Reply to The Online Citizen on MDA Regulations

I refer to the op-ed by Mr. Howard Lee “MDA regulations – Still no clarity, just another questionable voice”. 

In this rebuttal to my article on the Free My Internet’s statement, Mr Lee raises several points which I will clarify below.

Firstly, my comparison of the Breakfast Network and the Independent was never based on mere statistics. Instead I clearly stated that it is untenable to keep asserting that with respect to the Breakfast Network’s demise, “it was the regulatory hurdles that killed it, rather than a lack of managerial expertise and depth.” 

One of the fundamental mistakes that FMI and like-minded detractors keep making is the misunderstanding that it was the website that the Media Development Authority was trying to regulate, rather than the company set up to operate the website and other related social media. This has led to the absurd accusation that the MDA (and I) do not understand how websites operate. 

A company is set up in order to establish a commercial, profit-making enterprise. A company has directors and senior employees also have to take responsibility for the actions of the legal entity. (thus needing all senior management of the company to sign off on the forms of the MDA – if a company is relying mainly on volunteers, then one has to wonder how serious that company is in being a sustainable business).

A successful company also needs a strong management team and sufficient financing, especially in the start-up stage to not only survive the competition, but also to ensure that the start-up complies with the law – regulatory or financial.

It is thus my opinion that looking at the two management teams, the primary  reason for the Breakfast Network Pte Ltd’s demise was NOT that the regulations were too onerous, but that its team (being essentially consisting of the founder and a team of volunteers) was too weak to navigate and set-up the necessary internal processes in order to comply with the regulatory environment. 

On the other hand, The Independent’s team consists of a successful entrepreneur with a track record of success, a founding partner of a law firm and a veteran journalist who also owns shares in a leading PR firm in Singapore.   It is also my belief that given the financial circumstances of the founders of The Independent, and strength in numbers, the company that owns The Independent was in a stronger financial position to ensure that the company is able to comply with regulatory requirements moving forward.

The failure of The Breakfast Network Pte Ltd was thus not a regulatory failure, but a business failure. To blame its demise on ‘onerous forms’ is thus to ignore the fact that its rival has managed to survive and maybe even flourish, arguably as a result of a stronger management team and finances.

Secondly, FMI’s and similar detractors’ inability to differentiate between social media, and the company that operates social media, has further led to their confusion and unjustified anger towards the MDA’s insistence of regulating the Breakfast Network Pte Ltd’s (the company’s) Facebook and Twitter feeds, even after the website was shut down. 

(Mr. Lee, in his Op-Ed, on the other hand mistakenly believes that the MDA wanted to regulate the Facebook and Twitter feeds after the COMPANY was shut down. This is false).

It does not matter what new media the Breakfast Network Pte Ltd (the company) uses to publish its socio-political views – be it website, Facebook, Twitter or Instagram. It is the COMPANY that MDA seeks to regulate, not the media per se.

Now that the company is in the process of being liquidated, there is no company left to regulate. If the volunteers of the Breakfast Network continue to run the Facebook page as a hobby, this is a different matter.

Mr. Lee’s points regarding Yahoo and The Broadcast Act are also egregious examples of a stubborn refusal or inability to understand the difference between class licenses, individual licenses, the responsibilities under the Broadcast Act, and the registration required of the companies that own The Independent and The Breakfast Network.

To apply for individual licenses (that for example Yahoo are regulated under), is in fact more onerous than the requirements needed under registration under class licenses. For example, Yahoo has to put up a 50,000 Singapore Dollar bond, that The Breakfast Network and The Independent were not required to do. They are also subject to the 24-hour take-down clause, which again The Independent (having registered) is not required to do.

The Broadcast Act’s provisions, are also more stringent than the class license registration. For example, the Broadcast Act allows the MDA to declare a foreign broadcasting service to be interfering in domestic politics and have their business restricted. This is a provision that The Independent is not subject to.

The parts of the Broadcast Act that regulate SPH and Mediacorp also allow the Government to ratify the appointments of their CEOs and object; again an additional layer to ensure that whatever foreign advertising they receive are bona fide. The Independent is not subject to this.

Therefore, by allowing the companies that own The Independent and The Breakfast Network to receive bona fide foreign advertising, and requiring them to ONLY register under a class license (rather than obtain an individual license), and to give an undertaking not to receive foreign funding, is in fact a LESS onerous regulatory regime than all the other examples Mr. Lee has brought up.

I recognise that the Broadcast Act and the various distinctions between class licenses and individual licenses are complicated and phrased in legalistic terms. If  Mr. Lee, the FMI movement and similar detractors have problems understanding them, they should seek expert advice, instead of insisting on the ridiculous accusation that the Government has failed to explain itself.