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Ministers for the Department of Communications and the Arts

Senator the Hon Mitch Fifield

Minister for Communications

Minister for the Arts

Manager of Government Business in the Senate

RadComms 2016 Keynote Speech

10 March 2016

E & OE

Subjects: Spectrum consultation, media reform

Thanks very much Richard for that introduction. I've got to say shortly after I came into the portfolio I was a little concerned when my staff said to me "You've got to go and speak at the 'RadComms' conference". It sounded like echoes of a gathering of the 1970's extreme left – for those of you old enough to remember think the Red Brigades, or Baader-Meinhof. For those of you who aren't, you have the technology to find out about them.

It's a pleasure to be here today. I want to acknowledge and thank the ACMA for hosting RadComms – it's a significant forum and a fantastic opportunity for the sector to share ideas and discuss the big issues relevant to spectrum management.

First, I'd like to acknowledge our distinguished guests, although he's not with us this morning Houlin Zhao – Secretary General of the International Telecommunication Union.

Thank you to Mr Zhao who was able to join us yesterday - on this his first trip to Australia as ITU Secretary-General.

I look forward to continuing to strengthen Australia's valuable relationship with the ITU, under Mr Zhao's leadership.

I'd also like to take this opportunity to commend Chris Chapman on his achievements during his time as Chairman and CEO of the ACMA.

Chris has been elected President of the International Institute of Communications, making him the first IIC President to come from the Asia-Pacific region.

I wish Chris every success in his new role and thank him for his efforts leading the ACMA over the last decade.

SPECTRUM – DRIVER OF INNOVATION

According to Cisco's Chief Futurist, Dave Evans, within 10 years, there will be 50 billion connected things in the world, with trillions of connections among them.

As he says: "These connections will change the world for the better in ways we can't even imagine today."

From healthcare and education, to agriculture, business and the environment, the implications of these digital innovations are profound and will affect all areas of our lives.

It's exciting stuff, but for legislators the fast pace of technological change also poses some tricky questions. As it does, no doubt, for many here who are striving to adjust to the ever-changing digital landscape.

How does Government prepare for ground breaking innovations that we can't predict?

How does Government ensure that we're ready to harness new opportunities as they emerge?

And how can Australia position itself at the forefront of this digital revolution, so that we can fully capitalise on the social and economic advantages it will bring?

One early step I have taken as Communications Minister has been to introduce legislation into the Parliament, last week in fact, to reform our media laws.

Our media ownership and control rules were written in an analogue era, for an analogue era. That world no longer exists.

A few years ago, many Australians placed their big, boxy, analogue TV sets on the nature strip for hard rubbish collection, and it's time for some of the regulation from the same era to follow.

As a general rule - the Turnbull Government believes in unshackling business from restrictive regulation and unnecessary red tape to drive productivity and economic growth.

But this is even more critical when regulation is not just unnecessary, but completely redundant.

The '75% audience reach' rule and the 'two out of three' rule are essentially about supporting diversity.

But today, every Australian with a smartphone or other connected device has access to more diversity in news sources and content than we could have dared to imagine when these laws were first created.

This is a boon for consumers who now have more choices than ever before. But it is creating challenges for our traditional media businesses.

I am confident that our media companies are doing their bit to rise to this challenge. And I am encouraged that, by and large, no one is arguing for erecting trade walls to protect Australian businesses from international competition.

Instead the argument goes the other way. Levelling the playing field means lowering regulatory barriers for our broadcasters and newspaper publishers. We want our media industry to have greater freedom to configure their businesses how they wish in order to compete against the global media industry they now face.

So we must do our part, and that means starting by getting rid of these two rules.

Because the pace of change is only increasing, we will forever be looking to reform. There will always be more to do - and I intend to do more. Our media reform legislation is only a first step.

But reform is not an exercise in doing everything all at once and then not touching it for many years. It is an ongoing process.

They say Rome wasn't built in a day. The fact that you could not build Rome in a day was not an argument to not build Rome at all.

But in the end, the crux of our current proposal is simple. If regulation is redundant it should be removed - full stop.

More broadly, the Government has released the National Science and Innovation Agenda

As part of this package, we're investing in science and technology.

We're encouraging collaboration between business, the research sector and universities.

And we're creating incentives for start-ups that will drive investment and encourage entrepreneurs to take risks and have a go.

However, we also recognise that to create an environment where innovation and ideas can truly flourish, we need the right communications infrastructure in place.

That's why we're rolling out the National Broadband Network.

And it's why we're committed to complex – but necessary reforms – including spectrum reform.

