television receiver if the service is a BSA exempt re-transmission service. A BSA exempt re transmission service is a service that does no more than re- transmit programs that are transmitted by a national broadcasting service, commercial broadcasting licensee or a community broadcasting licensee within the licence area of that licence or outside the licence area of that licence with permission from the ACMA. New paragraph 109A(1)(if) gives effect to the Government policy that channel A and channel B datacasting transmitter licences should be used to transmit services in digital mode consistent with the Government's policy that terrestrial television services be converted to digital mode and that the channels be used to provide new digital services. Item 92QA - Before paragraph 109A(1)(j) This Item inserts another licence condition in subsection 109A(1) of the Act (new paragraph 109A(1)(ij)). It will be a condition of a channel B datacasting transmitter licence that the licensee and any third party user authorised by the licensee under

74 section 114 must comply with an access undertaking in force in relation to that licence under new Division 4A of Part 3.3 of the RA (inserted by Item 92UA of Schedule 2). Item 92R - Subsection 109A(1A) This Item makes a consequential amendment to subsection 109A(1A). Item 92S - Subsection 109A(1B) This Item replaces subsection 109A(1B) which is no longer needed with the repeal of paragraph 109A(1)(g). New subsection 109A(1B) provides that for the purposes of the services that cannot be provided under a channel B datacasting transmitter licence, it is immaterial whether a domestic digital television receiver is capable of receiving subscription television broadcasting services when used in isolation or in conjunction with any other equipment. This new subsection makes it clear that in relation to a subscription television service, a service is taken to be capable of being received by a normal domestic digital television receiver even if additional equipment, such as a conditional access system or subscription television set top box, is needed to receive that service. This is intended to ensure that in-home subscription television services cannot be provided on channel A or channel B datacasting transmitter licences. This Item also inserts new subsections 109A(1C), (1D) and (1E). New subsection 109A(1C) provides that a condition specified in a licence under paragraph 109A(1)(k) may deal with the commencement or continuity of transmission of datacasting services. This provision makes it clear that the ACMA may impose commencement or rollout conditions under paragraph 109A(1)(k). New subsection 109A(1D) provides that subsection (1C) does not limit paragraph 109(1)(k). New subsection 109A(1E) provides that paragraphs 109A(1)(g) and (ga) do not limit subsection 109A(1C). Paragraphs 109A(1)(g) and 109A(1)(ga) impose licence conditions relating to commencement of operation. Item 92T - Subsection 109A(4) This Item makes an amendment to subsection 109A(4) as a consequence of Item 92Q. Item 92U - At the end of section 109A This Item inserts new subsection 109A(5) to provide that subsection 109A(2) and 109A(3), which relate to the constitutions of companies and are relevant to the control provisions in Part 5 of the BSA, do not apply to channel B licensees unless they are transmitting services capable of being received by a domestic digital television receiver. This Item also inserts new subsection 109A(6) which empowers the Minister to give a direction to the ACMA about the imposition of licence conditions under paragraph 109A(1)(k) in relation to channel A datacasting transmitter licences. This provision would, for example, enable the Minister to give a direction to ACMA about the nature of a rollout condition which might be imposed under paragraph 109A(1)(k).

75 Item 92UA - After division 4 of Part 3.3 of Chapter 3 This Item inserts new Division 4A of Part 3.3 of the RA. Division 4A will deal with access to channel B datacasting transmitter licences. It contains provisions that describe the essential features of access undertakings (proposed sections 118A, 118B, 118E, 118J and 118M), the process and criteria for acceptance or rejection of an access undertaking by the ACCC (proposed sections 118C, 118D, 118H, and 118L), the variation of an access undertaking that is in force (proposed sections 118F, 118G and 118H) and the rights to enforce access undertakings in the Federal Court (proposed section 118K). An access undertaking will establish the basis under which a person will be able to obtain access to services that enable or facilitate the transmission of content services under a channel B datacasting transmitter licence (see new sections 118A and 118B). New section 118A defines access for the purposes of new Division 4A, to mean access to services that enable or facilitate the transmission of one or more content services under the channel B datacasting transmitter licence for the purpose of enabling one or more content service providers to provide one or more content services. � For these purposes, a content service is a service of a kind authorised under the Broadcasting Services Act 1992 (BSA) that the holder of a channel B datacasting transmitter licence will be able to provide under the conditions of that licence (see new section 118M). A content service provider is a company that provides, or proposes to provide such a content service (new section 118M). � The concept of access here does not necessarily require that the holder of the relevant BSA licence or person who provides a service under a BSA class licence enter into a direct relationship with the holder of the licence. It would be possible for access to be provided by the holder of the licence to a broker or aggregator of content services, who in turn had commercial arrangements with other entities that provided the relevant service for the purposes of the BSA. New section 118B provides that a person is not eligible to apply for a channel B datacasting transmitter licence unless that person has submitted an access undertaking to the ACCC and the ACCC has accepted it. The access undertaking is an undertaking that any holder of the licence and any person authorised to operate the licence will comply with the access obligations provided for in the undertaking. This access must be provided either on terms and conditions which are agreed or, if there is no agreement, as provided for by the access undertaking. These provisions are not intended to preclude an applicant from submitting a relatively simple undertaking. For example, one means by which access might be provided would be for the licence holder to auction off rights to a specified proportion of the transmission capacity. Content services making use of that capacity would be supplied to the transmitter operator to be broadcast with the other services supplied using that transmitter.

