It didn't make a lot of sense to me when I was waking up, but now I'm beginning to think that it is as Murdoch says "an investment" http://www.smh.com.au/news/business/fairfax-stake-an-investment/2006/10/20/1160851097491.html - an investment in the newspaper status quo.

The ACCC wouldn't let Murdoch acquire Fairfax, but they can't stop him from determining to a large extent who can. 7.5% is close to the 10% that Murdoch needs to stop a raider compulsorily acquiring all of Fairfax.

So, the shareholding gives Murdoch a bargaining chip. He can do deals with a raider to exchange his share holding in Fairfax for something they have that he wants, or he can make life very difficult for a raider, thus making Fairfax less attractive.

From which we can draw the conclusion that Murdoch is fairly happy with the way the Australian newspaper market is currently divided.

Since Coonan stated categorically that she thought there would not be a buying frenzy following the new legislation - it shows beyond all doubt that she has no grasp of the issues and dynamics of her own portfolio - doesnt that mean she should hang her head in shame and resign on the grounds of her own sheer and obvious incompetence?

I don't think what we've seen represents a buying frenzy. The law is obviously being changed to allow media proprietors to do what they can't do now, so I would have thought Coonan was anticipating some changes.

I personally think that there's a whole lot of hype around these changes that completely over-state what is likely to happen in terms of corporate change as well as under-stating the change that technology is bringing about. As the media converge via the Internet there is going to be little difference between producers of print, audio, or audio-visual, apart from the histories of where their employers have come from.

I can already watch television news on the 'net, and when bandwidth gets large enough I'll be able to download my movies straight from Newscorp. Rupert will have a TV station in every capital city, whether the government wants it or not.

GrahamY:

"I can already watch television news on the 'net, and when bandwidth gets large enough I'll be able to download my movies straight from Newscorp. Rupert will have a TV station in every capital city, whether the government wants it or not."

I don't suppose you could imagine how some of us might see this as being at the heart of the problem, could you?

CJ, you're not suggesting trying to control the Internet are you?

Graham -

Erm... of course not, at least in terms of formal regulatory frameworks. But I'd be willing to put money on Rupert and the other boys effectively 'controlling' some parts of the Internets by commercial and litigious means, a few years hence.

Which is of course why some of us are a bit sceptical about supposed benefits to diversity from the current legislation.

Cheers.