Spectrum is essential to a digitally networked economy. It now facilitates activities in virtually every corner of the marketplace, forming the hidden backbone of communication, commercial transactions and machine-to-machine interactions that are the drivers of global economic growth.

As a government, we want to make sure this important public resource is going to its best use, as easily and effectively as possible and that it is allocated and managed in a way to support industry's innovation and growth, and our future prosperity.

So the theme of this conference – 'Spectrum Reform – Enabling Innovation' is particularly apt.

GOVERNMENT IS FOSTERING INNOVATION THROUGH SPECTRUM REFORM

Australia's current framework has been in place since 1992. At the time, it led the world by introducing market-based mechanisms that allowed the most coveted parts of the spectrum to be allocated to their highest-value use.

But the communications landscape has now changed dramatically, with increasingly congested spectrum and new services continually demanding bandwidth.

The Government's Spectrum Review – released in May last year – found that the existing framework is slow, rigid and administratively cumbersome.

It is also unnecessarily costly for users and for government. Delays and administrative hurdles lead to uncertainty for industry, and impact investment decisions.

We need a more flexible and responsive spectrum management framework.
In August last year, the Government announced its response to the spectrum review's recommendations.

My predecessor indicated that the Government would focus on three important areas of reform. These are:

  • A clearer, simplified policy framework to ensure transparency and accountability in decision-making;
  • The introduction of a single licensing framework; and
  • Integration of the treatment of broadcasting spectrum into the general framework.

We also undertook, at that time, to continue to consult with industry on the implementation of the recommendations, including development of a Radiocommunications Bill.

I am pleased to inform you that the Department of Communications and the Arts will today release a legislative proposals consultation paper for a Radiocommunications Bill - the next step before the development and release of an Exposure Draft.

The Government's reforms will address current impediments in the spectrum management arrangements and establish a framework that encourages a more dynamic and responsive approach.

I welcome all feedback on the proposed approach and this input will feed into the drafting of the legislation.

The proposals paper will be available online shortly on the Department of Communications and the Arts website. Submissions will be open until 29 April 2016.

Following this, a consultation of an exposure draft on the legislation will be released and it is hoped that the new legislation will be introduced in Parliament later this year.

A clearer, simplified policy framework

The cornerstone of the reforms will be a new Radiocommunications Bill that will modernise Australia's regulatory regime and allow industry greater scope to respond quickly in the market to emerging technologies and services.

A simpler, more clearly structured Act will remove unnecessary process and prescriptive detail.

It will better support new investment in spectrum‑based networks by allowing new technologies to be deployed and spectrum to be allocated more quickly.

The Bill will also clarify the roles of the Minister and the ACMA.

Responding to feedback from industry, the Minister will have a greater focus on strategic policy leadership. This will be achieved through the introduction of Ministerial policy statements, which will allow the Minister to establish upfront strategic policy intent or outcomes.

The Minister will retain the ability to direct the ACMA on specific policy matters – such as major allocation decisions – although where possible, the Minister will be removed from administrative processes.

The ACMA will have primary responsibility for timely and efficient administration of the spectrum management framework – in particular, clearer reporting of its regulatory operations.

The Bill will provide that the ACMA must act consistently with policy statements and publish an annual work program. The ACMA will also be expected to notify the Minister of specified decisions. Again, it's about improving the timeliness and communication of processes and decisions.

One thing I want to make clear is this: a shift in paradigm is necessary to achieve the policy outcomes we, as a Government, and as spectrum users, need.

The introduction of a single licensing framework

Demand for spectrum is growing at an unprecedented rate.

Removing legislated categories and moving to a single licensing framework is key to encouraging the most efficient and innovative use of spectrum.

As licences become more generic in nature, they are more easily shared, traded and leased.

To this end, the legislation will set out core parameters that a licence must address, such as frequency and geographic area of operation, licence duration, rights of renewal and pricing.

The ACMA would then be free to create conditions relevant to the licence in question. 

Broadcasting

With regard to broadcasting, we must consider the current framework alongside technological advances in broadcasting spectrum.

The reforms propose integrating the planning, licensing and pricing of broadcasting spectrum into the general spectrum management framework.

The Minister will no longer be required by legislation to designate spectrum specifically for broadcasting services, instead relying on the general planning powers proposed in the new Bill to be administered by the ACMA.

Bringing the treatment of broadcasting spectrum in line with the general framework is a significant step in laying the groundwork for more efficient spectrum use.

But more importantly, it will also enable broadcaster-initiated changes of spectrum use in the future.

As a result of the reforms, broadcast licence holders will have greater flexibility to manage and plan their spectrum holdings, meet their business needs, adopt new technologies and control costs.

