Australian Competition and Consumer Commission has released a Statement of Issues on the proposed acquisition of Australian Regional Media (ARM) from APN News and Media (ASX: APN) by News Corporation (ASX:NWS).
The proposed acquisition would combine the two main newspaper publishers in Queensland, adding ARM’s community and regional publications in Queensland and northern New South Wales to News’ extensive portfolio of community, regional, state, and national publications. The ACCC is investigating the effect that this would have on competition for both readers and advertisers.
“One area of focus is the loss of competition between ARM’s paid regional newspapers and News’The Courier Mail. If the proposed acquisition proceeds, News will own both The Courier Mail and the local paid newspaper in nearly every city or town in Queensland. This may result in a reduction of quality and diversity of content available to readers. Reinforcing that concern is that both News and ARM have a strong presence in online news through their websites associated with the Queensland newspapers,” ACCC Chairman Rod Sims said.
“The ACCC is seeking to understand whether the competitive tension between News and ARM is an important factor in maintaining quality and range of content, or whether the threat of readers shifting to alternatives, particularly alternative online news sites, will competitively constrain News after the acquisition.”
ARM publishes paid daily regional papers in Mackay, Rockhampton, Gladstone, Bundaberg, Hervey Bay, Gympie, Sunshine Coast, Toowoomba, Ipswich and Warwick. The ACCC will be looking closely at these areas.
“In particular the ACCC will test how important diversity of content and opinion is to readers when assessing the extent of competition between papers,” Mr Sims said.
ARM and News both also publish overlapping community papers in Caboolture/Bribie Island, south west Brisbane, Brisbane northern bayside, Logan, and Tweed Heads/southern Gold Coast. These are mostly free papers with a strong local focus. The ACCC is seeking to assess the effect on readers and local advertisers in those areas, and to assess whether the reduction in competition is significant.
“The ACCC will be assessing the importance of diversity of local content in these competing community publications. The ACCC is also seeking to understand whether advertising opportunities on other media platforms, such as local radio, pamphlets, and online, will constrain prices for advertising in the ARM and News community newspapers,” Mr Sims said.
The ACCC invites further submissions from industry participants in response to the Statement of Issues by 27 October 2016. The ACCC expects to announce its final decision on 1 December 2016.
Further information and the ACCC’s Statement of Issues is available on the public register:
Background by the ACCC:
News is a global media company with subscription television, magazines, newspapers and publishing operations and interests. In Australia, News publishes a number of state, regional and community newspapers as well as its national publication The Australian. It also publishes websites associated with many of its newspapers as well as news.com.au.
APN is an ASX-listed Australian company with media, radio, publishing and digital assets in Australia, and outdoor advertising assets in Australia, New Zealand and Hong Kong. The ARM division of APN, which is proposed to be sold to News, includes a large number of mostly regional publications in Queensland and northern NSW, including 12 paid daily, 14 paid non-daily and 32 free non-daily community newspapers.
APN's radio and outdoor assets are not part of the proposed acquisition and will be retained by APN.