The Australian Competition and Consumer Commission is shaping up for what could be a test of whether competition law can be used to protect diversity of news and information.

This morning ACCC head Graeme Samuel told Crikey his inquiries into the Macquarie Media-Fairfax carve-up of Southern Cross Broadcasting would include a region-by-region “qualitative” assessment of the impact on the market for news and information, and local news in particular.

Given that the Macquarie-Fairfax deal is the first merger made possible by the new media ownership laws, Samuel’s role could be crucial.

The investigation could develop into a test of what Samuel has always claimed: that the combination of competition law and ACMA’s powers will be sufficient to protect media diversity.

The significance of last Friday’s announcement by the ACCC seems to have been missed by the business media and proponents of media diversity.

Samuel’s inquiry will invite submissions and he clearly expects to hear from the National Party MPs and others who are concerned about a further reduction in sources of local content, given that Macquarie Media are syndicators and “hubbers” of news par excellence.

Ever since 2005 Samuel has consistently indicated, that he is ready to grapple with “the market place of ideas” as though that phrase is more than a metaphor.

Plenty of experts on competition law are sceptical about whether it can really be used in this way. Is it possible to define a “market” for news and information, given that most media organisations don’t charge for their content, and key “market advantage” issues such as quality and credibility are almost impossible to define?

In a discussion paper released in August last year, he said that the ACCC would consider whether a merged media business might “exercise market power by reducing the quality of the content it provides consumers, which could include reducing the diversity of the content it provides.”

And here the ACCC signalled that in considering media mergers, it would consider three main markets:

The supply of advertising opportunities to advertisers; the supply of content to consumers; and the acquisition of content from content providers. Other more specific products – such as premium content; classified and display advertising; and the delivery of news, information and opinion – may also be critical when considering particular mergers.

All this is of potential significance to the Macquarie-Fairfax move.

Samuel emphasized this morning that his process would not duplicate that already gone through by ACMA, which has approved the deal subject to Macquarie agreeing to sell some assets.

But the ACCC analysis, he said, would be “qualitative” whereas the ACMA process was necessarily “quantitative” and focused on the “number of voices” test written into media ownership legislation.

So is Macquarie worried? A spokeswoman said this morning that the group had always understood Samuel’s inquiry was “on the cards”, but declined to comment on what specific markets the group expected Samuel to investigate.