The Government is committed to ensuring that broadcast licence holders will continue to have certainty of access to spectrum to deliver their broadcasting services.

Like other spectrum users, broadcasters will be able to share, trade or lease all or part of their spectrum, subject to the conditions of their licence.

The proposed broadcasting amendments will require consequential amendments to the Broadcasting Services Act.

The revisions will focus on creating a greater distinction between the two Acts, with the Radiocommunications Act to focus on spectrum-related matters and the Broadcasting Services Act on broadcasting policy matters.

It follows then, that the Digital Radio Access regime and the access regime for digital transmission towers will be transferred to the Broadcasting Services Act as they deal with broadcasting market participation access issues.

Compliance and enforcement

In line with the Government's deregulation agenda, the reforms will also simplify and modernise technical regulation, compliance and enforcement for industry.

In response to industry feedback the reforms will introduce options for the ACMA to delegate functions to third parties; enabling industry to manage its own spectrum holdings.

A more graduated range of compliance and enforcement options will enable the ACMA to take a more targeted, risk-based approach to management of interference and other issues.

But legislation is just one part of what is needed

As I foreshadowed earlier, a new Radiocommunications Act will be required to implement reform of this nature.

But legislation is just one part. Cultural change will be absolutely vital to successfully delivering this flexible and responsive spectrum management framework.

These reforms will change my role, as Minister, in spectrum management processes. Through Ministerial statements, I expect to be more involved in the strategic direction of spectrum management and less involved in day-to-day matters.

Similarly, the role of the ACMA will change. In real terms, the ACMA will be responsible for implementing and operationalising this new approach.

A key element in supporting the ACMA's evolution as a regulator will be the outcomes of the Review of the ACMA, which is currently underway.

Policy makers, regulated entities and the community have ever-increasing expectations about the capacity of regulators to strike the right balance in their regulatory activities, such as:

  • Being effective without being unnecessarily intrusive;
  • Making decisions quickly, but with high levels of accuracy and procedural fairness; and
  • Being responsive to industry without being captured by their views.

The role of the regulator is a vexed one, however, over the coming 12 months, I expect that we will see the ACMA evolve – with less emphasis on its traditional technical and regulatory approach, and towards its new role facilitating this flexible, more transparent and market-orientated approach to spectrum management.

I also call on spectrum users to think creatively about how to embrace the opportunities offered by the new spectrum management framework: whether it is through the licence conditions you negotiate with the ACMA, the opportunities for spectrum trading, or use of band managers.

The new framework is designed to be agile and responsive to your needs. I urge you all take advantage of this opportunity to innovate.

SPECTRUM PRICING REVIEW & GOVERNMENT SPECTRUM HOLDINGS

In addition to a new Radiocommunications Act, we are also undertaking a review of spectrum pricing.

This review is considering all aspects of pricing exemptions, concessions, and administrative taxes and charges, to ensure that they are consistent, transparent and support the efficient use of spectrum

Our focus, to date, has been to pursue reforms of the wider legislative framework. However we are also conscious that in order to achieve a valuable outcome from this work, it will be critical to improve the pricing arrangements which are vital in affecting spectrum utilisation and supporting secondary markets.

Consultation with industry will be an integral part of reviewing pricing, as has been the case for the legislative framework (and it will continue to be so).

Additionally, the Government is the largest holder and user of spectrum, however there is little transparency of the value of its holdings.

Furthermore, there is limited scope or incentive for government agencies to facilitate alternative uses of their spectrum holdings.

A review of Commonwealth spectrum holdings is underway so we will have a better understanding of Government holdings, and look at ways we can promote more productive uses of spectrum.

These reviews are expected to be complete by the middle of this year.

CONCLUSION

This is a significant period for spectrum management. The reforms we are undertaking now are not about today or tomorrow. Rather it is about the actions we take now - putting in place the regulatory arrangements, institutions and governance to support our future economic growth.

In doing so, we must take a far-sighted view of reform and not wait for a 'burning platform' to drive change.

As demand for wireless services increases, spectrum management arrangements must be dynamic and flexible.

To this end, the spectrum management framework will continue to be developed to meet changing circumstances.

I want to close by emphasising that the Australian Government's reforms are not intended to mandate particular approaches to the use of spectrum.

Instead, they are designed to remove barriers to innovation and encourage industry to manage spectrum in different ways.

So I look forward to working with industry and other stakeholders to lay the foundation for a strong spectrum management framework that will benefit Australia now and well into the future.

Thank you.

Media contact: Justine Sywak | 0448 448 487 | Justine.sywak@communications.gov.au

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