76 The ACCC is able to make a legislative instrument that sets out rules about its practice and procedure under new Division 4A (see new section 118L). These rules, known as Procedural Rules, will enable the ACCC to determine an administration fee which would need to accompany an undertaking given to the ACCC (see new subsection 118B(3)). The Procedural Rules can also impose time limits for giving an undertaking to the ACCC (new subsection 118B(5)). New section 118C provides for the ACCC to request the applicant to provide further information about the undertaking. The ACCC may refuse to consider the undertaking until the information is provided. Information obtained under this section will be subject to the same confidentiality provisions that apply to information obtained by the ACCC under Part XIB or XIC of the Trade Practices Act 1974. New section 118D provides that the ACCC may accept or reject an undertaking. This decision will be governed by any criteria made by the ACCC by legislative instrument under new section 118H. If the ACCC decides to reject an undertaking, it will be able to specify an altered version of the undertaking that it would be prepared to accept (new subsection 118D(3)). New section 118E specifies period that an undertaking remains in force. An undertaking comes into force when the licence to which it relates is issued. It continues in force while the licence is in force, although it is suspended for any period that the licence itself is suspended (new subsection 118E(1)). Where a licence is renewed under section 130, the undertaking continues to apply to the renewed licence in the same way that it applied to the original licence (new subsection 118E(3)). An undertaking also continues in effect in the same way if the licence is transferred to another person (new subsection 118E(2)). New section 118F provides that the ACCC may accept or reject a variation of an undertaking proposed by a licensee. The decision will be governed by any criteria made by the ACCC by legislative instrument under new section 118H. If the ACCC decides to reject a variation, it will be able to specify an altered version of the variation that it would be prepared to accept (new subsection 118F(4)). New section 118G provides for the ACCC to request the applicant to provide further information about the proposed variation. The ACCC may refuse to consider the variation until the information is provided. Information obtained under this section will be subject to the same confidentiality provisions that apply to information obtained by the ACCC under Part XIB or XIC of the Trade Practices Act 1974. New section 118H provides for the ACCC to determine, by legislative instrument, criteria that it must apply in its decisions whether or not to accept an access undertaking or a variation of an access undertaking. New section 118J requires the ACCC to keep a register of all access undertakings that are in force. This includes any undertaking currently varied under section 118F. New section 118K relates to the enforcement of access undertakings. It enables the ACCC or any person whose interests are affected by an access undertaking in force to apply to the Federal Court for orders against a person who has breached the access undertaking. The orders that the Court may make where it finds that a person has

77 breached the access undertaking include orders to comply with the undertaking and to pay compensation (new subsection 118K(3)). New section 118M contains definitions of terms used in new Division 4A. Note that a content service is defined as a service covered by covered by subparagraph 109A(1)(i)(i) or (ii), but does not include a service covered by subparagraph 109A(1)(ib)(i) or (ii). � The services covered by subparagraph 109A(1)(i) are any service provided under BSA datacasting or broadcasting licence allocated under the BSA authorising the provision of that service (subparagraph 109A(1)(i)(i)) or any service provided in accordance with a class licence under the BSA (subparagraph 109A(1)(i)(ii)). These are the services that, in general, may be provided from 1 January 2007 using a datacasting transmitter licence issued under the Act. � However, in the case of a channel B datacasting transmitter licence, it will be a condition of the licence that the transmitter may not be operated to provide (i) a commercial broadcasting service or (ii) a subscription television broadcasting service that is capable of being received by a domestic digital television receiver (new subparagraphs 109A(1)(ib)(i) and (ii), inserted by Item 92Q of Schedule 2). The effect of this is that a content service will be a service belonging to one of the categories of broadcasting services under the BSA (see BSA section 11), or a datacasting service provided under a BSA datacasting licence, that the holder of a channel B datacasting transmitter licence will be able to provide in accordance with section 109A(1) of the Act. Item 92V - Paragraph 125(1)(a) This Item amends section 125 as a consequence of Items 92W and 92X. Item 92VA - Paragraph 125(1)(a) This Item amends paragraph 125(1)(a) of the Act to include a reference to the licence condition to be inserted into subsection 109A(1) by Item 92QA. Section 125 makes provision in connection with the suspension or cancellation of apparatus licences for breaches of licence conditions other than certain licence conditions that apply only to datacasting transmitter licences. As the new licence condition (new paragraph 109A(1)(ij)) relates to a particular kind of datacasting transmitter licence, this amendment adds it to the list of licence conditions to which section 125 does not apply. Item 92W - Subsection 128C(1) This Item amends section 128C as a consequence of Item 92W. ACMA will have power to suspend a datacasting transmitter licence for breach of any of the conditions in new paragraphs 109A(1)(ia)-(if). Item 92WA - Subsection 128C(1)

