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Budget review: ads to stay

The day after the Budget was announced word had spread in the media that SBS had received a significant increase in public funding. It will appropriate an additional $158 million in base government funding (BGF) over the next five years, including $63 million over four years to integrate NITV (National Indigenous TV) into SBS. BGF is funding that covers SBS’s operating expenses: employment, technology & content, and Indigenous TV but it excludes transmission costs. A spokesperson for SBS said the estimated BGF will be approximately $183 million for each year in 2012-16.  The actual year-by-year figures will vary somewhat from this estimated average.

For the past five years and the last 12 months in particular, Save Our SBS has been prosecuting the case that SBS was severely under-funded, was worthy of, and ought to be awarded a lot more than had occurred, ever. We put this case in formal submissions to government, letters to Ministers, personal meetings with a range of politicians from all sides, and, organised a number of public campaigns. Funding for the SBS was so low that five years ago it turned to in-program advertising. SBS said this was necessary due to public funding not keeping up with basic operating and content costs. Central to our argument was that if things had become that bad, the effectiveness of any genuine increase would be measured against SBS being able to operate without needing to turn to disrupting programs for ad breaks.

When news came through to Save Our SBS at the stroke of 8pm on Budget night direct from the Minister’s Office and from SBS, of the biggest funding increase ever, there were cheers and tears of joy. All the campaigning, lobbying, and meeting with politicians had paid off. In the month since we have studied the Budget papers more closely.

An SBS media release issued on Budget night claimed that BGF would increase by 27%. A spokesperson for SBS said that in 2011-12 BGF was $138 million. In 2012-13 it will increase to about $165 million. Thereafter it is estimated to be $180 million (2013-14), $191 million (2014-15), and $194 million (2015-16) – see graph. The actual figures will vary from these forward estimates.

Total SBS TV ad revenue (not shown on the graph) was around $46 million in 2011-12. It will spike in 2013-14 as it always does in FIFA World Cup years. An independent consulting firm advised SBS of a potential 90 percent loss of TV ad revenue if removing in-program advertising. SBS’s Managing Director, Michael Ebeid thinks this would also apply if moving in-program advertising to intra-program. Save Our SBS believes that would not be the case. Either way, the accuracy of this will never be known. 

Despite the most significant funding increase ever, Save Our SBS can confirm that SBS will not go part way to reducing the incidence of disruptive breaks. But the funding SBS has just received is not the be all and end all. In 2013, SBS will make another submission and be granted further funding for the three years 2013-16. Despite considerable viewer discontent of in-program advertising, SBS has no plans to request specific funds to wind down in-program advertising. However Mr Ebeid said SBS will not object to others pushing for that nor a change in legislation to achieve that.

SBS has walked away from this Budget with more money and a wider remit, a state of affairs that’s worth celebrating, especially in an uncertain economic environment. However, the next steps taken by the broadcaster will be vital in recognition of its supporters and setting the tone for the coming years.

Save Our SBS has been told of concerns within the SBS that under a Coalition government, the service may have to prepare for the possibility of de-regulated advertising with the view to its eventual privatisation. But the Shadow Communications Minister, Malcolm Turnbull said, “The Coalition currently has no plans to deregulate advertising on the SBS, nor do we plan to privatise the national broadcaster.” Mr Turnbull went on to say that while recognising fiscal difficulties, the Coalition supports the important role the national broadcasters, SBS and the ABC, play in the national life of Australians.

Save Our SBS is not aware of any plans of government to support Senator Ludlam’s Bill, the Special Broadcasting Service Amendment (Natural Program Breaks and Disruptive Advertising) Bill 2012 that if passed would phase out in-program advertising. It is now apparent that both government and SBS have chosen to ignore the 9,171 messages sent from loyal supporters of SBS who, in the month leading up to the Budget, shouted en-masse for a steep increase in funding so SBS could operate without disrupting programs for commercial breaks. Whilst government decided not to address the advertising issue, other than hoping SBS would, if given greater funding, the broadcaster has chosen to give nothing back. All programs will continue to have the same number of commercial breaks. Those who fought hard for the funding increase will rightly feel let down.

There is no doubt that, in the words of the Minister, this was the “most significant funding boost SBS has ever had”. However the significance will be lost on the electorate due to a failure to address the commercialisation of the broadcaster. Disruptions will continue and SBS-TV will keep forcing ad breaks into programs. The spirit, the very essence of public broadcasting in SBS has been lost to the ongoing commercial influence and interference which now has such a strong foothold that the Minister’s wish for SBS to resolve this, by throwing more money at it, is fanciful. SBS will not lead the way. But that is not reason to under-fund it either.

Imagine the mileage that the government could have gained by the Minister announcing that from the start of 2013 there would be no breaks within SBS television programs. Considering the poor polling of the government, and amongst ethnic communities in particular, this is a no-brainer. It is a lost opportunity. Despite Labor’s SBS Policy it will have come and gone from government and SBS will not have been saved. Until such time as viewers see a wholesale change in SBS, a less commercial looking broadcaster, one without in-program disruptions, the government will have failed to gain support from a significant cohort of electors.

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