Why the new MDA online licensing framework is censorship

I've been using the Internet for a very long time -- since 1995 or so. I remember the days of pine, lynx and tin; irc, talk and finger. I remember soc.culture.singapore and soc.culture.singapore.moderated. I remember seeing the very first Singapore National Education post from mrbrown, back when podcasts haven't been invited and he was probably wearing pants everyday instead of shorts.

And yes, I also remember when the Singapore Broadcasting Authority (MDA's predecessor) first introduced the Class Licence scheme in 1996, and the firestorm of anger within the (very much smaller) internet community then.

To SBA/MDA's credit, it has indeed, for the most part, administered the Class Licence scheme with a "light touch" in the 17 years since. So when various ministers say that the MDA would continue its "light touch" regime, I actually think that will be true on a day-to-day basis -- for the most part.

But that is not the whole picture. And sadly, so far no government official or representative (except perhaps for MP Baey Yam Keng) has seen it fit to squarely and directly confront the issues raised by bloggers, and as the Talking Point programme has shown, by regular Singaporeans as well.

The one glaring exception to SBA/MDA's "light touch" regime provides a cautionary tale on what happens when a regulator has broad discretion in a regulatory environment with ambiguously-worded legislation.

Sintercom (which stood for Singapore Internet Community) was the very first, and in its time the leading, socio-political website in Singapore. In 2001, just before the General Election that year, the SBA made a ham-fisted attempt at getting Sintercom to register as a political website. It did register, but eventually decided to shut down soon after. I can still remember the consternation in the community when that happened. From what I can recall, the summary at http://en.wikipedia.org/wiki/Sintercom seems pretty accurate.

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The new licensing framework for online news sites does not establish regulatory parity between the Internet on the one hand and print and TV on the other; the decentralised and democratising nature of the Internet, as compared to the resource-heavy nature of print and TV, makes that simply impossible.

But the new framework does establish regulatory parity between the 10 websites targeted by MDA, and the print and TV outlets already regulated by MDA. It does so, by subjecting the targeted websites to the same sort of opaque licensing regime as print and TV outlets are subject to, which ultimately tends to encourage self-censorship and threatens media independence.

(Those who would claim that the mainstream media is free and independent in Singapore, would do well to read "OB Markers: My Straits Times Story" by former SPH editor-in-chief Cheong Yip Seng, and then take a look at the Newspapers and Printing Press Act.)

The new framework allows the MDA to take the targeted websites out of the existing Class Licence framework, and issue them with individual licences under Section 8 of the Broadcasting Act. Section 8(2) states:

"Every broadcasting licence, other than a class licence, granted by the Authority shall be in such form and for such period and may contain such terms and conditions as the Authority may determine."

Basically, the MDA can decide what the terms of the individual licences are, and presumably can also decide that the terms are confidential, such that the public will never actually know what the licences say. After all, does anyone know what is in SPH's or Mediacorp's licences?

Today, the MDA has decided that the targeted websites must take down content in 24 hours and put up a $50,000 performance bond -- conditions which do not appear in any published legislation, but only in the Government's press statements.

Tomorrow, the MDA can change the licensing terms to say that the websites must also proactively screen content and obtain MDA approval for editorial appointments -- and we may never know. I'm not saying that the MDA will do this, but Singaporeans need to know that they can.

And for the record, Singaporeans do not know what other terms, if any, exist in the individual licences issued by the MDA to the targeted websites.

Laws exist as much to empower governments to do good, as to protect citizens from their governments.  Unfortunately, most Singapore legislation focuses on the former and completely disregards the latter. This MDA regulation is just the latest example of that, and the way it was introduced is just a very stark reminder of how imbalanced our legislative system is, that something with such potentially broad impact can be made into binding law with no discussion at all.