78 This Item amends section 128C to include a reference to the licence condition to be inserted into subsection 109A(1) by Item 92QA. Section 128C relates to the suspension of datacasting transmitter licences for breach of one of the conditions specific to such licences. As the new licence condition (new paragraph 109A(1)(ij)) relates to a particular kind of datacasting transmitter licence, this amendment adds it to the list of licence conditions to which this section applies. Item 92X - Section 128D This Item amends section 128D as a consequence of Item 92W. ACMA will have power to cancel a datacasting transmitter licence for breach of any of the conditions in new paragraphs 109A(1)(ia)-(if). Item 92XA - Section 128D This Item amends section 128D to include a reference to the licence condition to be inserted into subsection 109A(1) by Item 92QA. Section 128D relates to the cancellation of datacasting transmitter licences for breach of one of the conditions specific to such licences. As the new licence condition (new paragraph 109A(1)(ij)) relates to a particular kind of datacasting transmitter licence, this amendment adds it to the list of licence conditions to which this section applies. Item 92Y - Section 128E This Item repeals section 128E as a consequence of Item 92N. Part 2 - Transitional provisions Item 93 - Determinations under subsection 36(1) of the Broadcasting Services Act 1992 Item 93 of Schedule 2 is a transitional provision that provides that any existing determinations in force under subsection 36(1) of the BSA, which deals with the price-based allocation of commercial television and commercial radio licences, continue to have effect, notwithstanding the amendments made in Schedule 2 to subsection 36(1) (Item 9 of Schedule 2). Item 93A - Approval of revocation of multi-channelling election etc. Item 93B - Variation of the day on which a revocation of a multi- channelling election takes effect New Items 93A and 93B of Schedule 2 to the Bill are required as a consequence of Items 50A-50D and 51A of Schedule 2. By inserting new subclause 7B of Schedule 4 to the BSA, which provides for the revocation of a multi-channelling election where a notice is given by the licensee under subclause 6(5BA) or 6(7C) of Schedule 4, it was necessary to repeal subclauses 6(7D) and (7E), which dealt with revocations in relation to notices given by licensees under subclause 6(7C). New Item 93A provides that a notice given by ACMA under subclause 6(7D) of Schedule 4 to the BSA continues to have effect, notwithstanding the repeal of that

79 subclause. Such a notice has effect as if it had been given under subclause 7B(2) of Schedule 4. New Item 93B makes similar provision for the continuing effect of a notice given by ACMA under subclause 6(7E). Item 93C - Variation of program standards Item 93D - Variation of commercial television conversion scheme Item 93E - Variation of national television conversion scheme As a result of the changes to be made to the BSA by the measures in the Bill (as amended), the ACMA will need to amend: � program standards (notably the standards in relation to Australian content and children's programming); � the commercial television conversion scheme; and � the national television conversion scheme; to reflect the changes to the regulatory regime. Items 93C, 93D and 93E of Schedule 2 to the Bill provide that where the ACMA varies program standards, the commercial television conversion scheme or the national television conversion scheme within 30 days of the commencement of Schedule 2 to the Bill (on 1 January 2007), the ACMA will not need to consult widely before making the variation. Section 126 of the BSA (in relation to program standards), clause 18 of Schedule 4 to the BSA (in relation to the commercial television conversion scheme), clause 33 of Schedule 4 of the BSA (in relation to the national television conversion scheme), and section 17 of the Legislative Instruments Act 2003 (LIA), all of which deal with consultation requirements, will not apply to a variation in these circumstances. In such cases, it will be sufficient for the ACMA to make a copy of the proposed variation publicly available on its website for at least 5 business days. The reason for limiting the consultation period in relation to these instruments is to ensure that the ACMA can implement the necessary changes as soon as possible after the commencement of Schedule 2 to the Bill. Importantly, these truncated consultation requirements will apply only to variations made by the ACMA which relate to transitional or consequential matters associated with the Bill. The ACMA will have limited discretion regarding the scope of the variation in these cases, and as such, a lengthy public consultation period is unnecessary. Item 94 - Transmitter licences issued under section 102 of the Radiocommunications Act 1992 Item 95 - Transmitter licences issued under section 102A of the Radiocommunications Act 1992

80 Items 94 and 95 of Schedule 2 are transitional provisions that clarify that the amendments made in Schedule 2 do not affect the continuity of transmitter licences issued under sections 102 and 102A of the RA before 1 January 2007 (when Schedule 2 commences).

81 SCHEDULE 2A - AMENDMENTS COMMENCING ON PROCLAMATION There is a range of legislative provisions which currently regulate aspects of technical standards and codes of practice. However, these provisions are not all-encompassing and do not readily allow the ACMA to address emerging issues where technical developments or deployments of new technologies may have adverse impacts on consumers or competition. Schedule 2A repeals a range of specific standards-making powers and provides more general powers for the ACMA to determine standards. The Government's intention is that new digital services will drive digital take-up, and that the new Part 9A and Part 9B provisions will ensure that new, domestic services are available to the widest possible audience. The ability for the ACMA to set technical standards for digital television broadcasting and datacasting services will assist in minimising the impact on consumers of the transition to new types of services and equipment. Examples of areas where standards-setting powers may assist include in relation to standards for compression of digital transmissions; and minimum transmissions standards for in-home digital television services (such as that already regulated for in relation to the audio component of standard definition). The standards-making powers will also give the ACMA the ability to address any issues which might arise in relation to standards being used by new services which can be provided using channel B datacasting licences, such as mobile television services, if necessary. Part 1 - Amendments Broadcasting Services Act 1992 Item 1 - After Part 9 New Parts 9A and 9B of the BSA New Parts 9A and 9B of the BSA provide the ACMA with more general standards making powers under which the ACMA will be able to address emerging technical issues. New Part 9A New Part 9A adds new sections 130A and 130B into the BSA. New section 130A gives ACMA the power to determine, by legislative instrument, technical standards relating to the transmission of digital television broadcasting services in the broadcasting services bands of spectrum (BSB) and datacasting services. New section 130B gives ACMA the power to determine, by legislative instrument, technical standards for receivers for use in reception of digital television services using the BSB and in reception of datacasting services. In relation to equipment suppliers, in the absence of licence condition provisions and consistent with other standards compliance provisions, compliance with section 130B will be enforced through offence and civil penalty provisions (see new subsections 130B(2) and 130B(3)). New Part 9B

