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- 4 April 2006
Austar Subscription Fees
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Mr PETER DRAPER (Tamworth) [5.57 p.m.]: Tonight I wish to inform the House of a disgraceful and unjustified decision by a pay television company to attempt to gouge money from small country pubs and clubs. Recently, pay television provider Austar informed licensed premises in country New South Wales that the new monthly subscription fee for its services would more than double, without any change to, or improvement in, its services. While conducting research on the issue, one of my staff contacted the Australian Hoteliers Association [AHA] national secretary-treasurer Bevan Douglas, a successful publican from Tamworth, to seek information regarding Austar's price increases. Mr Douglas informed my staff member, among others, that the industry is extremely concerned by this development as it will have significant impacts throughout country New South Wales. In fact, industry is so concerned about the issues that the AHA has taken the matter to the Australian Competition and Consumer Commission [ACCC] and is awaiting a response.
In recent years, having a beer on a Saturday afternoon in country pubs and clubs is synonymous with being able to watch the football, and Austar provides that through a package to licensed premises across the State. I live near Dungowan, a small district some 25 kilometres east of Tamworth. I visited the Dungowan Tavern late last Saturday afternoon hoping to catch up with friends, but found the pub almost empty. Publican Kevin Smith has closed his Austar account, as he could no longer justify the expense. Austar has increased his monthly fee from $420 to $987, a hike of more than 130 per cent.
The monthly subscription fee had already risen from $242 in 2003 to $253 in 2004, and had again increased to $420 in 2005. That is appalling news for locals, who used to meet at the Dungowan pub for a few beers, have dinner with friends and watch the football matches that are not screened on free-to-air television. People who can afford Austar now stay home, and the many who cannot afford it now miss out completely. Local licensees and I believe that the absence of televised sport at their venues will result in a decline in patronage, as many country people rely on their local pub or club to get their weekly dose of league. Mr Smith is not alone in his decision to cancel the subscription. The Australian Hotels Association conducted a survey of country pubs asking if they would continue subscribing to Austar following the planned increase, and 73 per cent of hotels said they would cut off the service. Country pubs are simply not in a position to absorb such a cost. Most local clubs in my electorate intend continuing the service despite the massive cost increases, but clubs such as Tamworth Services Club, which is facing a 268 per cent increase, will not. In Manilla, only the Manilla RSL Club will retain Austar, and that will be reviewed at the end of the current rugby league season. The secretary of the Gunnedah Services and Bowls Club, James Gallon, said the club would wear the increase from $650 to $1,440 per month.
Mr Gallon, who is also a State councillor for Clubs New South Wales, said he had received more complaints from clubs across this region on the Austar increases than any other issue during his two years in the position. Pubs and clubs receive value from Austar only for the winter football season, with viewing at a minimum at other times of the year. Austar supposedly uses a formula to determine pricing based on bar turnover for most pubs, but the figures are simply an estimate. I am advised that Austar blames Foxsports for putting up its prices to televise live sport, forcing Austar to pass on the increase, but that certainly does not help country patrons. Home subscribers have not been subjected to such extortionate increases over the same period.
Hoteliers' dissatisfaction with Austar did not begin with this price hike. Mr Smith said that for a number of years he has tried to negotiate a package with Austar that includes only the sport channels, without success. Currently, the package Austar offers to licensed premises is most unsuitable. It includes Lifestyle, Fox 8, Arena, Discovery, Max, V, Country Music Channel, Nickelodeon, Cartoon Network, Bloomberg and the Shopping Channel. How many people go to a pub to watch those channels? Hoteliers question strongly the value of such a package, as few would go to a pub to watch Spongebob Squarepants, to view the stock market report or to look for a birthday present.
The National Rugby League relies on Austar to promote its game in country areas, as many people cannot receive free-to-air television. A mass boycott of the service that removes league from country pubs and clubs will have an adverse effect on the sport. Without exposure throughout licensed venues in the country, Austar's greed could affect league's support base in country areas. Austar has a protected monopoly in the country and, as a result, its operators believe that they can charge whatever price they want for their services. Quite simply, it is unfair, unethical and unjustifiable for Austar to expect small country pubs and clubs to wear such a cost. This matter should be urgently reviewed by the Australian Competition and Consumer Commission and also the Minister for Fair Trading, and I have referred the issue to them for consideration.
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