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Let's go back to the various assurances proffered by the Government, in the days since it announced the new regulations. For me, they have all been meaningless chaff, smoke and mirrors that seek to distract from the central truth: that the MDA has established a framework whereby it can now easily take a website out of the Class Licence scheme, and impose whatever terms it wants on that website. All of this can be done, without any shred of transparency or accountability. Even if the same content standards apply for both the Class Licence and individual licences, the levers through which the MDA can exert power and influence are radically different.

I drew two main conclusions from all the empty statements from the Government:

• The Government has issued many, many clarifications. It has had many, many opportunities to clarify whether non-commercial websites like The Online Citizen fall within this new licensing framework, which it has spurned. I can only conclude that commerciality or otherwise is not relevant to this. Acting Minister Tan Chuan-Jin seems to have confirmed as much on Talking Point, where he seems to say that blogs (non-commercial) can be subject to individual licensing if  it "reports news", which is really a meaningless and arbitrary distinction in today's world. 

• The Government has thrown up strawman after strawman in trying to justify the new framework. The references to racist comments, need to ensure that sites co-operate in taking down content, etc. all become meaningless, when you consider that:

1. apparently all of the 20-something take-down requests issued by the MDA in the past 17 years have been successful.
2. of these requests, only 1 was not for sex-related advertisements, and that was a takedown request issued to YouTube over the "Innocence of Muslims" video -- and YouTube is not on the list of targeted websites. Let me repeat that: the MDA does not see fit to individually license the one website that has actually received a takedown notice over potentially inflammatory content in the past 17 years.

The new framework is ostensibly to ensure fair and accurate news reporting, and yet the Government throws up justifications that have nothing to do with news reporting at all. Indeed, the Government has not cited one single example of unfair or inaccurate news reporting. And, as either Bertha Henson or Arun Mahizhnan pointed out on Talking Point, inaccurate news reporting is best combated by clarifications and rights of reply -- not outright removal of content.

So the objective of this new licensing framework must be something else altogether. The obvious suspect is censorship, or rather the power to censor, over independent media outlets like Yahoo! and The Online Citizen. (See also my interview in the Straits Times last Saturday June 1.)

The Government has had ample opportunity to make its case for why that is not so. It has failed abjectly in every single attempt.

I am overseas and will not be able to join the #freemyinternet protest on Saturday June 8. I will however blackout this blog on Thursday June 6, in solidarity with my fellow bloggers in Singapore. I have also signed the petition calling for the withdrawal of the new licensing framework.

73% of respondents to the Talking Point live poll think that the new licensing framework will limit online news content. If you do not want to see that happen, please sign the petition and join the protest at Hong Lim Park from 4-7pm on Saturday.

Make it a fair game for all

This was published in TODAY on 17 April 2007. There was a response from StarHub on 23 April 2007. I would only say that:

1. Being the incumbent, they would say all that, wouldn't they?
2. Singapore is supposed at the bleeding edge of regulatory issues, so I would not put too much emphasis on the fact that no other jurisdiction has adopted such an approach to exclusive content agreements.
3. It would not be difficult to construct a mechanism whereby content owners receive part of the fees paid by sub-licensees to licensees, so that overall they still receive a fair price for their content.
4. If EPL's choice is between granting a non-exclusive licence for Singapore at $100 million (less than the reported $150 million paid by StarHub for an exclusive licence) and bypassing the Singapore market entirely at zero dollars, which do you think EPL will choose? I think by definition, all rational beings will choose the former. The only possible argument in response is that EPL may decide to forego Singapore entirely, to deter other regulators from following in Singapore's footsteps. I don't know if that is a realistic threat.
5. In any case, my main thrust is that MDA is trying to have its cake and eat it, by retaining exclusive content agreements while encouraging Pay-TV competition. I'm actually a little ambivalent on exclusivity per se, I just think it makes effective competition in the Singapore context really difficult.

Make it a fair game for all

Content exclusivity harms competition and hurts consumers

Tuesday • April 17, 2007

SIEW KUM HONG

THE Media Development Authority (MDA) recently announced its first triennial review of the media competition code. This is timely, given the significant changes in both the media and competition regulatory landscapes since the code was introduced in 2003.