82 New Part 9B gives ACMA the power to register industry codes, to require industry groups to develop and register with ACMA codes of practice which could deal with such matters as Electronic Program Guides (EPGs), channel numbering and other relevant matters determined by ACMA, together with a power to determine standards where such codes are not developed or not developed to the satisfaction of ACMA. The inclusion of importers, manufacturers and suppliers of television receivers in the industry groups covered by the provisions relating to codes and standards (see new paragraph 130F(g) of the BSA) will enable codes to be developed if codes (or resultant industry standards) are needed in relation to equipment as well as transmission to achieve the desired result for consumers, in relation to such matters as EPGs and channel numbering. Industry standards under Part 9B will be enforceable under new section 130V, which makes non-compliance with industry standards an offence and subject to a civil penalty. Section 130V applies to a person who is a participant in the particular section of the industry to which the relevant industry standard applies (see new sections 130V and 130G). The ACMA will be required to maintain a register of industry codes and industry standards (see new section 130ZA). New section 130L provides for the resolution of conflicts which might occur if industry codes and standards overlap. Item 2 - After paragraph 7(1)(b) of Schedule 2 Item 3 - Paragraph 7(1)(n) of Schedule 2 Item 4 - Paragraph 7(1)(oa) of Schedule 2 Item 5 - Subclauses 7(2B), (2C), (2D) and (2E) of Schedule 2 Item 6 - After paragraph 9(1)(c) of Schedule 2 Item 7 - After paragraph 10(1)(b) of Schedule 2 Item 8 - After paragraph 11(1)(b) of Schedule 2 These Items make compliance with industry standards under Part 9A or Part 9B a licence condition for broadcasters and datacasters. They also make amendments consequential on the repeal of existing standards provisions by Items 17-21 and 27. Item 9 - Clause 2 of Schedule 4 Item 10 - Clause 2 of Schedule 4 Item 11 - Clause 2 of Schedule 4 Item 12 - Clause 2 of Schedule 4

83 These Items add new definitions to clause 2 of Schedule 4 to the BSA that are used in Items 13-16. Item 13 - Subparagraphs 8(7)(a)(ii) and (iii) of Schedule 4 Item 14 - Paragraphs 8(10(c) and (d) of Schedule 4 Item 15 - Subparagraphs 23(7)(a)(ii) and (iii) of Schedule 4 Item 16 - Paragraphs 23(10)(c) and (d) of Schedule 4 These Items amend provisions in Schedule 4 to the BSA as a consequence of the replacement of existing standards provisions (see Items 17-21 and 27) with new Part 9A and Part 9B. Item 17 - Clause 35A of Schedule 4 Item 18 - Part 3A of Schedule 4 Item 19 - Division 1 of Part 1 of Schedule 4 Item 20 - Division 4 of Part 4 of Schedule 4 Item 21 - Division 1A of Part 3 of Schedule 6 These Items repeal existing provisions in the BSA relating to technical standards for transmission of broadcasting services, datacasting services and receivers for use in reception of digital television services, including: � clause 35A of Schedule 4 to the BSA (relating to electronic program guides); � Division 1 of Part 4 of Schedule 4 to the BSA (digital television format Standards); � Division 4 of Part 4 of Schedule 4 to the BSA (technical standards); � Part 3A of Schedule 4 of the BSA (accessibility of domestic reception equipment); and � Division 1A of Part 3 of Schedule 6 to the BSA (relating to electronic program guides). Division 1 of Part 4 of Schedule 4 to the BSA provides for regulations to determine digital television format standards, and Division 4 of Part 4 of Schedule 4 to the BSA provides for regulations to determine technical standards related to the transmission of commercial and national broadcasting services in digital mode, which were to be followed by the ACMA in formulating or varying the commercial television conversion scheme or the national television conversion scheme. Item 22 - Paragraph 24(1)(ca) of Schedule 6 Item 23 - Paragraph 24(1)(g) of Schedule 6

84 Item 24 - Paragraph 46(e) of Schedule 6 Item 25 - Paragraph 52(1)(c) of Schedule 6 Item 26 - Subclauses 54(2) and (3) of Schedule 6 These Items amend provisions in Schedule 6 to the BSA as a consequence of the replacement of existing standards provisions (see Items 17-21 and 27) with new Part 9A and Part 9B. Item 27 - Part 10 of Schedule 6 This Item repeals Part 10 of Schedule 6 of the BSA (datacasting technical standards). Part 10 of Schedule 6 to the BSA provides for regulations to determine technical standards in relation to datacasting services to be observed by datacasting content licensees and datacasting transmitter licensees. Radiocommunications Act 1992 Item 28 - Paragraph 109A(1)(fa) Item 29 - After paragraph 109A(1)(ga) These Items amend section 109A to make compliance with industry standards under Part 9A or Part 9B a condition of datacasting transmitter licences. They also make amendments consequential on the repeal of existing standards provisions by Items 17- 21 and 27.

