Well now, suddenly media regulation is a hot topic again in Australia following the phone-hacking scandal.

Outrages such as the homophobic attack on NSW politician David Campbell, or the purported “n-de photos” of Pauline Hanson, or Lachlan Murdoch’s move into Ten with an apparent agenda to nobble competition for Fox Sports, have all come and gone with only a few lonely voices arguing there was a problem with our approach to privacy and media diversity.

But now that the media industry is having its own Arab Spring and an ageing dictator and his family are under siege, everyone’s up for the game of Regulate the Press.

However, it pays to understand the nature of the playing field. The way we regulate media is based on licensing. If you want to broadcast a TV or radio service, you need a licence.  And licensing is based on the power of transmitters. That’s why we regulate media diversity based on things called radio licence areas. Just to describe it is to demonstrate how out of date it is.

Nevertheless, licensing is the basis for the “co-regulatory” model we use to regulate broadcasters: apart from a few core conditions — which don’t include being a “fit and proper person” — they establish their industry standards and an independent regulator, independent of media and politicians, enforces it (well, that’s the idea, which ACMA doesn’t necessarily live up to).

That’s why, a priori, we need to be careful of any regulation, or even investigation, of the media that is not conducted independently of politicians. They can set the rules, but then they need to clear off out of it (more on this a bit later).

So where do newspapers come in on all this? Well, they don’t — you don’t, notionally, need a licence to operate a newspaper. Anyone can set up a newspaper without the permission of the government. Indeed, the only way the federal government can regulate newspapers is probably through the corporations power in the Constitution. So there’s no scope for imposing, for example, a “fit and proper person” test on owning a newspaper, at least not by the federal government.

That’s not to say newspapers aren’t regulated. They’re included in the media diversity laws (courtesy of the corporation’s power) via the licensing area mechanism — whatever major papers are sold in a licence area get counted for the purposes of our media diversity laws, which are numerically based — you can’t own three out of three of TV, radio and newspapers, the number of owners of TV, radio and newspapers can’t fall below five in cities and four in regional areas, you can’t reach more than 75% of the TV audience and so on.

So far, so straightforward. But newspapers are in fact licensed indirectly, because it’s not really the case that anyone can operate a newspaper. The printing presses and distribution networks to produce anything more than a newsletter are so significant that there is a basic licensing effect created by the capital requirements of the newspaper business.  To operate a newspaper, you needed a strong capital base. Apart from anything else, that means there’s an incentive for people you’ve defamed to use the defamation laws to sue you, because you have the capacity to pay up. And newspaper proprietors received political licence to operate through privileged access to governments and politicians.

Moreover, like broadcasters, they were protected. One of the other purposes of the licensing system in broadcasting is to prevent new entrants from competing with incumbents. And until 2006, newspapers were protected from competition nearly as much as broadcasters, because our foreign investment laws in effect prevented the only likely source of new investment in newspapers, foreign media companies, from operating an Australian newspaper.

The only exception was News Corporation — which, remember, is a US- and Saudi-owned company — because it was protected by grandfathering provisions.

So it’s never been strictly true that newspapers aren’t “licensed”. It’s more accurate to say that they’re not licensed or regulated in the same way as broadcasters.

And as the Prime Minister accurately noted yesterday, the current convergence review that’s under way doesn’t include newspapers – it’s limited to broadcasting, telecoms and radio communications.

But here’s where it gets trickier, though: newspapers are increasingly delivered online. The dead tree model is dying. For many people with broadband, newspapers and television are already delivered via the same medium — which happens to be neither the native medium of newspapers nor of broadcasting, but online. That’s reinforced by the fact that the Murdochs and the Stokes operate across free-to-air TV, subscription TV and newspapers, but work in different regulatory environments for each.

That is, in a converging media environment, a licence area-based approach to media regulation makes less and less sense. If they’re both delivered online and owned by the same people, why should newspapers and television be regulated differently?

That’s the “regulatory parity” argument, advanced mainly by the most heavily regulated broadcasters, free-to-air television, in the hope that it will have some regulatory shackles (such as local content obligations) removed, or as a fallback option, that competing media — the internet, basically — will be regulated like them. Net libertarians shouldn’t be too sanguine about that — it’s already happened with anti-siphoning.

The problem with “regulatory parity” though is that if you want to use that argument to get at Murdoch, then you get everything else online as well. If you want to regulate newspapers, then you regulate Crikey, which people may be fine with. And you regulate your favourite blogger, who’s probably getting stuck into News Ltd even as we speak. And, eventually, logically, you regulate social media as well. Or at least you’re trying to.

In short, there’s a lot of sloppy thinking around at the moment about media regulation.

One of the issues that is in the convergence review is media diversity. Crikey has mostly been a lone voice on this — mainstream media proprietors prefer to stay quiet on diversity issues until they want “reform” i.e. some loosening of the rules that they can exploit. When they do, then we start hearing about the benefits of deregulation, the competition afforded by the internet, consumer choice … sorry — I started flashing back to 2006 and having panic attacks.

The idea of a public interest test is going to rear its particularly ugly ahead again in the media regulation debate. This thing is the truly indestructible zombie of the media diversity debate and it walks again courtesy of the convergence review. In the review’s “Emerging Issues” paper, it raised the test as a potential mechanism for regulating media diversity in place of the current quantitative limit.

Everyone — even the Productivity Commission — likes the idea of a public interest test, which would require media mergers to be considered against the public interest.

The problem is, it doesn’t solve anything. A public interest test for media transactions replaces an objective, clear and simple framework with a politician making subjective decisions — based on advice from experts, but subjective nonetheless — about media mergers?

Who really thinks putting politicians in charge of, say, whether Lachlan Murdoch should have been allowed to buy into the Ten Network would be a good idea? You may not like the current quantitative approach to media diversity, but you’re not relying on an individual’s judgment — made in the context of enormous political pressure and possible future employment — to vet mergers.

A “fit and proper person” test has exactly the same problem. It’s a subjective test, that someone has to make — a politician or a regulator and, inevitably, a judge. And my fit and proper person is your devil incarnate and her speaker of truth to power.

I’ve previously argued that a new approach to media diversity should include a “national media groups” test — that is, expanding the remit and extending the application of the quantitative media diversity from licence areas to a national level. Mergers within major national media — key newspapers, commercial television, subscription television, the biggest radio networks — would be subject to restrictions regardless of how they played in local markets (where, for example, racing radio stations count for the same contribution to diversity as a major newspaper). Our national media diversity is already frighteningly low — there are just six major national media groups, four of them family empires that often work together.

Between that and a statutory right to privacy, you’d have a stronger media regulatory framework while avoiding most of the pitfalls of greater media regulation that is now being urged.

*Bernard Keane worked in broadcasting policy in the Department of Communications from 2000-08