May should have been a milestone month for Australian international broadcasting, and arguably the most celebratory in the 13-year history of the Australia Network. ABC executives were due to sign a prized deal with the Shanghai Media Group, giving the ABC the most extensive access to Chinese audiences of any Western broadcaster, with a more expansive reach even than the BBC or CNN. 'Most importantly, the agreement will provide opportunities for promotion of Australian business, tourism, entertainment, culture and education', said Lynley Marshall, the chief executive of ABC International.

Instead, the DFAT-funded network is to be shut down. On the eve of its greatest triumph, the Australia Network has been told it can no longer compete.

In an ever more cutthroat field of international broadcasters that includes the BBC, CCTV, RT, Deutsche Welle, France 24, Iran's Press TV and al-Jazeera, the Australia Network had been making major strides. The Shanghai Media Group deal meant Australia was about to join the UK and US as the only countries with broadcasting rights in China.

Yet it will cease to broadcast in the 46 nations where presently it is available. Aussie expats will find it harder to watch their beloved footy teams. More importantly for Australia, regional viewers from French Polynesia to Pakistan will no longer be able to peer through what the former foreign affairs minister Alexander Downer called a 'window on Australia' to see 'Australian perspectives of the world'.

ABC Managing Director Mark Scott has been arguing for years that the Australia Network represents the country's most cost-effective form of soft diplomacy, and that the $223 million ten-year contract negotiated with the Labor government after a messy and politically-charged tendering process was money well spent. The network was particularly useful during the Indian students crisis, he claimed, to counter the sensationalist reporting of Indian cable news channels. Mr Scott could also cite an impressive statistic from a 2009 survey which found that 55% of adults in urban areas in the Pacific watched the Australia Network during the previous week. 'What other means of public diplomacy has that reach?' he asked.

The Australia Network, in conjunction with Radio Australia, was also part of a broader public diplomacy mission. 'These Australian services are a sign to our regional neighbours in Asia and the Pacific of our determination to engage with them', he argued in 2010.' But they are also a sign of something larger, of how Australia lives up to the promise of freedom of expression, of an open, democratic way of life'. That was underscored by the editorial independence of the ABC.

Even though Radio Australia was founded in 1939, while Robert Menzies was prime minister, and ABC Asia Pacific, the forerunner of the Australia Network, was created during the Howard years, the Abbott Government has decided to pull the plug.

Julie Bishop had already indicated she thought it was failing as a tool of public diplomacy. 'I am concerned by the level of negative feedback I receive from overseas', she said. Tony Abbott has complained that the ABC is unpatriotic, especially after it aired, in partnership with The Guardian, revelations from Edward Snowden about Australian spying in Indonesia. 'I think it dismays Australians when the national broadcaster appears to take everyone's side but its own', he told the talk show host Ray Hadley. There is also the suspicion that in axing the Australia Network the Prime Minister is delivering the 'quo' to Rupert Murdoch's pre-election tabloid 'quid'. Sky News had been trying for years to get the lucrative DFAT contract.

Communications Minister Malcolm Turnbull, who only this month appeared on the influential Hardtalk program on BBC World News, believes that in this digital age the ABC can simply stream its 24-hour news channel.

Following the change of government, ABC executives suspected this was coming, though they hoped the China deal would save the network from the axe. But the writing was daubed indelibly on the wall in a lecture delivered last October by Peter Varghese, the secretary of DFAT. Speaking on the subject of 'Building Australia's Soft Power', he did not even mention the Australia Network or Radio Australia. What made this omission all the more pointed was that he was delivering the Bruce Allen Memorial Lecture, which honours the life of an ABC journalist with a passion for international broadcasting. Three years earlier, Mark Scott had himself given the memorial lecture and entitled it 'A Global ABC: Soft Diplomacy and the world of international broadcasting'.

Varghese did not deliver a rebuttal. Rather, he disregarded Mark Scott's arguments completely.

Soft power is notoriously hard to quantify. However, international broadcasting is widely viewed as particularly cost-effective, which explains why France, Germany, China, and Japan have expanded their Pacific services in recent years. The BBC, my own employer, may have lost 15 language services since 2006 and seen the withdrawal of Foreign Office funding for the World Service, but it is still planning to extend its global reach — to a worldwide audience of 500 million by 2022, its centenary year. In Britain's case, the withdrawal of government funding did not mean the end of the BBC's global operations. Far from it.

Speakers at a recent conference held at Washington's Heritage Foundation, a right-wing think-tank, called for America to boost its international broadcasts, especially in Ukraine, to counter the influence of Russian broadcasters. When Monocle magazine compiled its latest soft power index, it praised France for investing in France 24 and Radio France International.

Australia has generally performed well in the Monocle annual soft power index. Currently it is ranked 7th (although its asylum seeker policies and opposition to same-sex marriage evidently prevented it rising further up the ladder). When next year's index is compiled, the demise of the Australia Network will surely cost it dear.

For Australian journalism, this is obviously a major setback. ABC's Asia Pacific News Centre is the only newsroom in Australia dedicated to delivering news to and from the region. The Australia Network has three dedicated staff in Beijing (a correspondent, cameraman and producer), two in Jakarta, and one in India. Insiders at the ABC say it will have a spill-over effect on the domestic coverage of Asia, because so many bureaux relied on Australia Network funding.

The diplomatic cost is harder to calculate. At a time when Australia would have been expected to project its influence in the Asia Pacific, it has given the appearance of shying away. It has given up a vital tool in explaining itself to its neighbours. And when some are calling for a larger Australia, it runs the risk of appearing provincial and small.

 Image by Flickr user Eddy Milfort