85 SCHEDULE 3 - AMENDMENTS COMMENCING ON 1 JANUARY 2009 Schedule 3 to the Bill makes a series of amendments to the Broadcasting Services Act 1992 (BSA) and the Radiocommunications Act 1992 (RA) in order to: � permit commercial television broadcasting licensees to provide a single standard definition television (SDTV) multi-channel from 1 January 2009; and � permit commercial television broadcasting licensees to multi-channel freely (in SDTV digital mode, high-definition television (HDTV) digital mode, or a combination of both) from the end of the simulcast period. The current regulatory regime for digital television prevents commercial television broadcasters from providing any digital services which are not a simulcast of their analogue services. It does this by: � establishing a simulcast period during which a commercial television licensee is required to transmit the service concerned in both analogue mode and SDTV digital mode (paragraph 6(3)(c) of Schedule 4 of the BSA); � prohibiting the licensee from broadcasting a program in SDTV mode unless that program is transmitted simultaneously on the analogue and SDTV version of the service (paragraph 7(1)(m) of Schedule 2); and � the conditions of the transmitter licence under the RA (subsections 102(1) and 102A(1)). The end of the simulcast period for non-remote licence areas is provided for in paragraph 6(1)(c) of Schedule 4 of the BSA. For metropolitan licence areas the simulcast period will end on 31 December 2008, and for other licence areas the simulcast periods vary (the current dates for regional areas are either 31 March 2011 or 31 December 2011, depending on the area). It is anticipated that regulations will be made under subparagraph 6(1)(c)(ii) of Schedule 4 to extend the simulcast period. For remote licence areas, a simulcast period may be determined by the Australian Communications and Media Authority (the ACMA) under the commercial television conversion scheme. The ACMA has not yet determined simulcast periods for remote licence areas. Schedule 3 to the Bill will ensure that the regulatory restrictions on the number of multi-channels provided by commercial free-to-air (FTA) television broadcasters are removed at the end of the simulcast period. That is, when the simulcast period ends, commercial television broadcasters will be able to use their radiocommunications transmitter licence under which their analogue service was provided to provide non- simulcast digital services beyond the limited range currently permitted under the BSA and the RA. This will allow commercial television broadcasters to use their commercial broadcasting licences and radiocommunications transmitter licences to provide the same range of service types as national broadcasters from digital switchover. The current arrangements whereby the ACMA can determine which spectrum the broadcaster can continue to use will be retained.

86 To encourage the provision of additional television services that will assist in driving digital take-up, Schedule 3 to the Bill will also allow, from 1 January 2009, commercial FTA television broadcasters to provide a single multi-channel in SDTV digital mode, in addition to the SDTV simulcast of the analogue service. The SDTV multi-channel will be subject to the restriction that the whole or part of anti-siphoning events cannot be premiered on the multi-channel. This requirement is equivalent to the restriction under Schedule 2 to the bill against premiering anti- siphoning events on HDTV multi-channels. Schedule 3 also provides a statutory review of the anti-siphoning scheme prior to 31 December 2009. This review is timed to occur prior to the expiration of the current anti-siphoning list on 31 December 2010 and in the context of digital switchover. This review would include consideration of the restrictions on commercial and national broadcasters televising events on the anti-siphoning list on new digital multi- channels. Broadcasting Services Act 1992 Item 1 - Subsection 6(1) (paragraph (b) of the definition of commercial television broadcasting licence) Item 1 of Schedule 3 makes a technical amendment consequential to Item 3 of Schedule 3. Item 2 - After subsection 18(1A) Item 2 of Schedule 3 inserts new subsection 18(1AA), which clarifies that a SDTV multi-channelled commercial television broadcasting service is not an open narrowcasting service. This new provision is equivalent to existing subsection 18(2), which relates to SDTV multi-channels provided by national broadcasters. Item 2A - After subsection 26A(1) Item 2B - Subsection 26A(2) Item 2C - Subsection 26A(3) These Items insert new subsection 26A(1A) of the BSA and make consequential amendments. New subsections 26A(1) and (2) of the BSA (inserted by Item 6A of Schedule 2) provide that, for the duration of the simulcast period or simulcast-equivalent period (as the case may be), LAPs are not required to deal with HDTV multi-channelled commercial television broadcasting services where the relevant commercial television broadcasting licence was in force immediately before 1 January 2007. New subsection 26A(1A) similarly provides that, for the duration of the simulcast period or simulcast-equivalent period (as the case may be), LAPs are not required to deal with SDTV multi-channelled commercial television broadcasting services where the relevant commercial television broadcasting licence was in force immediately before 1 January 2007.

87 It is considered unnecessary to include SDTV or HDTV multi-channels in LAPs because the radiofrequency spectrum that will be used by the incumbent commercial broadcasters to provide multi-channels has already been allocated and planned by the ACMA. LAPs will need to include SDTV and HDTV multi-channels where a new commercial television broadcasting licence is issued during the simulcast period or simulcast- equivalent period. Further, after the end of the simulcast period or simulcast- equivalent period (as the case may be), all services provided by commercial television broadcasters and national broadcasters will need to be planned, including multi- channels. Item 2D - Paragraph 38B(21A)(c) Item 2E - Subsection 38B(21B) These Items make technical amendments to paragraph 38B(21A)(c) and subsection 38B(21B) of the BSA to ensure that licensees operating under commercial television broadcasting licences allocated under section 38B are subject to a licence condition which requires the provision of at least one service under each of the licences (ie. both the parent licence and the additional 38B licence). This licence condition applies under each of the licences. Item 3 - After section 41A Item 3 of Schedule 3 inserts new sections 41B and 41C of the BSA. New section 41B provides that, during the simulcast period, an existing commercial television broadcasting licence will authorise the licensee to provide: � the core service, which is either simulcast in analogue and digital mode in accordance with Schedule 4 of the BSA or is the initial SDTV service provided by a licensee allocated a licence after 1 January 2007; � a HDTV multi-channel; and � a SDTV multi-channel (new subsection 41B(1)). In relation to new commercial television broadcasting licences issued after 1 January 2009, which will be digital-only licences, the licence authorises the transmission of: � two SDTV multi-channels; and � a HDTV multi-channel (new subsection 41B(2)). Any new commercial television broadcasting licences issued after 2009 required to be digital only licences and therefore will not have simulcast obligations (and a `core' channel) (see new subsection 35B(4) of the BSA, inserted by Item 8 of Schedule 2). Allowing new licensees to provide two SDTV and one HDTV multi-channels will equate to allowing a core SDTV channel, an SDTV multi-channel and a HDTV multi- channel. One of the SDTV multi-channels will be designated as a `primary' multi-

