Tuesday, 18 November 2014

When free market principle and self interest collide – which will the Murdoch team back?

“We’re for Sydney” the page one banner declares. To which, if today’s Daily Telegraph is any guide, we could add “But self interest comes first.”
Hence the Tele’s big issue of the day. Newsagents might lose their monopoly right to sell lottery tickets, it told us on page one.
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And what a terrible thing that would be for these brave and battling small business people.
NEWSAGENTS in NSW have warned they face annihilation if lottery ticket sales are opened up to big players such as Coles and Woolworths.
As a condition of privatising NSW Lotteries in 2010, the then Labor government agreed to a five-year moratorium with new owners Tatts that prevented supermarkets and other big retailers from selling lotto tickets and scratchies. But the arrangement is due to end on March 31 — the week after the state election. …
Lottery sales provide between 25 and 90 per cent of newsagent income and the Newsagents Association of NSW and ACT (NANA) said allowing big retailers into the market would devastate hundreds of retailers.
To make matters worse, Tatts wants outlets to shell out up to $25,000 on mandatory shop refits and fresh branding once the moratorium ends.
They will also demand payments from lottery agents twice a week, rather than the existing weekly arrangement, which NANA says will put fragile cashflows at risk.
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Not a mention there of what the closure of newsagents might mean to newspaper sales. But plenty of room on the opinion page for the newsagents’ lobbyist to make his special pleading for “all sides of politics to enshrine in legislation the current network of small businesses.”
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And so to the editorial verdict from this stout media defender of competition and the merits of more and more deregulation. It started off being true to these fine principles: “The sought-after outcome in any deregulated economic sphere is an increased number of participants.” But by the end? Well, what do you know.
… some 1500 newsagents now face the possibility of losing lotto sales revenue to the two largest supermarket operators. That loss would be considerable. Such sales provide between 25 and 90 per cent of newsagents’ income. You can see why a dramatic decrease could very likely see them be forced to close.
There is a reasonable argument for the maintenance of current limitation of lottery products to newsagents.
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And still not even a mention of the impact of all this on newspaper proprietors.
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