Cross-media issues not on broadcasting watchdog’s wavelength

Regulator appointed in 1991 could demand greater powers over media owners

BAI  chief executive Michael O’Keeffe suggested he had no interest in asking ministers for extra powers to apply updated ownership and control rules on existing media owners. Photograph by Matt Kavanagh

BAI chief executive Michael O’Keeffe suggested he had no interest in asking ministers for extra powers to apply updated ownership and control rules on existing media owners. Photograph by Matt Kavanagh

 

Who remembers March 1991? Mary Robinson was three months into her presidency, while the United States had just obliterated Saddam Hussein’s army in the first Gulf War after the invasion of Kuwait.

Closer to home, the Birmingham Six were freed that month. In business news, the Government passed laws to allow the privatisation of Irish Sugar, while in sport, Ryan Giggs made his debut for Manchester United as a wiry 17 year old.

Chesney Hawkes was Top of the Pops with The One and Only. Not that many will remember that tune – it’s too traumatic.

In March 1991, Michael O’Keeffe was appointed chief executive of the Independent Radio and Television Commission. He had joined it upon its establishment in 1988, when for the first time the State allowed broadcasters other than RTÉ to legally operate here. O’Keeffe was at the centre of this seminal change.

Risk

The IRTC was replaced in 2001 by the Broadcasting Commission of Ireland, which became the Broadcasting Authority of Ireland (BAI) eight years later. O’Keeffe, who is currently the BAI’s chief executive, has been at the helm all of this time – the State’s broadcasting regulator for almost 28 years.

That gives him an enormous depth and breadth of experience, for which he is widely respected and liked. But it also could be argued that, as a regulator, such a lengthy tenure runs the risk of giving off the appearance that O’Keeffe is now almost part of the system he is put in place to oversee.

It is a truism of regulatory economics that the public interest is best served by keeping the regulators well apart from the regulated entities. We learned that lesson painfully during the banking crisis, and it should never be forgotten.

The head of Ireland’s energy regulator, Paul McGowan, has been involved for less than six years. Philip Lane, the Central Bank governor and the State’s ultimate financial regulator, is another virtual newbie at just three years.

Ian Drennan, the State’s corporate watchdog via the Office of the Director of Corporate Enforcement (ODCE), has been in situ for just over six years. Jeremy Godfrey, the communications regulator, has served five years.

O’Keeffe is far and away the elder statesman of the Irish economic regulators. Three decades is a long time to oversee the broadcasting industry. Meanwhile, the BAI, established by the Dáil in 2009, is also the only State body with a remit to monitor cross-media control and ownership in the interests of the wider public.

Esteem

His epic tenure does not mean the regulator is not regarded by those whom he regulates. O’Keeffe is held in esteem across the board. The commercial and media empire of businessman Denis O’Brien respects him. This is evident from documents filed in court as part of an ODCE investigation into Independent News & Media (INM), where O’Brien is the main shareholder with a shareholding of just under 30 per cent.

Drennan, as head of the ODCE, filed in court a swathe of text messages unearthed during its investigation. On January 12th, 2017, Leslie Buckley, INM’s then chairman, and O’Brien’s friend and close business ally, texted O’Brien about the decision of Denis Naughten, then the communications minister, to refer INM’s ill-fated takeover bid for the Celtic Media newspaper group to the BAI for approval.

Here is a perfect example of the BAI’s cross-media watchdog role in action, as O’Brien is also by far the biggest private investor in radio, via Communicorp, whose sprawling portfolio includes national radio broadcasters Today FM and Newstalk.

The Celtic Media referral clearly irked Buckley, who believed it was unprecedented. He told O’Brien: “I think O’Keeffe is the type of guy that won’t be pushed around.”

The true meaning of Buckley’s text is a little ambiguous. Who did he think might try to push O’Keeffe around? Did he mean the minister’s office as they looked for someone to kill off the takeover to sate public anger at O’Brien’s expanding media interests?

Or did Buckley mean that O’Keeffe would not be pushed around by those whom he was regulating? The fact that INM’s then chairman was musing about whether a regulator could be “pushed around” by anyone is disturbing in itself.

In the end, the deal was pulled before the BAI’s recommendation to the minister was made public.

Policies

This week, the BAI proposed new policies for media ownership and control, and media plurality. At the launch, O’Keeffe indicated he would ask the Government for greater powers to assess the impact of investors’ digital media holdings.

He suggested he had no interest, however, in asking ministers for extra powers to apply updated ownership and control rules on existing media owners: the rules become relevant only when there is a media transaction or change in control. “It wouldn’t pass muster,” he said, suggesting he wasn’t even prepared to make the case.

This means that O’Brien escapes scrutiny for his cross-media ownership. From politicians to non-governmental organisations, people have been calling for greater scrutiny for more than six years since O’Brien marched triumphantly over the hill at INM to vanquish the O’Reilly family.

O’Keeffe this week also stood over his 2012 determination that O’Brien doesn’t “control” INM. His regulatory peer, Drennan at the ODCE, clearly suspects otherwise, as he raised concern in his court filings that INM was being run for the benefit of its major shareholder.

As he showed with Celtic media, it appears true that O’Keeffe will not be pushed around. But perhaps it is about time he also started to do some pushing himself, and demanded greater powers to keep influential media owners in check.

FOOTNOTES

Ganley shooting expenses in the crosshairs

Shooting has long been a favoured past-time of the landed gentry. I’ve never really bought into the recreational value of firing a weapon, but each to their own. Still, who can think of going shooting without imagining well-to-do folk creeping among the heather, wearing tweed pants and those funny hats that keep your ears warm, but make you look ridiculous.

Declan Ganley, the prominent businessman who lives on a Galway estate (the type with sprawling fields and lakes) likes shooting.

A note to the accounts this week for his Rivada Networks suggested the company had spent about €280,000 on shooting activities, entertaining potential investors at another nearby estate. How could anyone spend more than a quarter of a million euro shooting in Galway? What were they firing: Gustavs? For that kind of money, you’d want to go hunting for woolly mammoth.

It turns out that the note was an administrative error. Ganley did not spend €280,000 on some slaughter of the avian innocents while raising capital. The total apparently includes all entertainment and hospitality expenses for the company’s clients and staff, and only a small part of it was spent on shooting.

The back of Red Flag’s Christmas card alludes to Karl Brophy and Gavin O’Reilly as members of the so-called INM19 whose data was allegedly breached at the publishing group.
The back of Red Flag’s Christmas card alludes to Karl Brophy and Gavin O’Reilly as members of the so-called INM19 whose data was allegedly breached at the publishing group.

Sea of red in Red Flag Christmas cards

Red Flag, the communications agency run by former INM executive Karl Brophy, and chaired by former INM chief Gavin O’Reilly, once again wins the Christmas card competition.

Last year’s card was a nod to Donald Trump’s rockets row with North Korea. This year, it alludes to the US president’s tirades against immigrants. “Migrant caravan halted at the border, sir,” says a US soldier, amid the carcasses of reindeer and a fat man in a red suit. We won’t show the picture, lest it frighten the kinder.

The back of the card alludes to Brophy and O’Reilly as members of the so-called INM19 whose data was allegedly breached at the publishing group. Santa speaks on the phone with a mysterious someone, who relays a query as to why presents for Brophy and O’Reilly were diverted to the Isle of Man.

“What do you mean the High Court inspectors have been on the phone?”

Ho ho ho...

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