88 channel, which will be permitted to premiere anti-siphoning content (like a core channel). New section 41C provides that, after the simulcast period, both existing and new commercial television broadcasting licences will authorise the licensee to provide: � one or more HDTV multi-channels; and � one or more SDTV multi-channel (new subsections 41C(1) and (2)). Thus, new section 41C ensures that the only limitation on the number of multi- channels that may be provided from the end of the simulcast period is the capacity of spectrum. The broadcaster will still only be authorised to use a single 7MHz of spectrum to provide their services (the frequency channel specified in their transmitter licence under the RA). New sections 41B and 41C do not apply in relation to licences issued under subsection 40(1) (new subsection 41B(3) and 41C(3)). Licences issued under subsection 40(1) are allocated on the basis of one service per licence (Item 4D of Schedule 2). Item 4 - After section 115 Item 4 of Schedule 3 inserts new section 115A of the BSA. New section 115A requires the Minister for Communications, Information Technology and the Arts (the Minister) to cause a review of the ongoing rationale for and operation of the anti-siphoning regime to be conducted before 31 December 2009. The review is timed to occur prior to the expiration of the current anti-siphoning list on 31 December 2010 and in the context of digital switchover. The review is required to include consideration of the restrictions on commercial and national broadcasters televising events on the anti-siphoning list on new digital multi-channels (New Part 4A of Schedule 4). Once the review is complete, a report must be prepared and the Minister is required to table the report in Parliament within 15 sitting days of completion of the report (new subsections 115A(2) and (3)). Item 5 - Paragraph 7(1)(m) of Schedule 2 Item 5 of Schedule 3 is consequential to Item 3 of Schedule 3. Item 6 - Paragraph 7(1)(ob) of Schedule 2 Item 6 makes a technical amendment consequential to Item 14 of Schedule 3. Item 6A - Paragraph 7(1)(p) of Schedule 2 Item 6A makes a technical amendment consequential to Item 16C of Schedule 3. Item 7 - Clause 2 of Schedule 4

89 Item 8 - Clause 2 of Schedule 4 Items 7 and 8 of Schedule 3 insert new definitions of "primary commercial television broadcasting service" and "primary national television broadcasting service". These Items are consequential to Items 14, 15 and 16 of Schedule 3. Item 9 - Clause 2 of Schedule 4 Item 9 of Schedule 3 is consequential to Item 10 of Schedule 3. Item 10 - After clause 5 of Schedule 4 Item 10 inserts new clause 5A of Schedule 4. New clause 5A defines the phrase "SDTV multi-channelled commercial television broadcasting service". This amendment is consequential to Item 3. Item 11 - After subclause 6(7J) of Schedule 4 Item 11 of Schedule 3 makes a technical amendment consequential to Item 3. Item 12 - After subclause 9(1A) of Schedule 4 Item 12 of Schedule 3 inserts new subclause 9(1AA) of Schedule 4, which provides that holders of commercial television broadcasting licences are not required to submit implementation plans to the ACMA in relation to a SDTV multi-channel. Item 13 - After subclause 38(4) Item 13 of Schedule 3 inserts new subclause 38(4A) of Schedule 4 to the BSA. New subclause 38(4A) of Schedule 4 inserts an exemption from captioning requirements for certain commercial television broadcasting licensees, ie those operating under licences issued after 1 January 2009 and providing HDTV and SDTV multi-channels during the simulcast period (unless the programming has previously been transmitted on the licensee's primary commercial television broadcasting service). This exemption is equivalent to the rule in subclause 38(4) for licensees who provide a core service (see Item 85 of Schedule 2). Item 14 - Before clause 41C of Schedule 4 Item 14 inserts new clauses 41A and 41B of Schedule 4 to the BSA. New clause 41A applies to commercial television broadcasters during the simulcast period or simulcast-equivalent period where the broadcaster provides either a simulcast SDTV and analogue service or a single SDTV multi-channel (the core service) (new subclause 41A(1) of Schedule 4). A commercial television broadcaster must not televise the whole of an anti-siphoning event on a SDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised the whole anti- siphoning event on the core service; or

