It will also examine how newswire services such as the loss-making Australian Associated Press support local journalism as well as the challenges that small community and regional news outlets face. The motion,instigated because of the number of people who signed Mr Rudd's petition,was not opposed and passed without a vote.
Ms Hanson-Young said it was essential to look at the state of media diversity in Australia before another federal election.
"It’s clear from the half a million signatures on the record-breaking petition for a Royal Commission into media diversity that Australians are very concerned about the concentration of media ownership and the power and political influence of Murdoch,"Ms Hanson-Young said."As a Parliament it was right that we acted on those concerns.
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"The loss of media outlets and the increasing pressure faced by small and independent publishers is bad for our democracy and should be given the attention it deserves. The dominance of Facebook and Google has been ever increasing and this inquiry will also provide an opportunity for a proper consideration of how that is impacting media diversity."
The Senate inquiry will not carry the same weight as the royal commission requested by Mr Rudd but will give senators the chance to investigate some of his claims. An inquiry can order witnesses to attend and require the production of documents,but the final report is not necessarily independent and can be influenced by the political make up of the committee.
Royal commissions involve the appointment of independent commissioners and lawyers to test the evidence and witnesses,before making recommendations to governments.