SPH MediaWorks is no more. The MDA has implemented a licensing framework for Internet Protocol TV (IPTV) services. A new pay TV operator, M2B World, commenced operations last year, while SingTel will launch its IPTV service this year. Meanwhile, the Competition Act administered by the Competition Commission of Singapore has come into force.

In this light, the MDA's proposed changes are positive. They position the code for the upcoming battles in the pay TV market. More importantly, the MDA's regulatory approach will be updated, to become more flexible and more consistent with the approaches of the Competition Commission and of the Infocomm Development Authority (IDA) in regulating the telecommunications industry.

But there remain a couple of issues. Firstly, the MDA has proposed a new prohibition against "anti-competitive leveraging". This prevents a media service provider from relying upon a non-media affiliate's significant market power to unreasonably restrict media competition. This mirrors a similar provision in IDA's telecommunications competition code. But StarHub competes in both the media and telecommunications industries, and SingTel is a dominant licensee in telecommunications. Meanwhile, M1 has also announced plans for a pay TV service.

So, potential complainants may try to "forum shop" for a friendly regulator. Worse, a failed complainant before one regulator may try again before the other, hoping for a more sympathetic ear. The MDA and the IDA will therefore have to work closely, to avoid any anomalies in regulatory decisions.

A bigger issue concerns exclusive content agreements by pay TV operators. In 2003, the MDA sought the public's comments on whether such agreements were anti-competitive, since some content can be so essential that an operator can effectively foreclose competition by tying up such content exclusively. Possible critical genres identified by the MDA included English sports, English films and English education.

The MDA eventually concluded last year that "while certain content could be considered critical for the success of a pay TV service, exclusive carriage agreements per se do not substantially foreclose potential entrants' access to key content for the pay TV market in Singapore." In other words, the MDA thought that such exclusive arrangements did not, in and of themselves, preclude effective competition in the pay TV market.

At that time, the MDA was also conducting a tender exercise for a second pay TV licence, the incumbent being StarHub Cable Vision. There were no bidders. Observers then attributed the lack of interest to uncertainty over the MDA's position on exclusive agreements.

The MDA's decision has not deterred entrants, as can be seen by M2B World's service and SingTel's and M1's plans. But let's put that into context. M2B World is aiming for 10,000 subscribers in Singapore by 2007. With over a million resident households, that represents a penetration rate of below 1 per cent. If M2B World is viable, it is probably because it is also available in the United States, resulting in economies of scale not available to Singapore-only operators.

For SingTel, it was probably compelled to launch an IPTV service so that it can have a "triple play" offering of mobile, broadband and pay TV.

The same reasoning goes for M1. But it remains unclear whether their IPTV services will be viable, without the all-important rights to the English Premier League (EPL).

Last year, StarHub won a bidding war against SingTel and ESPN Star Sports for the Singapore rights for the next three EPL seasons. StarHub's bid was rumoured to exceed $150 million, or eight times what ESPN Star Sports paid for the preceding three seasons. The magnitude of the increase in fees suggests that StarHub may see EPL as critical to its pay TV service — which is exactly why such rights should not be exclusive.

The bidding war also worried many consumers, who fear that StarHub will charge more for EPL matches to recoup its outlay. And therein lies the danger of exclusive agreements. When it is an all-or-nothing proposition, operators will bid high to secure critical content — with the increased costs being passed on to consumers. It is not surprising that during the public consultation, channel owners were unanimous in supporting the status quo.

At the end of the day, competition for its own sake is pointless. Competition is good only if it benefits consumers, normally through greater variety or lower price.

But in the case of pay TV, even as the MDA seeks to update the code, it has not addressed the very big elephant of exclusive content agreements in the middle of the room. I hope the MDA is right, and SingTel's and M1's IPTV services can be truly competitive.

The writer is a corporate counsel and a Nominated Member of Parliament commenting in his personal capacity. He co-authored a submission to the MDA for the public consultation exercise in 2003.