90 � the commercial television broadcaster will televise the whole anti-siphoning event simultaneously on both the core service and the SDTV multi-channel (new subclause 41A(2) of Schedule 4). Similarly, a commercial television broadcaster must not televise a part of an anti- siphoning event on a SDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised that part of the anti-siphoning event on the core service; � the commercial television broadcaster will televise that part of the anti-siphoning event simultaneously on both the core service and the SDTV multi-channel; or � the commercial television broadcaster televises the part of the anti-siphoning event as part of a news or current affairs program (new subclause 41A(3) of Schedule 4). It is intended that the exception in relation to televising parts of anti-siphoning events in news or current affairs programs will permit commercial television broadcasters to transmit a news and current affairs program with a sports segment on the SDTV multi-channel, and that the sports segment may include televised excerpts from anti- siphoning events. However, this exception would not cover, for example, a sports highlights program which televised significant excerpts from previously un-televised anti-siphoning events, broken only by short commentary segments. New clause 41B of Schedule 4 applies during the simulcast period or simulcast- equivalent period where the broadcaster does not provide a core service. For new licences allocated after 1 January 2009, the licensee may provide two SDTV multi- channels. As a consequence, the broadcaster will not have a core service. Rather, the ACMA will designate one of the SDTV multi-channels as the primary service provided by the broadcaster (Item 15, new clause 41G of Schedule 4). New clause 41B provides that a commercial television broadcaster must not televise the whole of an anti-siphoning event on a secondary SDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised the anti-siphoning event on the primary service; or � the commercial television broadcaster will televise the anti-siphoning event simultaneously on both the primary service and the secondary SDTV multi- channel (new subclause 41B(2) of Schedule 4). Similarly, a commercial television broadcaster must not televise a part of an anti- siphoning event on a secondary SDTV multi-channelled commercial television broadcasting service unless: � the commercial television broadcaster has previously televised that part of the anti-siphoning event on the primary service;

91 � the commercial television broadcaster will televise that part of the anti-siphoning event simultaneously on both the primary service and the secondary SDTV multi- channel; or � the commercial television broadcaster televises the part of the anti-siphoning event as part of a news or current affairs program (new subclause 41B(3) of Schedule 4). Item 15 - After clause 41C of Schedule 4 Item 15 of Schedule 3 inserts new clauses 41D, 41E, 41F, and 41G of Schedule 4. New clause 41D imposes an equivalent rule in relation to the HDTV multi-channel provided by a commercial television broadcasting licensee to the rule in new clause 41B (Item 14). New clause 41E imposes an equivalent rule in relation to the provision of SDTV multi-channels by commercial television broadcasting licensees after the end of the simulcast period (or simulcast-equivalent period) to the rule in new clauses 41B and 41D. New clause 41F imposes an equivalent rule in relation to the provision of HDTV multi-channels by commercial television broadcasting licensees after the end of the simulcast period (or simulcast-equivalent period) to the rule in new clause 41E. New clause 41G provides that the ACMA may, by legislative instrument, determine which SDTV multi-channel provided by a commercial television broadcasting licensee is the primary service for the purposes of the anti-siphoning restrictions. Item 16 - After clause 41J of Schedule 4 Item 16 of Schedule 3 inserts new clauses 41K, 41L, and 41M of Schedule 4 to the BSA. New clause 41K imposes an equivalent restriction on the televising by national broadcasters of events on the anti-siphoning list on SDTV multi-channels after the end of the simulcast period (or simulcast-equivalent period) to the restriction on commercial television broadcasters in new clause 41E (Item 15 of Schedule 3). Anti- siphoning events must be broadcast first on the "primary national television broadcasting service" (see new clause 41M). New clause 41L imposes an equivalent restriction on the televising by national broadcasters of events on the anti-siphoning list on HDTV multi-channels after the end of the simulcast period (or simulcast-equivalent period) to the restriction on commercial television broadcasters in new clause 41F (Item 15 of Schedule 3). Anti- siphoning events must be broadcast first on the "primary national television broadcasting service" (see new clause 41M). New clause 41M provides that national broadcasters must give the Minister a notice in writing declaring which SDTV multi-channel provided by the broadcaster is the primary service for a coverage area (new clause 41M(1)). National broadcasters are

92 obliged to ensure that a notice is in force at all times after the end of the simulcast period for a coverage area (new clause 41M(2)). Radiocommunications Act 1992 Item 16A - Section 5 (paragraph (a) of the definition of datacasting transmitter licence) Item 16B - Subsection 100B(1) These Items are consequential to Item 16C. Item 16C - After section 101A Item 16C inserts new sections 101B and 101C of the RA. New section 101B of the RA applies only in relation to remote licence areas in which an additional commercial television broadcasting licence has been issued by the ACMA under section 38B of the BSA. New subsection 101B(1) of the RA provides that if a commercial television broadcasting licence allocated under section 38B of the BSA (the related licence) is in force on or after 1 January 2009, and there is an multi-channelling election in force under subclause 6(7B), the licensee may apply to ACMA for an additional transmitter licence. Where multiple licensed services in digital mode are provided for under one transmitter licence and on one 7MHz channel in accordance with a multi-channelling election, the licensee may not have sufficient spectrum capacity to be able to provide multi-channelling. Making allowance for such a licensee to apply for an additional transmitter licence is designed to ensure that section 38B licensees are treated, as far as possible, in a manner consistent with other commercial television broadcasting licensees and therefore are able to provide audiences in under-served markets with additional services. New subsection 101B(2) of the RA provides that an application for an additional transmitter licence must be made in the form approved by the ACMA. New subsection 101B(3) provides that if a licensee applies for an additional transmitter licence, and the ACMA is satisfied that there is sufficient radiofrequency spectrum available, the ACMA must issue an additional transmitter licence to the licensee. The ACMA is also required to vary the relevant digital channel plan under the commercial television conversion scheme to allot a channel to the licensee. In determining whether there is sufficient spectrum available, any spectrum covered by a determination under subsection 34(3) of the BSA is taken to be unavailable because that spectrum is reserved (e.g. for datacasting services) (new subsection 101B(4)). New subsection 101B(5) of the RA provides that if the related broadcasting licence is transferred, the new transmitter licence is taken to be issued to the person to whom the related licence is transferred. This ensures that where the additional broadcasting licence issued under section 38B of the BSA is transferred, the new licensee will be

