Anti-monopoly law requires debate

By Flora Chang and Hung Chen-ling 張錦華,洪貞玲  / 

Sat, Mar 02, 2013 - Page 8

New year, new start. The new Cabinet has made the proposed act regulating media monopolization one of its three main policy points and the National Communications Commission (NCC) has announced its draft broadcasting media monopolization prevention and diversity preservation act. The question is if the handling of these draft laws is too strict or too relaxed. Public opinion on the issue varies widely.

The problem is that the NCC has made the unprecedented decision to make viewer ratings the control indicator of monopolization, a move that gives the NCC far too much administrative discretion.

The NCC draft is directed at regulating the integration of broadcast media and other enterprises, and in particular at using viewer, listener and reader ratings as indicators of market concentration.

Using viewer ratings as an example, attempting to make this new indicator part of the considerations will invite several thorny issues, such as how viewer, listener and reader ratings should be defined, what kind of polling mechanism should be used and how the actual media situation should be reflected. For example, how should the influence of traditional mass media on the Internet and mobile platforms be calculated?

Currently, Nielsen’s viewer ratings are the most widely used in Taiwan. Such ratings are always criticized for the representativeness of the sample, the negative impact of immediate viewer ratings, concerns that viewer ratings are not the same as quality and so on. In future, the question of polling method design and outsourcing authorization in order to avoid the problems with current rating polls will pose a great challenge.

Another problem is whether it is appropriate to use viewer ratings as the main indicator when determining the level of media market concentration.

When calculating market concentration and the influence on public opinion one cannot only look at audiences, there is also advertising, revenue and subscribers or, to make it even simpler, the number of licenses available. Other countries often evaluate the relationship between data availability, authenticity and control purpose and method, and then adopt a mix of different indices.

Taiwan’s current standards, while also a mixture, are too limited.

According to the current enforcement rules of the Radio and Television Act (廣播電視法), the cross-ownership regulations between print media on the one hand and radio and television media on the other, restrict individual media cross-ownship to 10 percent and corporate media cross-ownership to 50 percent, while the Cable Radio and Television Act (有線廣播電視法) stipulates that the highest number of subscribers allowed for system operators is one-third of all national subscribers and that a system operator cannot own more than one-quarter of all the stations in a region.

In addition, the standard set by the NCC in both the Dafu Media case and the Want Want China Times Group case is that system operators may not operate news or financial stations.

The three broadcasting laws — the Radio and Television Act, the Satellite Broadcasting Act (衛星廣播電視法) and the Cable Radio and Television Act — that failed to be passed by the legislature on Jan. 1 — were an attempt to introduce an article separating financial holding companies from media outlets and the so-called “double 10” article, according to which shareholders who hold 10 percent of the shares in a national print media outlet or a national terrestrial radio or TV station will not be allowed to operate cable TV or radio stations or hold more than 10 percent of the shares in a system operator.

In comparison, the separation of media and financial holding companies should be part of financial legislation and the three broadcasting laws, while the draft broadcasting media monopolization prevention and diversity preservation act could focus on how to calculate viewer rating concentrations.

What differences would this make in terms of controls? For example, in terms of the principle that system operators should not be allowed to operate TV news stations, the draft law sets a limit at 5 percent for the consolidated viewer ratings for TV news stations or news show producers and broadcasters, and that is clearly incompatible with precedent set by the NCC in the Dafu and Want Want cases.

The 10 percent ownership restriction on systems operators also operating TV channels in the Cable Radio and Television Act draft is changed in the NCC draft to a viewer rating of 15 percent. How should the viewer rating be calculated? What weighting method should be used? Currently, none of this is clear, and that may create a panic.

From a neutral point of view, this draft law, which addresses both the prevention of monopolization and the preservation of diversity, shows that an effort is being made to respond to public hopes, and that is no small thing.

However, this is an important law that involves a wide range of issues and individual and fragmented opinions are far from exhaustive. The NCC should act promptly to dispel any doubts, and take the initiative to invite civil organizations, industry and academia to submit their opinions in order to be able to write a law that not only fulfills ideals, but that is also feasible.

Flora Chang is a professor and Hung Chen-ling is an assistant professor at National Taiwan University’s Graduate Institute of Journalism.

Translated by Perry Svensson