93 authorised to transmit the broadcasting service or services concerned under the related licence. New section 101C of the RA applies in relation to licence areas, both remote and non- remote, in which an additional commercial television broadcasting licence has been issued by the ACMA under section 38A or 38B of the BSA. New subsection 101C(1) provides that if a commercial television broadcasting licence allocated under section 38A or 38B of the BSA (the related licence) is in force on or after 1 January 2009, and there is an multi-channelling election in force under subclause 6(5A), (5AA) or (7B), the licensee may apply to ACMA for an additional transmitter licence. However, if the licensee has already obtained an additional transmitter licence under new section 101B, the licensee cannot obtain a further licence under section 101C. As with new section 101B, the intention behind new section 101C is that section 38A and 38B licensees are to be treated, as far as possible, in a manner consistent with other commercial television broadcasting licensees and therefore are able to provide audiences in under-served markets with additional services. New subsection 101C(2) provides that an application for an additional transmitter licence must be made in the form approved by the ACMA. New subsection 101C(3) provides that if a licensee applies for an additional transmitter licence, and the ACMA is satisfied that there is sufficient radiofrequency spectrum available, the ACMA must issue an additional transmitter licence to the licensee. This provision ensures that a broadcaster can only obtain an additional transmitter licence if there is sufficient radiofrequency spectrum available for a television channel in the relevant licence area. In determining whether there is sufficient spectrum available, any spectrum covered by a determination under subsection 34(3) of the BSA is taken to be unavailable because that spectrum is reserved (e.g. for datacasting services) (new subsection 101C(4)). An additional transmitter licence issued under new section 101C will only come into force at the end of the simulcast period, or the simulcast-equivalent period, as relevantly applies to the licence area (new subsection 101C(5)). As a consequence, it is necessary to provide specific rules for revocations of the multi-channelling election that is a precondition for the licence: � if the multi-channelling election is revoked after the application is made but before ACMA makes a decision, the application is taken to never have been made (new subsection 101C(7)); and � if the multi-channelling election is revoked after the transmitter licence has been issued, the licence is cancelled (new subsection 101C(8)). New subsection 101C(6) of the RA provides that if the related broadcasting licence is transferred, the new transmitter licence is taken to be issued to the person to whom the related licence is transferred. This ensures that where the additional broadcasting

94 licence issued under section 38A or 38B of the BSA is transferred, the new licensee will be authorised to transmit the broadcasting service or services concerned under the related licence. Item 16D - Paragraph 102(2A)(e) Item 16E - Paragraph 102(2A)(f) Item 16F - Paragraph 102(2A)(g) Item 16G - Paragraph 102(2A)(h) Item 16H - Subsection 102(2C) Item 16J - Paragraph 102(2F)(a) Item 16K - Paragraph 102A(2A)(e) Item 16L - Paragraph 102A(2A)(f) Item 16M - Subsection 102(2A) These Items are consequential to Item 16C. Item 17 - After section 102AA Item 17 inserts new sections 102AB and 102AC of the RA. The effect of new 102AB of the RA is that a transmitter licence authorising the transmission of a commercial television broadcasting service in digital mode will also authorise the transmission of the single SDTV multi-channel provided by the commercial television broadcaster during the simulcast period (or the simulcast- equivalent period if there is no simulcast period for the licence area). New 102AC of the RA provides that a transmitter licence issued to the a commercial television broadcasting licensee under section 102 to authorise the transmission one or more commercial television broadcasting services will also authorise the transmission of SDTV multi-channels and HDTV multi-channels provided by the commercial television broadcaster after the simulcast period for the licence area. Similar provision is made for existing transmitter licences to authorise the transmission of multi-channels (both SDTV and HDTV) by the national broadcasters (see section 100D of the RA, as amended by Items 15-19 of Schedule 1, and new section 100E of the RA, inserted by Item 89 of Schedule 2). Item 18 - Subsection 103(1) Item 19 - Subsection 103(2) Item 20 - After subsection 103(4) Item 21 - Subsection 106A(2)

95 Item 22 - Subsection 107(3) Item 23 - Subsection 108(5) These Items insert new subsections 103(4AA) and (4B) and make consequential amendments. The effect of new subsections 103(4AA) and (4AB) is that a transmitter licence issued under section 101B or 101C continues in force while the related commercial television broadcasting licence under the BSA remains in force. However, the transmitter licence does not have effect if the related licence is suspended under section 143 of the BSA. Item 24 - Subsection 109(1) Item 25 - After subsection 109(1) Item 26 - Subsection 109(2) Item 27 - Paragraph 111(1)(d) Item 28 - Subsection 125(2) Item 29 - Subsection 129(1) These Items insert new subsections 109(1A) and (1B) of the RA and make consequential amendments. New subsection 109(1A) clarifies that the licence conditions applicable to an additional transmitter licence issued under section 101B cannot be inconsistent with the related commercial television broadcasting licence under the BSA. New subsection 109(1B) makes similar provision in relation to transmitter licences issued under section 101C of the RA.

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